SMSF trustee death benefit payment decisions – have you done enough to protect your position?

The recent Victorian decision of Re Marsella; Marsella v Wareham (No 2) [2019] VSC 65, demonstrates what not to do as a trustee when paying a death benefit from a self-managed superannuation fund, and, very importantly, what not to do as a trustee's adviser. The case is a perfect example of where specialist advice could have completely changed the outcome.

In Re Marsella, Mrs Marsella had died, with her daughter as the remaining trustee of her self managed superannuation fund. Her daughter decided to pay the death benefit to herself and this decision was challenged by Mrs Marsella's second husband.

The issues in dispute were whether:

• the daughter had correctly exercised the trustee's discretion in paying the death benefit to herself