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If your super fund has sufficient money, it can purchase property in a very similar way to a personal transaction, or through any regular business structure… it’s like a ‘cash’ transaction.
If the fund doesn’t have the entire amount of the purchase available, it can borrow money (much like you might personally from a bank or credit society); however, we note there are special rules surrounding borrowing through your SMSF.
If you already own property (as long as it’s considered a ‘business real property’ meaning it is used wholly and exclusively in a business) you can either sell it to your fund or transfer it into your SMSF by way of an in-specie contribution (a superannuation contribution that is made using an asset rather than using money).
Once a property is owned by an SMSF, there are rules that relate to the use of the property. In short, the property cannot be used by you personally, unless it meets the business real property requirements.
In the event you decide to operate your business through a premise owned by your SMSF, it’s important a commercial rate of rent is paid to your fund.
So in short – there’s lots to think about. There are accountants who specialise in Self-Managed Super Funds, and if you are considering this option, they would be well worth talking to.
There is much more information about Self-Managed Super Funds at the Self Managed Super Fund Institute: http://www.smsfinstitute.com.au/smsf-buying-property.php
Your Professionals Property Consultant will have further information about buying property through your Super Fund. Please feel free to ask us at any time.