Solid Future For Super In Property

It has been well documented that Self Managed Super Funds (SMSF’s) have started taking advantage of changes made late in 2007 to the Superannuation Act. SMSF’s can now use installment warrants to purchase property and leverage from borrowed funds.

With the recent uncertainty in the Australian and global financial markets SMSF’s have found comfort investing their money in property. The process is simple and easy and far out ways the benefits of traditional negative gearing.

Latest figures show new SMSF’s established in the last financial year almost doubled from the proceeding year, taking the total number of SMSF’s to 372,589.

Real property currently only comprises of 10% of the total assets held in SMSF’s. This figure is sure to grow once the benefits of leveraging into real property using your SMSF are widely recognised.

There are two main benefits for SMSF’s; firstly they only pay 10% Capital Gains Tax (CGT) and no CGT if the Fund is in Pension Phase.

Secondly contributions made to the SMSF are taxed at 15% leaving 85c in every dollar to contribute to the property compared to as little as 55c with your traditional negative gearing.

Other benefits include:

• The ability to invest in property using a SMSF with as little as 15% of the purchase price.

• Deductible interest payments.

• The ability to end the warrant and take ownership of the property at any time up to the maturity date

• The SMSF’s other assets are protected from risk.

• Super Funds are taxed at 15%

SP Wealth have a warrant product tailored to comply with the new legislation and can also assist with the selection of the investment property.

For more information on the new legislation visit the ATO web site.

http://law.ato.gov.au/atolaw/view.htm?locid='PAC/19930078/67(4A)'#67(4A) 

Can a Super Fund Borrow to purchase an Investment Property?

In September 2007, the Federal Government legislated to permit self managed super funds (SMSFs) to borrow money to purchase investment property, provided that the terms of borrowing satisfied strict conditions set out in the legislation

Prepared in consultation with leading Australian legal and accountancy experts, SP Warrants are designed to enable your SMSF to borrow in a manner that satisfies the government's strict conditions.

What is an SP Warrant?

It is an arrangement for borrowing that is fully explained in our Disclosure Statement, available upon request through the form below.

SP Warrant Benefits

• The loan is borrowed directly from a bank on terms approved by you.
• You can borrow to purchase a property independently sourced by yourself or introduced to you by our associated property agency, SPW Realty.
• You can borrow to purchase any class of investment property (residential, commercial, retail or industrial) for legitimate investment purposes.
• You arrange the property lease, and your SMSF directly receives all rental income.
• The property can be sold at any time.
• The loan can be paid out at any time permitted under the bank loan.

What are the Costs?

Costs are explained in detail in the Disclosure Statement, available upon request through the form below.

How do I apply for a Warrant?

An application form is emailed to you upon request through the form below.