This is a new service – your feedback will help us to improve it.

  • 76 Online
  • 9186 Members
  • 14615 Posts

Re: SMSF Joint Ownership in a Property

Reply

Newbie

Views 100

Replies 1

hello, is it possible for Joint Ownership with a property that is already in the SMSF.

ie: SMSF owns Property in WA, this property is to be sub-divided and developed on and I am aware this cannot be done in the SMSF, however, unfortunately it was purchased in this entity. Can another entity purchase a share from the SMSF? So, 50/50 Joint Ownership and then the other entity uses their funds to develop the property.  Is this possible?
Thanking in advance for any insight Smiley Happy

1 ACCEPTED SOLUTION

Accepted Solutions
Highlighted

Best answer

ATO Certified

MVF
Devotee

Replies 0

This issue can be very involved and very easy to get wrong, and if you do get it wrong your fund could become non-complying and then be subject to very high rates of taxation. It also raises potential capital gain tax issues for the SMSF as they would have to sell part of the property at market value utilising what is known as " the arms length principle".  https://www.ato.gov.au/Super/Self-managed-super-funds/Investing/Tax-on-income/Non-arm-s-length-incom...

 

Furthermore, this forum is not designed to answer complex issues such as the one you have posted.

The better way to approach this is to apply for ATO SMSF specific advice which will give you the opporunity to discuss the issue with the ATO officer that is going to provide the written response, however be aware the ATO can only tell you how the super law works and can not give you any advice on how you should proceed with this issue.

 

You need to provide as much information as possible if you wish to apply for SMSF specific advice, because if you miss anything out the response may not cover vital issues that could impact on what you propose to do.

 

Here is a link to a SMSF annual conference report that discusses the issue of SMSF property development in detail.

 https://www.dbalawyers.com.au/wp-content/uploads/2014/09/F4_Property-inside-an-SMSF_paper.pdf

 

ATO general super line 13 10 20

1 REPLY
Highlighted

Best answer

ATO Certified

MVF
Devotee

Replies 0

This issue can be very involved and very easy to get wrong, and if you do get it wrong your fund could become non-complying and then be subject to very high rates of taxation. It also raises potential capital gain tax issues for the SMSF as they would have to sell part of the property at market value utilising what is known as " the arms length principle".  https://www.ato.gov.au/Super/Self-managed-super-funds/Investing/Tax-on-income/Non-arm-s-length-incom...

 

Furthermore, this forum is not designed to answer complex issues such as the one you have posted.

The better way to approach this is to apply for ATO SMSF specific advice which will give you the opporunity to discuss the issue with the ATO officer that is going to provide the written response, however be aware the ATO can only tell you how the super law works and can not give you any advice on how you should proceed with this issue.

 

You need to provide as much information as possible if you wish to apply for SMSF specific advice, because if you miss anything out the response may not cover vital issues that could impact on what you propose to do.

 

Here is a link to a SMSF annual conference report that discusses the issue of SMSF property development in detail.

 https://www.dbalawyers.com.au/wp-content/uploads/2014/09/F4_Property-inside-an-SMSF_paper.pdf

 

ATO general super line 13 10 20

Top Solution Authors