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SMSF Property

Prior to September 2007 it’s estimated that only 1% of Australians had the capability to purchase property within their Superannuation, this is because borrowing wasn’t permitted within Super therefore the fund was required to purchase the property outright.

However with the introduction of Limited Recourse Borrowing Arrangements came the ability for super funds to borrow money and subsequently the opportunity for a greater number of Australians to purchase property with their super.

In order to purchase property, one must first establish a Self-Managed Super Fund (SMSF) plus you can only buy property through your SMSF if you comply with the rules.

The property:

  • Must meet the 'sole purpose test' of solely providing retirement benefits to fund members
  • Must not be acquired from a related party of a member
  • Must not be lived in by a fund member or any fund members' related parties
  • Must not be rented by a fund member or any fund members' related parties

However, your SMSF could potentially purchase your business premises, allowing you to pay rent directly to your SMSF at the market rate.