A Checklist for Preparing a Binding Death Benefit Nomination for your SMSF
Updated: 8 minutes ago
This checklist is only a guide and is not legal advice. Speak with a lawyer to make sure your binding death benefit nomination is valid and reflects your wishes. This article is current as at October 2026.
Table of Contents
Use Clear Directions
Confirm Your Capacity
Check Any Pension
Coordinate with Your Will
Plan for Control of the Fund
Consider the Tax Position
These are some consequences of not having a valid binding death benefit nomination (BDBN) for your SMSF:
the trustee, often a surviving fellow member, will decide who receives your superannuation
your intended beneficiaries may not receive your superannuation benefits
an invalid BDBN can lead to family disputes and court challenges, causing delay, cost and stress
an invalid BDBN may mean your beneficiaries pay more tax if the benefit is not paid as you planned
an invalid BDBN can upset the rest of your estate plan, including how your will divides your assets.
1. Review the Trust Deed
Read your SMSF trust deed and its rules on death benefit nominations. Check that the trust deed allows binding death benefit nominations.
2. Eligibility
Confirm that you can make a binding death benefit nomination. Some trust deeds limit who can make one, so check the deed for any conditions.
3. Understand the Types of Nominations
Decide which type of nomination you want. There are generally two types:
a. Lapsing Nomination expires at the end of the period set by your trust deed, unless renewed or replaced.
b. Non-Lapsing Nomination remains valid until you revoke or replace it, if your trust deed allows it.
Check which type of nomination the trust deed allows you to make. The 3-year lapsing rule in the super regulations does not apply to SMSFs unless your trust deed adopts it. The High Court confirmed this in Hill v Zuda Pty Ltd [2022] HCA 21.
4. Beneficiary Designation
Decide who you want to receive your superannuation death benefits. Give each beneficiary's full name and the percentage they are to receive, with the total adding up to 100%. Avoid fixed dollar amounts, as your balance will change over time.
If you want the benefit to pass under your will, nominate your legal personal representative. Use the exact term your trust deed uses, which is usually "legal personal representative". In Munro v Munro [2015] QSC 61, a nomination to the "Trustee of Deceased Estate" failed for this reason.
5. Check Beneficiary Eligibility
Check that each person you nominate can receive a death benefit under your trust deed and superannuation law.
6. Consider Dependants and Legal Personal Representatives
Understand the difference between dependants and legal personal representatives (LPRs).
Dependants generally include your spouse (including a de facto partner) and your children of any age. They also include anyone financially dependent on you or in an interdependency relationship with you. Parents, siblings and other relatives can only be nominated directly if they meet one of these tests.
For a death benefit, your LPR is the executor or administrator of your estate. A benefit paid to your LPR is dealt with under your will or under the intestacy rules if you have no will.
7. Follow SMSF Trust Deed Requirements
Follow every requirement in your trust deed about signing, validity and acceptance of the nomination. The deed may set extra conditions that must be met for the nomination to be valid.
8. Use the Correct Form
Use the form provided by your SMSF trustee or prepare one that meets the requirements of your trust deed. If your trust deed sets out a form, use that form.
The form should state that it is a binding death benefit nomination. It should include your details and your beneficiaries' details. Include witness signatures if your trust deed calls for them.
9. Witness Requirements
The witnessing rules in the super regulations do not apply to SMSFs unless your trust deed adopts them. Follow your trust deed exactly. As a safeguard, use two adult witnesses who are not named as beneficiaries in the nomination.
10. Sign and Date Properly
Sign and date the nomination in front of your witnesses. Each witness should sign and date it and add their full name and address. Follow any witnessing steps your trust deed sets out.
11. Lodge the Nomination
Give the signed nomination to the trustee in the way your trust deed says. If the trustee is a company, give it to the company, for example to a director or at its registered office.
12. Acknowledgment from Trustee
If your trust deed says the trustee must accept the nomination, follow the steps the deed sets out. Even if acceptance is not needed, get a signed acknowledgment of receipt from the trustee.
If the trustee is a company, the acknowledgment should be given by the company. Keep it with your records as proof that your nomination was received.
13. Communicate with Beneficiaries
This is not a legal requirement, but it is usually wise to tell your beneficiaries about your nomination. It helps them understand what they may receive and can reduce confusion or disputes.
14. Keep Records
Keep copies of your signed nomination, the trust deed and any related letters or emails. Tell your executor or another trusted person where these records are kept.
15. Review and Update Regularly
Review your binding death benefit nomination regularly so it reflects your current circumstances and wishes. Update it after life events such as marriage, divorce, the birth of a child or the death of a beneficiary. Also review it if you start a pension, amend your trust deed or a beneficiary stops being a dependant.
Take care before withdrawing super late in life. Money withdrawn before death stops being super, so your nomination will not apply to it. Neal v Brown [2024] NSWSC 841 and Lin v Yim [2026] QSC 57 show how this can change who receives the money.
16. Use Clear Directions
Your nomination should say that it is binding. It should also direct the trustee, for example "I direct the trustee to pay". In Donovan v Donovan [2009] QSC 26, a nomination that did neither was not binding.
17. Confirm Your Capacity
You must have the mental capacity to make a binding death benefit nomination. In Western Australia, an administrator appointed for you cannot make one on your behalf. The State Administrative Tribunal decided this in SM [2019] WASAT 22.
If you are concerned about losing capacity in future, put your nomination in place now.
18. Check Any Pension
If you receive a pension from your SMSF, check whether it is reversionary. A reversionary pension may pass automatically to the nominated person and take priority over your nomination. Make sure your pension documents and your nomination work together.
19. Coordinate with Your Will
Your will cannot bind the trustee of your SMSF. In Ioppolo v Conti [2015] WASCA 45, a direction about super in a will did not bind the surviving trustee. Your nomination and your will should work together.
If your executor is also a beneficiary, your will should allow them to claim your super personally.
20. Plan for Control of the Fund
A binding death benefit nomination decides who receives your benefit, not who controls the fund. Consider who will be the trustee or director after your death. Your executor does not automatically become a trustee.
If those in control do not follow your nomination, your beneficiaries may need to go to court to enforce it.
21. Consider the Tax Position
Adult children who are financially independent are not dependants for tax purposes. They may pay tax on the taxable component of your death benefit. Speak with your accountant or financial adviser about the tax position.
22. Seek Legal Advice
If you are unsure whether your nomination is valid, speak with an estate planning and superannuation lawyer. They can advise on your circumstances and help you meet the legal requirements.
This checklist is a guide only. A lawyer experienced in estate planning and SMSFs can make sure your nomination suits you and is valid.
Call me on 0421 145 637 or email val@crystallawyers.com.au for help.
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