There are far too many rules to list but instead we have identified the more common rules that trustees should be aware of:
- Can I borrow to purchase property – Yes. The SIS Act permits borrowings to purchase both residential and non-residential property. The process to purchase property is more complex when purchasing through a SMSF and therefore prior to purchasing property it is recommended that you seek independent financial advice.
- Can I rent my SMSF property – Yes and No. The ATO imposes strict rules on members using the assets of the SMSF for personal use and therefore members and/or their associates are not permitted to use residential property. Members and their associates are permitted to use non-residential property where the property is used by the members/associates business.
- Can I take money out of my SMSF – Yes. The SIS Act permits the withdrawal once the member has met a condition of release. There are different types of releases which can be met and therefore prior to withdrawing funds from your SMSF it is recommended that you seek independent financial advice.
- What can a SMSF pay for – a SMSF can pay for any expense which is directly attributed to the SMSF. Examples of SMSF expenses include – investment fees, accounting & audit fees, regulatory fees and administration fees. If a SMSF owned property then the SMSF can pay for all related rental expenses such as rates, insurance, cleaning and repairs.