A Binding Death Benefit Nomination (BDBN) is a written direction you give to your SMSF trustee that tells them exactly who should receive your superannuation benefits when you pass away. It takes the decision out of the trustee’s hands and ensures your wishes are legally followed—provided the nomination is valid under the trust deed and superannuation law.
In many retail and industry super funds, BDBNs automatically expire every 3 years under superannuation law (SISR 6.17A). This means members must remember to renew them regularly or risk the nomination becoming non-binding. That expiry rule can lead to unintended outcomes if not kept up to date.
However, SMSFs offer more control. The SMSF deed facilitated by Investax is specifically drafted to remove the 3-year expiry rule, allowing members to make non-lapsing nominations. Investax SMSF deed clearly states: “A Binding Death Benefit Nomination will not lapse by reason only of the passage of time.”
This means your instructions remain valid indefinitely, giving you greater certainty and less paperwork—just another way an SMSF, when set up with the right deed, gives you more flexibility and peace of mind.
Who You Can Nominate – You can nominate:
- A dependant (e.g., your spouse, children, or someone financially dependent on you)
- Your legal personal representative (i.e., your estate)
- A Superannuation Proceeds Trust, if applicable
Can It Be Changed or Cancelled?
Yes—but you must always refer to your SMSF trust deed to confirm whether and how a binding death benefit nomination can be changed or revoked. For example, the Investax SMSF deed specifically allows members to revoke a nomination at any time or replace it by submitting a new, validly signed and witnessed nomination. The rules can vary between funds, so it’s essential to check what your deed permits.
