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A member of an SMSF had 4 Account Based Pensions in the Fund. The member had a Binding Death Agreement in place when he set up the first pension account. There were no binding death agreements for the subsequent pensions. The surviving spouse has taken on all 4 pensions - not sure as to whether this is possible considering the binding death agreement for a reversionary pension was put in place only when the first pension was established by the deceased member.
Any comments would be welcome.
Hi Ronald
I will just give general response as I do not have details such as their ages and the spouses transfer balance account. I also do not have a copy of the Binding Death Agreement. I assume the first pension is a reversionary pension and the other 3 have been set up as non reversionary pensions. I also do not have a copy of the Fund's trust deed.
As a starting point a death benefit can be paid to a surviving spouse either by way of paying a pension and or paying a lump sum benefit. That is there is an ability to pay a benefit as a pension to a surviving spouse upon the death of a spouse.
You need to review the death benefit agreement to see if that just relates to the first pension or all of the pensions. The Fund's trust deed needs to be reviewed as well. The other issue that needs to be considered is who will act as the deceased member's trustee in their place (being the legal personal representative) from the date of their death to the date that their benefits are paid out of the Fund.
Thanks
SMSF AAA
Thanks
SMSF AAA