This paper was presented by Phil Broderick on SMSFs Engaging in Property Developments, at the Ninth Annual SMSF Conference of the Television Education Network, on 4-5 September, 2014.
Self managed superannuation funds (SMSFs) have been carrying on property development activities ever since they came into existence. Yet despite that, there is still a common concern that such activities will cause the SMSF to become non-compliant, or subject to penalties, on the basis that such activities, and in particular undertaking a property development business, are prohibited.
In this paper, Phil has examined whether an SMSF can carry on a business. He has reviewed the provisions of the SIS Act and SIS Regs, and the tax acts, that must be considered when an SMSF carries on property development activities. Thirdly, he has reviewed various structures under which an SMSF can carry out property development. And finally, he has examined issues arising out the use of related party builders when undertaking property developments.
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