Super Death Benefits

Tax on death benefits

The information listed below is a summary and is intended to be of a general nature only. It does not take into account your individual circumstances or the specifics of your existing superannuation fund.

The below information is not intended to be comprehensive and we recommend that you seek professional advice that will take into account and address your personal circumstances.

Many factors can influence the way a superannuation fund is taxed. This section is of a general nature only and is based on current tax law, which may change.

The tax treatment of death benefits within superannuation depends on whether a dependant or non-dependant receives the superannuation death benefit.

Paid to dependant

A lump sum superannuation death benefit paid to a dependant will be tax free. A dependant includes a spouse, former spouse, child under the age of 18, a disabled child or someone who had an interdependency relationship with, or was a financial dependant.

Paid to a non-dependant

A lump sum death benefit paid to someone who is not a dependant will generally consist of a taxable and tax-free component. There is no tax on the tax-free component, and the taxable component will generally be taxed at a maximum rate of 16.5% (including Medicare levy).