ARTICLE · 08 JULY 2022

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The High Court settles uncertainty around BDBNs for SMSFs

Clifford Gouldson Lawyers

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Regulation 6.17A of the SIS Act does not apply to BDBNs in SMSFs unless specifically included in the SMSF trust deed.

AustraliaFinance and Banking

Michelle Broome

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On 15 June 2022 the High Court handed down its decision in Hill v Zuda ¹ and in just over 6 pages unanimously determined that Regulation 6.17A of the SIS Act² does not apply to BDBNs (Binding Death Benefit Nominations) in Self-Managed Super Funds (SMSF) unless it is specifically included within the SMSF Trust Deed.

Regulation 6.17A deals with the rights and process for SMSF members to direct the Trustee of the SMSF in how to deal with their death benefit upon their death. If a member does not provide direction the Trustee is able to make the decision for them.

Regulation 6.17A also requires that a members' BDBN is renewed every 3 years.

So why was this decision heard by the High Court?

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