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Why should you plan to buy SMSF property?

An SMSF property is a private superannuation fund that members administer themselves rather than having superannuation fund providers handle it on their behalf. Since every member serves as a trustee, SMSFs are also distinct from industry- or retail-based super funds in this regard. Consequently, SMSFs are a fantastic method to take charge of your retirement.

You are in control and can decide how much money you save for retirement, what investments you make, and how much risk you are ready to accept.

There are two critical benefits to SMSF property investing. The main benefit of using an SMSF is having control over your finances. Since you are the fund’s trustee, you have total control over any financial decisions on its behalf.

Typically, your firm makes these donations on your behalf. However, you have the option to provide more. When investing in real estate through an SMSF, you have options. This can be more profitable with the right strategy than sticking to the conventional superannuation paradigm.

Reasons to buy SMSF property

  • Investment Preference

Investment control and the more excellent selection of investments available to SMSF members than industrial and retail super funds, including residential and commercial real estate, collectables, direct shares, and term deposits, are two of the main advantages of an SMSF. Additionally, you will have access to derivatives to reduce portfolio risk or provide downside protection.

The ability of small company owners to acquire commercial real estate through their SMSFs and then lease it back to their companies is one of the primary reasons. 

  • Tax reduction

An SMSF gives you greater flexibility than any other superannuation structure in terms of contributions, the timing of payments, and allocating profits to certain members. As a result, trustees and their expert advisers have the chance to make use of an SMSF’s unique flexibility to lower the overall tax.

  • An SMSF may borrow money to purchase real estate.

SMSF members may now acquire huge single assets like commercial property that would otherwise be out of their price range, thanks to the regulations that let SMSFs borrow. You, another trustee, or anyone connected to the trustees cannot reside in residential investment properties acquired through an SMSF. Steer clear of “renovator’s dream” purchases. Using borrowed money is permitted for property maintenance but not for property improvement. As a result, you cannot purchase an empty parcel of land to develop a building on it eventually.

  • You are in charge of compliance.

The ability to borrow money to buy SMSF property comes with extremely severe restrictions and duties that you may not be acquainted with because they do not exist outside of an SMSF. As a trustee, you must become knowledgeable about your rights and obligations since the ATO will hold you accountable. There are costly consequences for getting it wrong, ranging from ATO trustee fines to stamp duty concerns. Even if they ask a third party to help or delegate a decision to another member or trustee, all trustees are individually responsible for any choices the fund takes.

  • Benefits from taxes before and after retirement

The tax advantages of purchasing a home through your SMSF begin far before retirement. Once you’ve owned the property for more than a year, the capital gains tax rate drops to only 10%, and the rental income from your SMSF-owned property usually is subject to a low 15% tax rate.


Using an SMSF to invest in real estate is, as you can see, a realistic alternative. You can even make changes to such property in the appropriate circumstances. It’s crucial to remember that not everyone should employ this tactic. It all depends on your particular circumstances. In a nutshell, Self-Managed Super Funds are now the most effective retirement savings category available.