Does an untaxed element arise for a super death benefit if there are no insurance proceeds?

 Author: foreverlearning(Newbie)Newbie

6 Sept 2023

I received a lump sum as a non tax dependent of a superannuation fund member.

My understanding is that the benefit had 0% in the tax-free component and 100% in the taxable (taxed) component.

However, the statement shows an amount in the taxable (untaxed) component, which the super fund says is because a tax deduction has been claimed on insurance premiums paid by the member.

Can an untaxed element arise if the insurance has been cancelled 12 months prior to the death of the member, and in a different tax year? That doesn't seem right.

https://www.ato.gov.au/Super/APRA-regulated-funds/Paying-benefits/Calculating-components-of-a-super-benefit/#Payingalumpsumwithanuntaxedelement

http://classic.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s295.465.html

http://www5.austlii.edu.au/au/legis/cth/consol_act/itaa1997240/s307.290.html

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