3 Responses to What happens at death of an SMSF member?

  1. Adrian September 8, 2018 at 4:31 PM #

    Could you please explain what happens regarding unrealised capital gains in the super fund on the death of the last surviving member. For example, is CGT payable on these and then the whole taxable part of the fund taxed at 15% plus medicare levy (assuming no dependents)?

  2. Rahul September 7, 2018 at 6:36 PM #

    Hi Bruce,
    Refer to this factsheet from the CSS website – in particular page 6 and the example relating to Bill and Mary.

    https://www.csc.gov.au/-/media/Files/CSS/Factsheets/CSF33-css-the-transfer-balance-cap.pdf

    It would seem that due to the unique ‘bereavement’ feature built into the CSS scheme, the transfer balance cap credit to the reversionary spouse is based on the pre death defined benefit payments. This is despite the pre death payment rate being temporary and after 7 fortinights, the rate to the reversionary, reducing to 85% of the pre death rate.

  3. Bruce Bennett September 6, 2018 at 11:43 AM #

    Thanks again for sharing Monica’s advice to Cuffelinks readers. A portion of my retirement income is a Commonwealth Superannuation Scheme pension to which the government nominated a value based on the pension paid for the $1.6m transfer balance cap. Upon my death 85% of the pension I currently receive will revert to my spouse.

    With regards to superannuation schemes that pay a reduced pension to a surviving spouse, I would be grateful if a reader could clarify whether or not, on the death of a CSS (or similar) pensioner, the notional amount counted towards a spouse’s transfer balance cap is reduced to reflect this.

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