One way to free up capital in your self-managed super fund before you reach the preservation age of 55 is to put/transfer your business property into your SMSF (self managed super fund). By doing this you will release money from your superannuation ahead of time, free up the equity in your company’s premises and give your business a cash injection to expand or provide cashflow. And there will probably be no capital gains tax on the transfer to the SMSF, as small business CGT concessions will come into play. But stamp duty may apply on the transfer, depending on which state you live in and the current ownership of the property.
Such transactions can be done only on an arm’s-length basis and the sale must be at the market rate. If there are insufficient funds in the SMSF to pay for the entire property, it is possible to take out a limited recourse loan. Since September 2007, SMSFs have been able to borrow money to buy property or equities. Limited recourse means the lender has no recourse to any other assets in the SMSF should the fund default. Another consideration is the contribution limits, $150,000, or $450,000 with the brought forward rule.