How do SMSF’s work?

Your SMSF works in much the same way as any other super fund. During your working life, contributions are made to the fund and invested to create wealth which is distributed during retirement.

Can you do this with a new SMSF?

Yes! When a new SMSF is set up by your accountant or financial planner, you can apply for a SMSF loan by showing historical contributions to your old fund(s) along with confirmation from your accountant or financial planner that your fund is being rolled over to the new SMSF.

What type of property can my SMSF purchase?

Investing in residential or commercial properties through a Self-Managed Super Fund (SMSF) is possible, subject to certain conditions:

• The property must be purchased as an investment and rented out to a third party at arm’s length.
• Is not a development – i.e. something that requires construction or is vacant land is not acceptable.
• The property meets the ‘sole purpose test’ provided by the ATO (i.e., only providing a benefit to the members upon retirement).
• The property should not be sold by a fund member or lived in by them or any related person. However, commercial properties purchased by the fund can be leased to a fund member for business purposes, following specific rules and at the market rate.
• Only one title per contract is allowed when purchasing a property through an SMSF. For instance, a duplex across two titles sold in one transaction would have to be changed to two separate transactions and loans.

If you are interested in expanding your SMSF investment portfolio, talk to us today.