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smsf buying a business

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Hi, I am enquiring as to weather or not it is possible to start up a business within a SMSF

It will be tractor slashing/mowing business operating of a weekend with aprox outlay of 5k and all income going back into the SMSF

There are no related parties involved in purchasing of the tractor/slasher and I believe it is not a hobby as it is generating an income

I (Director) would be operating the tractor under registered ABN etc

 

Look forward to your resposne

 

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Hi @Erinruby,


Welcome to our Community!


The super laws don’t state what types of investments a SMSF can or can’t invest in, and a SMSF isn't prohibited from carrying on a business, however the business must be:

  • allowed under the trust deed
  • operated for the sole purpose of providing retirement benefits for fund  member.

You can find more information about the sole purpose test and other regulatory provisions on our website.


As the information we provide here is general in nature, you may want to request SMSF specific advice if you’d like us to interpret how the super laws would apply to your specific circumstances. You may also wish to seek independent professional advice through the services of a registered tax practitioner.

 

Thanks, JodieH.
 

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SX
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@Erinruby

Hi, 

Why would you perfer to run that business within the SMSF?

I guess if i were you i rather to run the business outside of SMSF (sole trader/company etc) then contribute the Profit from business back to the SMSF?

is this a better way?

 

SX

kezhengxie@gmail.com

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Hi @Erinruby,


Welcome to our Community!


The super laws don’t state what types of investments a SMSF can or can’t invest in, and a SMSF isn't prohibited from carrying on a business, however the business must be:

  • allowed under the trust deed
  • operated for the sole purpose of providing retirement benefits for fund  member.

You can find more information about the sole purpose test and other regulatory provisions on our website.


As the information we provide here is general in nature, you may want to request SMSF specific advice if you’d like us to interpret how the super laws would apply to your specific circumstances. You may also wish to seek independent professional advice through the services of a registered tax practitioner.

 

Thanks, JodieH.
 

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Thanks for your reply greatly appreciated Smiley Happy

 

I guess going through the SMSF gives us the ability to purchase the assets to run the business.

 

Please explain you option if you can a bit more: and any benefits you may see

 

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