CASE STUDY – Recently Re-married, Jan and Bill Pooled Super Into SMSF To Begin Property Investment

CASE STUDY – Recently re-married, Jan & Bill pooled super into SMSF to begin property investment


Starting again with a fresh beginning our couple, Jan and Bill (not real names), each had experience with several property investments, but some had been sold for separation settlements and costs. With a new life together, aged in their early 40’s, they were told by their advisor and their mortgage broker that property inside their own super fund would have more advantages especially with a low tax rate on investment earnings (15%) and potentially the investment will be all tax free and capital gains tax free in the super fund when they reach retirement. The strategy was to become controllers of their super and wealth. The structure was to start a self-managed super fund (SMSF) and pool their 3 corporate super funds all into the SMSF. This meant they had just over $100,000 and they already had their eyes on the investment.

The broker called us and SuperBenefit arranged the paperwork to start the SMSF – the Trust Deed order, the ABN & TFN application, the Bank account form, and the Requests to roll-over. We met and explained the responsibilities and compliance requirements of SMSF, that they will be members and also Trustees of this special purpose Trust (SMSF). We explained that they will sign a Declaration required by the Australian Tax Office (ATO) which states they understand their responsibilities. They were relieved to know that they would not be left with all the work – that was what SuperBenefit would take care of for them! They had support – all compliance is taken care of and monitored by SuperBenefit.

The papers were signed and the SMSF had commenced. Once monies rolled over from the 3 corporate super funds, they were able to confirm the property deal they had found. The first one fell through, the builder had changed the deal – reduced the extras and it did not have the same potential yield in Jan and Bill’s eyes. So they looked for another opportunity. Five months later there it was – the location was ideal – near transport and shops and schools, ideal for rental appeal. They contacted the broker to do the sums – Martin’s expertise with dozens of loans and dealings with over a dozen banks, meant he could do the numbers before applying, The deposit, the amount to borrow and the costs to set up the bare trust (that will own the property until the loan is paid out) and the limited recourse loan would work.

They were excited – they asked SuperBenefit for the SMSF cheque book, a deposit was paid from the SMSF (if you pay a deposit personally, it will be treated as a contribution to the SMSF, so watch the contribution caps) and the papers to apply for the bank loan and structure were completed with help from Martin.

Their strategy to build wealth with property in a low tax environment had begun.

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About SuperBenefitnews

Self-Managed Superannuation Service Providers in Australia. SuperBenefit provides a wholistic SMSF assistance, education and administration service continuum - 1. “assistance” is help of whatsoever nature where our overall SMSF experience and knowledge enables us to provide assistance/help without any legal (or “license”) limitations. 2. “education” involves providing knowledge through teaching, coaching and mentoring about all matters SMSF, including (but not limited to) investment issues such as equities and property, 3. “administration” encompasses all admin aspects of legally required SMSF trustee and member record keeping including (but not limited to) audit and ATO matters. In keeping with our key point that SuperBenefit does not provide Financial Advice, where issues arise from 1, 2, and/or 3 above Indicate a need for a legally authorized provider (such as a Financial Adviser) and the client does not have their own service provider, the client can utilize SuperBenefit’s ‘Connect Assist’ … SuperBenefit, in itself, does not provide Financial Advice, but it does provide the wherewithal for great SMSF service. WE do not provide Financial Advice or any other service that requires a legally authorized provider. However, where such advice or service is required we have our ‘Connect Assist’, a SuperBenefit resource we use to connect clients to a Licensed Advisor or other legally authorised service provider. Call us 0407 361 596, no obligation FREE Connection call to see how we can help you!
This entry was posted in 2 Past Newsletter Topics, Case Studies of Clients, Superannuation General and tagged , , , . Bookmark the permalink.

2 Responses to CASE STUDY – Recently Re-married, Jan and Bill Pooled Super Into SMSF To Begin Property Investment

  1. Reblogged this on Australian Advisory Service and commented:
    Very interesting case study!


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