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Re: SMSF

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Newbie

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If I set up a SMSF with myself as the only member, how many trustees are required by law? Am I allowed to use the fund to purchase a computer which I will require to purchase shares, keep track of investments etc...?
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Devotee Registered Tax Practitioner

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Am I allowed to use the fund to purchase a computer which I will require to purchase shares, keep track of investments etc...?

 

Technically YES, but hardly any SMSFs do this because of the difficulty of proving that there is no private use.

At a practical level, this probably means showing that you have another computer that is used for all private purposes.

 

Catch 22  -  if you have another computer, then you do not need to buy another in the fund.

 

There is no acceptable level of private use, and there is no apportionment like personal tax claims.

 

The consequences of private use =  fail the sole purpose test  =  putting you whole fund at risk.

 

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Master

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You can set it up using a corporate trustee - rather than 2 individuals if that works out better for you.

 

Computer sounds like a depreciable item under operational expense - but care to be taken regarding private use. 

Best answer

Devotee Registered Tax Practitioner

Replies 0

Am I allowed to use the fund to purchase a computer which I will require to purchase shares, keep track of investments etc...?

 

Technically YES, but hardly any SMSFs do this because of the difficulty of proving that there is no private use.

At a practical level, this probably means showing that you have another computer that is used for all private purposes.

 

Catch 22  -  if you have another computer, then you do not need to buy another in the fund.

 

There is no acceptable level of private use, and there is no apportionment like personal tax claims.

 

The consequences of private use =  fail the sole purpose test  =  putting you whole fund at risk.

 

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