Diversify into SMSF lending

Diversify into SMSF lending



Yes - You now have the option of purchasing property & borrowing against that property in your very own Self Managed Super Fund (SMSF).


Whilst this strategy is not for everyone, it does open up opportunities for many who either do not have equity in their home or the savings required to purchase a property in

the traditional way. More importantly however, it gives Australians the opportunity to take control of their super and invest in direct property of their choice (within

certain guidelines as outlined in the SIS act.)


In order to access the funds in your superannuation to purchase a property, you first need to establish your own Self

Managed Super Fund. More commonly,  a new company is created that acts as trustee for the superfund. 

The purchase of the property is then done through a separate Trust that is set up for the sole purpose of buying an

individual property & borrowing against this property.  Once the borrowings are paid out, the property is then transferred

to the SMSF directly.


There are restrictions on the type of property you can buy in your superfund; the property must be used for investment purposes only ( i.e. you cannot live in the property),

you cannot develop or subdivide the property and you cannot purchase it from a related entity). Commercial property can be owner occupied by a business.  There are

other restrictions on the types of properties you can purchase, so seeking expert advise is paramount.


Your employer can pay directly into your own SMSF as can your tenant, this is a great way of assisting with the mortgage repayments and therefore not affecting your pre

tax cashflow. You can also salary sacrifice into your SMSF, again assisting with the repayments / debt reduction.


A very good benefit of purchasing property in your SMSF is that upon retirment age, should you sell the property, you are not subject to Capital Gains Tax.  The sale

proceeds remain within the fund and income tax does not apply!


Whilst we can assist with the property purchase and finance strategy, we have specialist alliance partners whom we refer, to establish the legal structures.



If you would like to discuss your potential SMSF options or register for one of upcoming SMSF sessions, then contact us today!