Boost your retirement plans and take over your superannuation management by purchasing investment properties using your funds as the deposit.
It was once the domain of wealthy baby boomers, but now younger Australians on average incomes have begun using self-managed superannuation funds (SMSFs) to invest in property. Some have realised that their current retirement strategies may not meet their lifestyle preferences when they reach retirement.
Like other superannuation (super) funds, self-managed super funds (SMSFs) are a way of saving for your retirement. The difference between an SMSF and other types of funds is, generally, that members of an SMSF are the trustees. This means the members of the SMSF run it for their own benefit.
People set up their own SMSF for control, flexibility and personal investment choice. You get to decide on your fund's investment strategy and choose what your fund invests in and like all super funds the tax rate of an SMSF is 15 percent.
You can only buy property through your SMSF if you comply with the rules.
SMSFs can use borrowed monies to assist in purchasing a residential investment property within the super fund. The property must be held in trust for the SMSF until the loan is repaid.
Rights of recovery against the SMSF are limited to the secured property. All other assets held in the SMSF are protected.
It may be possible to claim the interest paid on the loan and expenses as deductions against rental income for tax purposes.
Rental income from the investment property can be used to repay the loan.
The loan structure is designed to easily integrate with most SMSFs.