If you want to take out insurance through your super rather than stand alone insurance, there are some significant advantages and disadvantages.
This table summarises the tax treatment of payouts (benefits) and premiums
from pre-tax income (inside super) and post-tax income (outside super).
*Superannuation dependants for tax purposes include:
- the deceased’s spouse (including same or opposite sex and de-facto).
- the deceased’s child under age 18.
- any other person who was financially dependent on the deceased just before they died.
- any other person with whom the deceased person had an interdependency relationship just before he or she died.
Calculating the tax on Total and Permanent Asus Transformer Book T100TA-DK003H AC Adapter Disability super benefits, and death super benefits for non-dependants, is a complex formula involving the number of days
in work, days to retirement and whether the insurance was paid from pre or post-tax income. If you are looking at nominating non-dependants as beneficiaries you should obtain professional advice to understand the taxation implications involved.