What can I invest in?
YOU CAN INVEST IN ALMOST ANYTHING:
- Must be acceptable by the trust deed
- Will need to be part of your investment strategy
- Needs to be in the Fund’s trustee name (e.g. if you’re planning on investing in crypto, you’ll need a separate wallet that belongs only to the Super Fund).
- Will need to meet the sole purpose test.
Residential, commercial and business real property (local and overseas)
You can invest in residential or commercial property through your SMSF, but there are a couple of rules:
- Residential property needs to be rented out to someone who isn’t related to you and you can’t enjoy the use of it – so that holiday house in Noosa is out, unfortunately!
- You can’t improve a property that has a borrowing on it.
You can own multiple properties in one SMSF, and have multiple mortgages. There might be other reasons to hold separate properties in a separate fund (for example, Land Tax), but this is something we can walk you through. - If you’re investing in commercial property or business real property, you can rent it out to a related party (for example, a business you own). Commercial property is defined by it’s character, for example if a house is rented under a commercial lease to a business, and used as a commercial property, it’s classified as business real property.
- A Self Managed Super Fund has a 15% flat tax rate ( 10% capital gains tax rate if you’ve owned the asset for over 12 months).
Listed Securities
A listed security includes shares, bonds, units, or anything listed on a public stock exchange).
If you hold shares in your own name, your SMSF can purchase these shares from you as long as they are purchased at market value or you can transfer these in as a contribution.
Crypto
Cryptocurrency is any form of currency that exists digitally or virtually and uses cryptography to secure transactions.
We encourage our clients to keep their currency in exchanges. This makes it easier to track, meet the sole purpose test and for audit purposes. It’ll also give your balances reliability and make transactions more transparent. If you need help getting started we can set your fund up with a trading account
Collectables
Collectables are assets that derive value from their collectability. They can include things like artwork, stamps, coins, rare/collectable cars and wine.
These assets don’t typically derive consistent income, unless you are renting them out to businesses. This is something to consider when investing in collectibles for your retirement.
Any collectable assets will need to be purchased in the name of the trustee, and you’ll need to have insurance on them.
These assets don’t typically derive consistent income, unless you are renting them yourself or out to other businesses. This is something to consider when investing in collectables for your retirement.
Loans
You can loan the money in your SMSF to unrelated parties in order to generate interest.
You’ll need to set up a loan agreement with the person you’re loaning money to and if it’s a secured loan you will need to register your interest, and you’ll need to collect interest and establish a repayment schedule.
Precious Metals
You can invest in precious metals such as Gold and Silver.
The ways to invest in these metals are typically gold or silver coins, gold or silver bars/bullion or exchange traded funds (ETFs).
You can store these in your home or place of business (although it should be securely and not on display) or in a mint or bank.
They cannot be available or used for personal use.
What can’t I invest in?
YOU CAN’T INVEST IN:
- Shares or units of a related party
- A residential property you’re planning on living in
- Any asset that is not being held for the sole purpose of supporting you in your retirement.
Not sure if your investment is compliant? Reach out to our team for a chat.
With an SMSF you can invest in almost anything!
Looking to invest but not sure if it meets the right criteria? Our team can help you make the call.