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Borrowing by SMSFs to acquire real property - Is it worth all the trouble? paper


Many superannuation savers are borrowing to purchase real property in their SMSFs. Although this strategy delivers advantages for some investors, it should not be forgotten that the necessary regulatory requirements to effectively implement it are extremely complex and there are a myriad of issues and traps that need to be very carefully considered. The focus of this paper is on giving practitioners the necessary tools to properly advise clients who may be contemplating this strategy. It covers:

  • implementing, maintaining and dismantling the structure – what are the prudential, tax and stamp duty issues?
  • overview of the finalised SMSFR 2012/1 and TA 2012/7
  • what are the advantages and disadvantages of this strategy?
  • issues when auditing an SMSF that has implemented this strategy
  • latest developments and strategies
  • case study – comparison of different strategies.

Author profiles

Chris Balalovski CTA
Chris has a career spanning more than 33 years and provides complex commercial as well as legal advice to a broad spectrum of high net wealth individuals and their associated entities. As a taxation and superannuation law specialist, Chris provides high-level accounting and taxation compliance services as well as strategic legal and commercial advice on matters including acquisition, holding and disposal of various assets, derivation of income and incurring of expenses. Chris is the Chairman of the Self-Managed Independent Superannuation Funds Association, which represents the interests of self-managed superannuation funds to Government and authorities. - Current at 25 June 2019
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Simon Conolly
Simon is Manager Strategic Advice at Perpetual Private. - Current at 24 April 2014
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This was presented at National Superannuation Conference .

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Individual sessions

Chasing tax within unit prices or credit rates

Author(s):  Dana FLEMING,  Narelle TOOHEY

Materials from this session:

Large fund issues and the ATO

Author(s):  Stuart FORSYTH

Materials from this session:

SMSF regulatory update

Author(s):  Greg TANZER

Materials from this session:

Living to age 120, the pensions dilemma and other defined benefit conundrums

Author(s):  Barry RAFE

Materials from this session:

Tax issues in successor fund transfers

Author(s):  Ross Stephens

Materials from this session:

SMSF issues and the ATO

Author(s):  Stuart FORSYTH

Materials from this session:

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