Hi Aaron a bit too much time on my hands today, so might be a perfect time to ring the ATO and get the lowdown straight from the horses mouth.
Postscript : About a 48hr turnaround from the ATO on this sort of question, will let you know what I find out.
What I'm hoping for is that any tax paid in the USA is credited here. The interesting part will be if you paid 30% in the USA but only need to pay 15% or nil tax here (if SMSF in pensions phase) will the 15% or 30% paid be a credit like dividend imputation. Should know before Christmas.
Our options are to buy in our own names via a USA LLC, JV between the SMSF and ourselves (50/50 or 75/25) or just the SMSF.
SURFING THE NET
Came across
http://www.myusaproperty.com.au/smsf.php
There are many benefits of investing
in US properties using your SMSF.
- Lower taxes on the net income of your US Property.
- Decreased capital gains tax upon disposal of your US property.
- Foreign tax credit benefits.
- No income tax on net rental or capital gains tax in pension phase.
Benefits of investing in US properties using your self managed superannuation fund - SMSF
01.
Net income on your US property investment will be taxed at 15%, compared to 30% for companies or for individuals up to 46.5%.
02.
Capital gains tax upon disposal of your US property (held over 12 months) will only be taxed at 10%, compared to 30% for companies or for individuals:
15.75% with taxable income between $35,000 and $80,000;
19.75% with taxable income between $80,000 and $180,000;
23.25% with taxable income exceeding $180,000.
03.
Any US tax payable by the SMSF in the US on net income or capital gains will be offset against any income tax payable in Australia by the SMSF by way of a foreign tax credit.
04.
Once a member of a SMSF reaches the age of 60 and in pension phase, the SMSF pays no income tax on net rental income or capital gains tax in Australia for that member of the fund.
Important Consideration
As an asset protection strategy, it is not recommended that the SMSF invests directly in US properties. This is because in the event of any litigation arising from the US property investment, the assets of the SMSF will be potentially exposed.
In this regard, it is recommended that a special purpose vehicle be incorporated to invest in US properties (such as a Australian Pty Ltd company as trustee for a Unit Trust, or in some cases a US incorporated Limited Liability Corporation ("LLC"), with the SMSF owning all the units in the Unit Trust or all the shares in the LLC.
Note
The above is only general tax treatment and is not advice. Please seek appropriate professional advice before investing.
