Hi Forumites,
I’m about to start a part time business with my fiancée :). We were looking at setting it up as a company and running it that way. What I wasn’t sure about was a while back I enquired about starting a SMSF(probably look at organising it in the next 12months) I understand one way of setting a SMSF was to start a company and do it that way. Would I need to start another company just for that purpose or could I use the same company structure? Thanks TonyTony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
Bump
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
SMSF would be diff to the company you want to trade from as the SMSF is a non trading entity and structure.
Also when you do end up buying something with your SMSF the company bear trust can only be used once.Mick C | Shape Home Loans
http://www.shapehomeloans.com.au/
Email Me | Phone MeSame Banks. Better Rates. Served With a Passion.
I’ll have a go at explaining SMSFs in a manner that is relatively easy to understand:
There can be a couple of “companies” associated with a SMSF.
There is the SMSF itself (which is a super fund, not a company). It will have an ABN and a tax file number. Let’s say the Super Fund is called Smith Super Fund.
You may optionally have a Corporate Trustee for the Super Fund. Let’s say the Corporate Trustee is called ABC Pty Ltd. The bank account would be called ABC Pty Ltd ATF Smith Super Fund. The ATF means “as trustee for”.
You do not have to have a corporate trustee, however a couple of benefits are:
– Enabling the SMSF to be eligible for 80% loans for residential property purchases rather than 72%
– A SMSF with a Corporate Trustee can operate with just one member if it so desires
– Asset protectionImagine if you had a husband and wife duo that decided to forego the corporate trustee option and instead just have their own selves as the trustees of the fund. Then one of them passes away. Suddenly the fund is non compliant and needs to become compliant quick smart (ie add another member, or convert to corporate trustee). SMSF administration is the the last thing you feel like doing after losing a loved one, so among the other reasons, it’s best to get your structures right at the start.
Over and above the corporate trustee, there needs to be a separate PTY LTD set up when you want to purchase property in a SMSF where a mortgage will be involved. This PTY LTD will be the legal owner of the property for as long as the loan exists. Let’s call this PTY LTD company “Smith Holdings Pty Ltd”. There would then be a “bare trust” set up. It is neither a super fund nor a company. Smith Holdings Pty Ltd is known as a “security custodian” and exists to be a trustee for bare trust.
NONE of the above mentioned super funds, companies, or bare trusts are allowed to “run a business” as has been previously mentioned. They are merely allowed to gather income producing assets and look after the super fund’s money.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
Thanks for the replies everyone. I thought it would be a bit tricky having my own SMSF through a company with other members.
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
Hi Mick
Hate to say that is actually not correct the Security Trustee Company can be the Corporate Trustee of a number of Bare Trusts.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
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