The decision of the Victorian Court of Appeal in Australasian Annuities Pty Ltd (in liq) v Rowley Super Fund Pty Ltd 1 (Rowley Super) concerns the ability of a liquidator to claw back contributions made to a superannuation fund where such contributions are made as a result of a director breaching his fiduciary duties to the corporate trustee of a discretionary trust.
In the first part of this article, I examined whether a self-managed superannuation fund (SMSF)1 can carry on property development activities and a property development business, and what superannuation and tax laws must be considered when an SMSF carries on property development activities. In the second part of this article, I examine various structures under which an SMSF can undertake property development, or invest in an entity which undertakes property development activities. Legislative references are to the Superannuation Industry (Supervision) Act 1993 (SISA) or the Superannuation Industry (Supervision) Regulations 1994 (SISR).
Self-managed superannuation funds1 (SMSFs) have been carrying on property development activities ever since they came into existence. Such activities are either done directly by the SMSF or more commonly through a structure (typically, a trust). Yet, despite this, there is still a common concern that such activities will cause the SMSF to become non-complying, or subject to penalties, on the basis that such activities, and in particular undertaking a property development business, are prohibited