2 Comments Super, Managed Funds, Wealth, Insurance, SMSF, Pensions
It's been said that the members of the SMSF are usually also the trustees. Meaning that the members run if for their own benefits and are must be responsible for complying with the super and tax laws. But there are some strict set of rules to be followed. Maybe the best thing is if you have other assets in your name, use them as collateral to secure a loan from a bank or other financial institution and then on-lend to your SMSF. Also the loan from the bank will carry a lower interest rate than if it were lent directly to the SMSF.
You and your wife are members of a Self Managed Super Fund, and are looking at lending money from the SMSF to your personally to develop a property which you own jointly
Based on this information, you are describing an â€˜In House Asset,â€™ where you lend money to yourself to create wealth.
In house Asset is classified as:
An asset of the fund that is a loan, or an investment in, a related party of the fund, an investment in a related trust of the fund, or asset of fund subject to lease or lease arrangement between a trustee of the fund and a related party of the fund.
There is a restriction on the amount of money the SMSF can lend which is 5% of the account.
There could be better way to implement your strategy.