Super can be very tax-effective and beneficial for Perth Property Investors for 3 reasons:

  1. You can buy a property in your self-managed superannuation fund (SMSF);
  2. You can borrow to buy a property for your SMSF; and
  3. You can contribute a commercial property in specie (ie “as is”) from yourself or your family trust into your SMSF.

Superannuation is sexy!The benefits of taking your superannuation seriously are:

  • Superannuation is a legitimate tax haven. You will not only save tax now but throughout your entire life.
  • When you reach retirement you can draw an income from superannuation completely tax free.
  • With a SMSF you control where your superannuation money is invested. You control your biggest asset. As you control the investment decisions, you choose where your superannuation is invested.

So why not own Property through your SMSF?

Property Investments Increasing in SMSFMany people reeling from the recent up and down in the share market and the performances of their shares in their superannuation fund. It may now be time to look at other options…

How about:

  • You purchase a rental property and put it straight into your SMSF; or better
  • You purchase a commercial property and in put it into your SMSF; or even better
  • You transfer / sell a commercial property you already own and put it in your SMSF

Amendments to the Super Legislation in 2007 permit superannuation funds to borrow money of a “limited recourse” nature for investment purposes in certain circumstances. The amendments provide an exception to the general prohibition of borrowing money by a SMSF.

The intent of the amending legislation is to permit a SMSF to invest in limited recourse borrowing arrangements.

SMSF is permitted to enter into a limited recourse borrowing  arrangement that meets the various  criteria, such as  the borrowing is applied to the acquisition of an asset; and the asset is held on trust so that the SMSF acquires a beneficial interest in the asset.

A trustee of a SMSF fund may borrow to acquire the asset from the bank or from himself  and on-lend to the SMSF.

Your financial adviser can advise you if it works for you and the experienced Superannuation / Taxation Lawyers at Murfett Legal will draft the various documents for you in order to transfer your commercial property into your superfund without paying capital gains tax, transfer duty or GST.

As we said, SUPER IS SEXY!

If you have a general question about buying property using your Superannuation, please leave a reply below and I will endeavor to answer it.

This information has been prepared by Murfett Legal Pty Ltd ACN 120 362 825 for general information purposes only, without taking into account any potential investors’ personal objectives, financial situation or needs. Before acting on this general information, you must consider its appropriateness having regard to your won objectives, financial situation and needs.

In addition, superannuation fund trustees should obtain their own specific advice as to whether a particular investment or loan is permitted by superannuation laws, allowable with regard to their SMSF investment strategy and otherwise appropriate for their fund. Trustees take full and sole responsibility for decisions regarding loan arrangements and compliance with any changes in superannuation laws and administrative practices during the term of that loan. Before borrowing, trustees should ensure that sufficient cash flow is available to meet interest and any other associated costs during the loan term.


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