SMSF Loans
SMSF Loans?
How they Work
What Types Of Property Can You Purchase
- Off the plan
- House and land
- Existing
- Units and Houses
- Business premise
- Investments
Types Of Funding
How Do Lenders Assess My Borrowing Capacity?
- Income – SMSF Contributions / Rental Property Income / Other income
- – This is the most important part, so you know and the lender knows you can service an SMSF loan
- Purhcase costs – Deposit funds – 20% / Stamp Duty / Legal, Conveyance and Advice / Broker costs Location and type of property
- – What you buy and where you buy can affect how much you can borrow
SMSF Property Do’s and Don’ts
- You cannot purchase a property to live in, or for your relatives or associates benefit from – All property must be on commercial terms and market values – At arm’s length – lease agreements and loans in place
- This would be treated as an in-house asset
- It would be assessed as non arms length income – taxed at 45% + penalties
- Smsf’s are able to use cash or contributions to manage these requirements
SMSF Lending FAQs
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
As the Trustee of your fund (SMSF), you control your own money and you decide how and where to invest. All your investments and bank accounts are in the name of your super fund. Yes, your SMSF fund requires a bank account through which you can pay administration fees, tax expenses, and any setup fees or receive any ongoing payments (super contributions, rent) associated with the assets you hold in your SMSF.
We don’t handle your funds or have access to your SMSF cash account. We receive a copy of the bank statement in CSV format to help us complete your administration work.
SMSF Risks
-
What does it cost?
Typically SMSF Administration costs ( Accounting + Auditing) can vary from, $5,500 – $990 per annum, so it is important that you do your research and find the right provider for your needs -
What are the benefits of Retail / industry Funds :
Retail and Industry funds provide some great benefits a) They manage the investment options for you b) They provide group insurance cover at a discount rate c) The take care of all the administration of the fund -
Time and experience?
You will need to allocate around 1-2 hours a month to oversee your SMSF administration tasks and investments. It helps if you have investment experience, so you make good decisions to grow your wealth in super. Subscribe to magazines, courses and hire an adviser to assist you fund. These are potentially some solutions to employ - Failed investments: If an investment fails, such as a unit trust or private investment, there are no compensation mechanisms for SMSF’s unlike for retail and industry funds
SMSF Risks
-
What does it cost?
Typically SMSF Administration costs ( Accounting + Auditing) can vary from, $5,500 – $990 per annum, so it is important that you do your research and find the right provider for your needs -
What are the benefits of Retail / industry Funds :
Retail and Industry funds provide some great benefits a) They manage the investment options for you b) They provide group insurance cover at a discount rate c) The take care of all the administration of the fund -
Time and experience?
You will need to allocate around 1-2 hours a month to oversee your SMSF administration tasks and investments. It helps if you have investment experience, so you make good decisions to grow your wealth in super. Subscribe to magazines, courses and hire an adviser to assist you fund. These are potentially some solutions to employ - Failed investments: If an investment fails, such as a unit trust or private investment, there are no compensation mechanisms for SMSF’s unlike for retail and industry funds
SMSF Risks
- The fund must always be run with the sole purpose of providing retirement benefits.
- SMSF monies can only be used to generate income and capital growth for retirement purposes Withdrawals are only allowed in pension ( 60-65+) phase or when paying for services.
- SMSFs can only borrow indirectly via a related bare trust.
- SMSF’s can use individual trustees or use a company as a trustee. Lenders prefer corporate ( company) trustees and often lend a little more to corporate trustee SMSF’s
- An SMSF can have between one to six* members.
- The SMSF’s deed must allow borrowing and property investment
- The SMSF must be a complying fund with the ATO
SMSF Risks
- The fund must always be run with the sole purpose of providing retirement benefits.
- SMSF monies can only be used to generate income and capital growth for retirement purposes Withdrawals are only allowed in pension ( 60-65+) phase or when paying for services.
- SMSFs can only borrow indirectly via a related bare trust.
- SMSF’s can use individual trustees or use a company as a trustee. Lenders prefer corporate ( company) trustees and often lend a little more to corporate trustee SMSF’s
- An SMSF can have between one to six* members.
- The SMSF’s deed must allow borrowing and property investment
- The SMSF must be a complying fund with the ATO
SMSF Double Stamp Duty Risk
SMSF Property deals run the risk of triggering double duty. As the Bare Trustee owns the property, whilst the loan is in place, the super fund is only a beneficial owner. Once the loan is paid off, the property must transfer to the SMSF and the title of the propertymust be changed to the SMSF trustee.
If these arrangements are not attended to correctly, double duty may be imposed on the fundand its members when these steps are undertaken.
Stamp duty will be payable on the initial transfer from the property vendor and when the property transfers from the Bare Trustee company to the SMSF trustee company. Some lenders use their own custodian structure, so the transfer of title upon completion of the loan may also attract additional stamp duty charges! Unbeknown to the SMSF members. This highlights the importance of getting the right advice with these arrangements,
before selecting a lender.