SMSF administrator and document provider Class has provided more detail on the specific elements contained in the NowInfinity trust deed after its recent upgrade.
The approach NowInfinity currently uses includes principles such as prioritising reversionary pensions, honouring binding death benefit nominations (BDBN) after this and then paying out any remaining amounts at the discretion of the trustees last.
The deed also allows for flexibility if desired by the fund trustees to modify the aforementioned structure.
“It is important to note that the NowInfinity deed does permit the member to alter the default priority provisions if they wish to do so,” NowInfinity general manager Tracey Williams told delegates at Class Ignite 2023 held in Sydney today.
“This would entail a member signing a member-directed superannuation plan specifying the different priorities [desired], noting that professional advice should be sought by the member.”
During the same session, DGF Morgan director and solicitor David Morgan acknowledged why priority has been given to reversionary pensions in the treatment of death benefits by the deed.
“There will always be different views about which is the best way to go and that ultimately depends upon the circumstances of the client. [However], there have been a number of cases concerning binding death benefit nominations where they have failed,” Morgan revealed.
“There are many reasons for this and they range from [the BDBN] not complying with the deed, not having the death benefit nomination in the required format, not giving a copy of [the BDBN] to the trustee, undue influence on the signing of the death benefit nomination, no legal capacity to have the nomination signed and competing provisions between the deed and the nomination.
“Pensions, and reversionary pensions in particular, [on the other hand], must be established to be valued. The question of who should be the reversionary at the time should be fairly straightforward when the pension is set up and in most cases that should easily be incorporated in the pension agreement.
“It shouldn’t be complex.”
Class announced the upgrade to the NowInfinity trust deed yesterday.
