Accessing Superannuation funds for PI

From: Crispin Dobson


Does anyone know how to use funds in a DIY Super fund to leverage in to property investment? I am aware that super funds cannot borrow, but they can form partnerships with entities that can. What are the pros and cons? How is it done?

Thanks,
Crispin
 
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Reply: 1
From: Dale Gatherum-Goss


Hi

In a word, it can't be done without causing problems UNLESS your superannuation fund buys commercial property without borrowing money.

Some of the older rules allowed you to use a unit trust to get around this situation, but, they basically closed this off.

Sorry

Dale
 
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Reply: 1.1
From: Paul Zagoridis


Welcome back Crispin. Missed ya lad!

Also the lawyers who work out how to make these deals happen charge upwards of $450 per hour and don't do them unless millions are at stake (they won't risk their fees).

Someone, somewhere will work out how to do it. By the time it trickles down to Mums and Dads it'll get closed off the next year.

I suspect the way will come through structuring via an unrelated entity. e.g. units in an unrelated unlisted property trust.

The law is quite adamant you shouldn't risk your super by leverage. Of course you can invest it managed funds and direct share investments and those companies can have debt. But it's a bit out of reach for average Mums and Dads.

Paul Zag
Dreamspinner
The Oz Film Biz site is archived at...
http://wealthesteem.dyndns.org/
 
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Reply: 1.1.1
From: Nigel W


On 3/18/02 3:29:00 PM, Paul Zagoridis wrote:

>Also the lawyers who work out
>how to make these deals happen
>charge upwards of $450 per
>hour and don't do them unless
>millions are at stake (they
>won't risk their fees).

More in the region of $700/hour Paul!

>The law is quite adamant you
>shouldn't risk your super by
>leverage. Of course you can
>invest it managed funds and
>direct share investments and
>those companies can have debt.
>But it's a bit out of reach
>for average Mums and Dads.

The system is unfortunately skewed towards trying to keep Mr & Mrs Joe Average safe and just well-off enough not to need the pension. But unfortunately not rich enough to enjoy more than a meagre existence.

Which is, I guess, why we're all "here". Just not gonna accept an ordinary life!
 
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Reply: 1.1.1.1
From: Paul Zagoridis


On 3/18/02 5:21:00 PM, Nigel W wrote:
>On 3/18/02 3:29:00 PM, Paul Zagoridis
>wrote:
>
>>Also the lawyers who work out
>>how to make these deals happen
>>charge upwards of $450 per
>>hour and don't do them unless
>
>More in the region of $700/hour Paul!

I'm so out of touch with bleeding edge consulting

>The system is unfortunately skewed
>towards trying to keep Mr & Mrs Joe
>Average safe and just well-off enough
>not to need the pension. But
>unfortunately not rich enough to enjoy
>more than a meagre existence.

As an ex-consultant (not financial services) I regret that our advice MUST be conservative and prudent. No wonder most people could make more money by doing the opposite of what most advisers suggest. But some people would lose their shirt.

>Which is, I guess, why we're all "here".
>Just not gonna accept an ordinary life!

hehehe! Yes exactly.

Dreamspinner
The Oz Film Biz site is archived at...
http://wealthesteem.dyndns.org/
 
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Private Super and unit trust

Reply: 2
From: Brett Burt


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You hang a unit trust off the DIY SF. The super fund buys units in the =trust and the trust borrows to buy ip's or whatever as long as it is in =keeping with your DIY super statement of how you are going to invest and =make money. Any accountant can do this for you.

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You hang a unit trust off the DIY SF. The super fund =buys
units in the trust and the trust borrows to buy ip's or whatever as long =as it
is in keeping with your DIY super statement of how you are going to =invest and
make money. Any accountant can do this for =you.

------=_NextPart_000_0099_01C1CFE1.662B75C0--
 
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Private Super and unit trust

Reply: 2.1
From: Dale Gatherum-Goss


Hi Brett

With due respect, you might like to keep up to date with the laws in this regard, this issue was effectively closed down about 18 months (or so) ago.

Any accountant will tell you this.

Have fun

Dale
 
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Private Super and unit trust

Reply: 2.1.1
From: Paul Zagoridis


Sadly true...

Can't remember if it was S.L.A.B. 3 or S.L.A.B. 4.

Either way the politicians used a couple of SLAB's to kill the perk.

Paul Zag
Dreamspinner
The Oz Film Biz site is archived at...
http://wealthesteem.dyndns.org/
 
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Private Super and unit trust

Reply: 2.1.1.1
From: David B


Can a DIY super fund loan money to a Company Trustee & Family Trust, the loaned money is used for deposits on Investment properties, and the super fund gets a interest stream from the these entities.

Regards,

David
 
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Private Super and unit trust

Reply: 2.1.1.1.1
From: Dale Gatherum-Goss


Hi

Not if the trust and trustee are "related entities" to the super fund.

Changes over the last couple of years have wiped out this approach . . . or, at least, it may as well have wiped out the old advantages.

Have fun

Dale
 
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Private Super and unit trust

Reply: 2.1.1.1.1.1
From: Paul Zagoridis


Off the top of my head a SMSF cannot hold more than 5% of its assets in an in-house asset (pretty much anything involving a related party).

Paul Zag
Dreamspinner
The Oz Film Biz site is archived at...
http://wealthesteem.dyndns.org/
 
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