Fact Sheet
AUSTRALIA POST SUPER SCHEME
Australia Post Superannuation Scheme
November 2013
What happens to your pension
when you die?
Leaving clear instructions for the distribution of your pension after you’ve passed away can
make it easier for your loved ones. This fact sheet will help you to understand your options.
Let us know your wishes
In the event of your death, the Trustee of the APSS
is required by law to pay your pension account to
one or more of your dependants, your legal personal
representative or any other person permitted by law.
If you have started a pension in the APSS you can
nominate one or more reversionary beneficiaries to
receive your pension benefit in the event of your death.
If the people you want to nominate do not qualify as
reversionary beneficiaries (e.g. your adult child), you
can nominate other dependants and/or your legal
personal representative as your beneficiaries. (See the
section on Nominating Beneficiaries on page 3).
So what’s the difference?
Reversionary
Reversionary beneficiary
nominations that are
valid upon your death are
binding on the Trustee.
This means that the
Trustee must act on your
instruction.
Reversionary beneficiaries
may receive your death
benefit as either a pension
or a lump sum.
Beneficiary
Nominating a beneficiary
only provides the Trustee
with a guide as to whom
you would like your death
benefit paid to in the event
of your death. The Trustee
is not bound by your
nomination.
Beneficiaries must receive
your death benefit as a
lump sum. They do not
have the option to take the
benefit as pension.
There may be taxation, Centrelink and other
implications to consider when making or varying
your nominations. We strongly recommend that
you seek professional advice.
Definitions
Legal personal representative
This is the executor or administrator of your estate.
Dependant
This is your spouse or child, or any other person
who in the opinion of the Trustee, was in any way
financially dependent on you at the time of your
death or with whom you had an interdependency
relationship at the time of your death.
Spouse
The definition of spouse for an APSS member includes
a person who is:
• legally married to you, or
• your de facto partner of the same or opposite sex.
Children
Your children include your adopted child, a foster child
and a child recognised as your child or your spouse’s
child under family law legislation.
Financially dependent
A financial dependant is any person who in the
opinion of the Trustee, is or was in any way financially
dependent on you at the date of your death.
Interdependent relationship
An interdependent relationship means:
• you live with someone in a close personal
relationship, and
• one of you provides the other with financial
assistance, domestic support and personal care.
If you have a close personal relationship but don’t
meet the other requirements because either or both
of you suffer from a disability, or you are temporarily
living apart (e.g. temporarily working overseas or
in gaol), your relationship can still be classified as
interdependent.
Australia Post Superannuation Scheme – Fact Sheet: What happens to your pension when you die?
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Fact Sheet
What happens to your pension when you die? (continued)
Reversionary beneficiaries
If you would like the balance of your pension to
continue to be paid to one or more of your eligible
dependants after your death, you can nominate them
as your reversionary beneficiary. If they prefer, they can
also choose to receive a lump sum of the balance of
your pension account instead of taking regular pension
payments.
Provided your nominated reversionary beneficiary
is an eligible dependant at the date of your death
(see below), the Trustee must generally act on your
nomination.
If at the time of your death you and your surviving
spouse were both under age 60, then the taxable
component of the pension payments which your
surviving spouse receives will be assessable income but
receives a 15% tax offset until your spouse turns age 60.
If at the time of your death, either you or your surviving
spouse was over age 60, then the pension payments to
your surviving spouse will be tax free.
Who can be my
reversionary?
Your nominated reversionary beneficiary must be
an eligible dependant at the date of your death.
This means by law you can only nominate one of
the following people:
• your spouse
• your children under 18 (exceptions apply
if they are between 18 and 25 and still
financially dependent on you, or over 18 and
permanently disabled)*
• any person who was financially dependent
on you
• any person with whom you had an
interdependency relationship.
* i.e. This means they have a disability that meets the
requirements of section 8(1) of the Disability Services
Act 1986 (Commonwealth).
Where a pension is payable to a financially dependent
child between 18 and 25, the child will continue to
receive pension payments from the pension account
until they reach 25 unless the account balance is
reduced to zero earlier. Once the child turns 25, the
pension account balance will immediately need to be
converted into a lump sum and paid to them, unless
the child has a disability within the meaning of section
8(1) of the Disability Services Act 1986 (Cth). If so, the
pension can continue to be paid to the disabled child
until the pension account balance is exhausted.
Refer to “How will a lump sum death benefit be taxed?”
on page 3 of this fact sheet for a general description of
the tax consequences if your spouse elects to receive
the balance of your pension account as a lump sum,
or the pension account balance otherwise needs to be
paid as a lump sum.
How do I nominate or change my
reversionary beneficiary?
To update your reversionary beneficiary details simply
contact SuperPhone on 1300 360 373.
What happens if I don’t make
a choice or my reversionary
nomination is not valid?
The Trustee will take into account your personal
circumstances at the time of your death when
determining how to distribute the remaining balance
of your pension account to one or more of your
dependants, your legal representative or (if none of
these apply) to any other person permitted by law. This
will happen, if at the time of your death:
• you have not nominated any reversionary
beneficiaries
• the reversionary beneficiaries nominated have all
died before you, and you have not updated your
nominations, or
• an invalid nomination has been submitted by you.
Need more information?
Call SuperPhone on 1300 360 373. Visit the website at apss.com.au. Speak to a licensed financial adviser.
Australia Post Superannuation Scheme – Fact Sheet: What happens to your pension when you die?
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Fact Sheet
What happens to your pension when you die? (continued)
Nominating beneficiaries
If the person you want to nominate is someone who
does not qualify as a reversionary beneficiary (e.g. your
adult child), then you can nominate one or more other
dependants and/or your legal personal representative
as your beneficiaries. It is important to note that for
your nominated beneficiaries, the Trustee will be
guided by your wishes but is not legally bound by your
nomination.
Any benefit paid to nominated beneficiaries who do not
qualify as reversionary beneficiaries must be paid as a
lump sum. There is no option to pay a pension/income
stream to other nominated beneficiaries.
Who can I nominate to be my
beneficiary?
Under superannuation law you can nominate one
or more of your dependants, or legal personal
representative to be your beneficiary(ies). Refer to the
definitions on page 1 of this fact sheet.
How do I nominate or change my
beneficiaries?
You can nominate or change your beneficiary details
at any time. Just log on to the secure section of the
APSS website and make the changes online, or if you
prefer, call SuperPhone and change it over the phone.
You can also download the form from the website, or
call SuperPhone to have one sent out to your address.
Keeping your beneficiary details up to date will help
ensure that your nomination accurately reflects
your wishes and current situation. This is especially
important if your family or personal circumstances
change, such as if you have had a child, married or
divorced. You can find out who you have currently
nominated as your beneficiaries by logging into the
secure section of the APSS website with your PIN and
Member Number or by calling SuperPhone.
How will a lump sum death benefit
be taxed?
Provided your beneficiaries receive a lump sum from
the APSS and they are a ‘death benefit dependant’ for
tax purposes at the time of your death, the payment
will be tax free. Death benefit dependants for tax
purposes are your spouse (including de facto, former
and same sex), your children under age 18, any person
who was financially dependent on you, and any person
who was in an interdependency relationship with you.
Any other beneficiaries, such as your adult children
who are not financial dependants, will incur tax
(generally 15 % plus the Medicare levy) on the taxable
component of a death benefit payment.
Taxation of death benefits can be a complex issue.
We recommend that you obtain advice from a
licensed financial adviser or tax agent.
What happens to my Pension
investments after I pass away?
Once the APSS receives a notification of your death,
any Market Return Member Savings you have will
be automatically switched to Cash Return Member
Savings at the end of the fortnight following this
notification.
This means that from that point on, the dollar value
of your APSS Pension balance will be preserved.
Important
This brochure contains general information about Australia Post Superannuation Scheme (APSS). It is not intended
to be financial product advice and does not take your personal circumstances into account. Before acting on any
information contained in this document you should first consider its appropriateness to your own circumstances.
You may wish to seek the advice of a licensed financial adviser. Neither Post Super Limited nor Australia Post
or any Associated Employers holds an Australian Financial Services Licence and, therefore neither is licensed to
provide you with financial product advice.
Australia Post Superannuation Scheme (ABN 42 045 077 895) Issuer: PostSuper Pty Ltd (ABN 85 064 225 841)
RSE Licence Number L0002714 APSS Registration Number R1056549. Issued: November 2013.
Australia Post Superannuation Scheme – Fact Sheet: What happens to your pension when you die?
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