We look forward to assisting you to build wealth through property investment and financial services.
HOW WE’LL GET YOU THE BEST FINANCE
We’re more than a loan factory. We start by understanding your goals and circumstances and work hard to find the very best loan products available that meet your needs, today and tomorrow.
1. Understand your starting position and goals
Everyone’s finance needs are different. Our team will take the time learn about what you’d like to achieve, based on your individual circumstances and needs. We’ll help you take control of your finances.
2. You must be buying an investment property, not your own residential property
Your property investment must pass the sole purpose test for superannuation investments. The sole purpose test requires that any super investments be made to provide funds for your retirement, not current benefits (like your own residential home).An investment property can provide rental income for your SMSF, as well as an asset that is likely to grow in value over time, so it satisfies the sole purpose test.
3. If you borrow any of the funds to buy property via your SMSF, there are special rules
If you need to borrow some of the funds for your property investment via your SMSF, then you need to have a limited recourse borrowing arrangement. This arrangement protects
your other SMSF assets from any claims made by your lender if you don’t make your investment property loan repayments. They can only make claims on your non-superannuation assets in that situation.
4. The property asset must be held in your SMSF
This is consistent with the sole purpose test. You can sell the property at any time, but the proceeds must also go into your SMSF. If you don’t sell the property until you retire, you will pay no Capital Gains Tax (CGT).
If you do sell the property before you retire, you will pay a discounted CGT rate of 10% on any profit, provided you hold the property for at least a year.
If you want to keep the property to live in after you retire, you can transfer it from your SMSF into your name, tax-free at its current market value.
5. Your rental income from the property must go into your SMSF
However:
- This income is taxed at the concessional superannuation rate of 15%, which is lower than even the lowest marginal tax rate for individuals. This 15% rate reduces to zero when you retire and draw an SMSF pension.
- You can use your rental income to pay for any tax-deductible property expenses, as well as any SMSF property loan repayments.
How do you set up a self-managed super fund?
If you don’t already have an SMSF, you can set one up contacting an accountant or legal professional who specialises in SMSFs. However, it’s important to understand that there are set-up and ongoing costs, and you need to have a super balance of at least $200,000 to make setting up your own SMSF financially worthwhile.
How we can help
At BUILD House and Land we can help you with buying an investment property via your SMSF. We have Finance Partners with a range of SMSF finance solutions as well as qualifying high-quality investment properties across the east coast of Australia.
The benefits of buying property via your SMSF
Buying an investment property via your SMSF can provide you with the following benefits:
- Capital growth
- Rental income
- Tax benefits due to Australia’s concessional tax rates for superannuation funds
- Wealth protection (because super fund assets cannot be claimed by creditors in legal disputes).
It’s important to buy a high-quality property in a good area to maximise the return on your investment.
SMSF Properties
- Full Turnkey Packages
- Single Contracts
- Wholesale Prices
Property Types
Would yo like to find out how much you could borrow?