All Topics / Help Needed! / mixing superannuation and personal income

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  • Profile photo of wade anthonywade anthony
    Participant
    @wade-anthony
    Join Date: 2007
    Post Count: 53

    Is it possible to mix superannuation and personal income?
    ie. if you purchased a vacant block of land through super and then use personal borrowings to fund the building of the property, would this work and if so how? Would there be any benefit? Would it be to complicated and not worth going there?

    Profile photo of Scott No MatesScott No Mates
    Participant
    @scott-no-mates
    Join Date: 2005
    Post Count: 3,856

    you may need specialist advice on that because smsf generally cannot get into speculative development works.

    Profile photo of Jacqui MiddletonJacqui Middleton
    Participant
    @jacm
    Join Date: 2009
    Post Count: 2,539

    As Scott says, you'll need advice on that.  Richard Taylor (userid Qlds007) on this forum would know. 

    I believe you will find you definitely cannot "borrow" to do the build.

    If you can't work as an individual together with your super fund, you might be able to get around it by something like this:  Super fund owns land, and a company owned by you and for which you are the director, builds on the land…

    Talk to Richard.

    Jacqui Middleton | Middleton Buyers Advocates
    http://www.middletonbuyersadvocates.com.au
    Email Me | Phone Me

    VIC Buyers' Agents for investors, home buyers & SMSFs.

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213

    Yes it is possible.

    You could personally lend the SMSF the money.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of Jarrod Rogers CPAJarrod Rogers CPA
    Member
    @jarrod-rogers-cpa
    Join Date: 2011
    Post Count: 8

    A good website on this would be SMSF Academy.  An ex-boss of mine Aaron Dunn runs it.  (I have no finanical ties to him, but his content and blog are very good.)

    To answer a small part of your question, yes it would be complicated!  There are not just tax rules but super rules to consider.  You need to do things scrictly by the book and at arms length.

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Agree with Terry nothing to stop you personally lending funds to the Bare Trust which undertakes the construction.

    Underaking a development is a bit out there and if considered as running a business or trading will be an issue but otherwise all good.

    Unfortunately you wont find any lender finance a Bare Trust in construction or indeed lend against vacant land.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

Viewing 6 posts - 1 through 6 (of 6 total)

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