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Can I use a caravan situated on a block of land owned by my SMSF but rented to me

Initiate

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Replies 3

My SMSF owns a house on a large block of land, let out as an AirBNB, 2 hours drive away from where I live.

My Question:

  • Can I rent some of that land from my fund to put a on caravan so I have some where to stay when cleaning - I am retired.
  • The value of the portion of the block housing the caravan would be $40,000 comming in at less that 5% of the assets of the fund ( In house asset rules).
  • I would be the owner of the caravan.
  • I would lease the land at the commercial rate as outlined by a valuer. Comlpleting a formal rental agreement through a local realestate agent. Satisfying the sole purpose test.

 

Is this a posible alternative to me driving backwards and forwards as I do at the moment?

 

Your feedback would be greatly apprectiated.

 

 

 

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Most helpful response

ATO Community Support

Replies 0

Hi @KCGellie,

 

Thank you for your reply. We are only able to provide general advice. As the fund is Audited each FY it is important that investment restrictions are adhered to. Emailing superadvice@ato.gov.au you will receive a written response about your scenario. You can also retain for the purposes of record keeping. 

 

Hope you are keeping well during these trying times.

 

Regards,

Jodie2.  

3 REPLIES 3

ATO Community Support

Replies 2

Hi @KCGellie,

 

Thank you for your post. The website advises - Several investment restrictions apply to transactions involving 'related parties' of your fund and 'relatives of members'. No one associated with your fund should get a present-day benefit from its investments.

Your fund needs to be maintained for the sole purpose of providing death or retirement benefits to your members or their dependants.

 

You can write in to superadvice@ato.gov.au for your specific scenario and they will provide further assistance.

 

Hope this helps.  

 

Regards,

Jodie2.  

Initiate

Replies 1

Hi Jodie2

 

I thought it may be fairly simple with the less than 5% in house assets rule covering personal use by trustees and arms length transactions. But you are thinking more complex?

Most helpful response

ATO Community Support

Replies 0

Hi @KCGellie,

 

Thank you for your reply. We are only able to provide general advice. As the fund is Audited each FY it is important that investment restrictions are adhered to. Emailing superadvice@ato.gov.au you will receive a written response about your scenario. You can also retain for the purposes of record keeping. 

 

Hope you are keeping well during these trying times.

 

Regards,

Jodie2.