Find Investment Property | July 2009 There are strict rules that apply to Self-managed Superannuation Funds (SMSFs) If you make sure you follow these compliance regulations to the letter there are a number of advantages to a DIY super fund. The major benefits of a property investment self- managed superannuation fund are that your contributions to the SMSF are taxed at only 15. Also if you want to sell your property, and you have owned it for more than 12 months, your capital gains tax is only 10%. Once you reach 60 years of age no capital gains tax applies. Interest payments on a DIY fund loan are also tax deductible. Basic DIY Fund Compliance Requirements • A Self-Managed Superannuation fund must be registered with, report to, and is regulated by the Australian Taxation Office • The SMSF fund should have no more than 5 members. • Each individual trustee of the fund must be a fund member and each member of the fund must be a trustee • A member of the fund must not be an employee of another member of the fund, unless those members are related; • The trustee can be a corporate entity; • No trustee of the fund receives remuneration for his or her services as a trustee. • Your DIY Super fund loan maybe ruled as non- compliant unless it strictly complies with the ATO & SIS Act rulings • The SMSF loan is limited recourse to the property purchased which means the lender cannot touch the other assets of your self managed super fund. You need to make sure you get the right self managed superannuation fund advice in order to understand your compliance responsibilities under the SIS Act. Consult your accountant or financial advisor for more information about buying an investment property in your self managed super fund (SMSF).
