What property can an SMSF buy?

Answer

You can use your SMSF to buy residential or commercial property. However, any property held by your SMSF must meet the sole-purpose test of providing retirement benefits to fund members, or a benefit to their dependants if a member dies before retirement.

 

Residential property

There is nothing to stop an SMSF from investing in residential property as long as you don’t buy the property from a related party of a member.

For example, you can’t own the family home through your super fund. Nor can you rent a residential property owned by your SMSF to a fund member, or to their related parties.

However, you can buy an investment property that you rent to tenants who are not fund members or relatives.

Commercial property

You can also hold commercial property, including your own business premises, through your SMSF.

While the property still needs to meet the sole-purpose test of providing retirement benefits to its members, when dealing with commercial property, an SMSF can generally buy the property and lease it back to a member or a related party of the fund – including the member’s business.

An arm’s length sale price and lease arrangement is especially important when acquiring and/or leasing property to a member or related party of the fund.

We recommend that you speak with a financial adviser to help you decide if buying property through your super fund is right for you.

 

Important information

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It’s important to consider your particular circumstances and read the relevant Product Disclosure Statement or Terms and Conditions before deciding what’s right for you. This information hasn’t taken your circumstances into account.

This information is provided by AMP Life Limited. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relation to products and services provided to you. All information on this website is subject to change without notice.