The popularity of Self Managed Superannuation Funds (SMSFs) is not surprising given the current economic uncertainty.  In uncertain times, people want more control over their superannuation and a SMSF offers this control.

Over the past five years, SMSFs have grown to be the largest segment of superannuation in Australia with about 600 new Funds established every week. This growing popularity is also due to the availability of some exciting strategies that are both tax efficient and can assist in creating wealth.

The three strategies currently generating the most interest are:

Transfer of Business Real Property to a SMSF

Generally, SMSFs are prohibited from acquiring assets from related parties - such as fund members, their family, and partners as well as related companies and trusts. However in certain circumstances, property defined as Business Real Property (typically business premises), may be transferred into a SMSF.

NSW Stamp Duty concession allows a member to transfer property to a SMSF for a nominal duty of $50 where certain conditions are met.  This can save tens of thousands of dollars in stamp duty.

Combined, these two strategies can allow property owners to restructure their business, family or retirement affairs, taking advantage of the valuable tax concessions within the superannuation environment. As SMSF Specialists, we can help you navigate the various government rules and regulations associated with these transfers.

Borrowing within a SMSF

Are you aware that a SMSF can borrow money under certain circumstances? While SMSFs are generally not allowed to borrow, there are several exceptions including the use of Limited Recourse Borrowing Arrangements to purchase shares or property.

This type of investment borrowing is more complicated than borrowing within your own name and needs careful consideration before implementing but the long-term benefits can be significant.

Transition to Retirement

If you are aged 55 and over and have not considered a Transition to Retirement Pension you may be missing out on some significant taxation savings.

The 'Transition to Retirement' rules allow people aged 55 or over who are still working, to access a portion of their superannuation in the form of a pension.

These pension payments provide additional income that may carry a tax offset or even be tax-free. The additional pension income may enable you to salary sacrifice; and salary sacrificing a portion of your before-tax earnings to superannuation results in reduced income tax. A SMSF simplifies this strategy by paying a pension and receiving contributions all within the same superannuation fund.

For more information about making an SMSF work for you, contact David or I at Rochdale Accounting and Financial Services on 6620 0300

What's New in SMSFs Free Seminar

To help you navigate your way through the complexity of SMSFs, David Shume and I will present a seminar at Summerland House, Alstonville on Thursday 23rd February from 5.45pm. The seminar will benefit anyone with a SMSF or considering starting a SMSF. Places are limited so please book early. Register your place for this free seminar now.

Nick Rose and David Shume from Rochdale Accounting & Financial Services are SMSF Specialist Advisors accredited through the leading industry body, the Self Managed Super Fund Professionals'  Association of Australia (SPAA).

Rochdale Accounting & Financial Services Pty Ltd is a corporate authorised representative of Capstone Financial Planning Pty Ltd AFSL 223135.  The information contained in this article is of a factual nature only and is not intended to constitute financial advice.