by Jason Ginns
Over the years, Lambourne Partners has assisted a range of clients in structuring the purchase and finance of their business premises in their Self-Managed Superannuation Fund (SMSF).
The benefits of this strategy include greater asset protection, lower income tax and Capital Gains Tax (CGT) rates, accessing CGT concessions, and paying off and growing an investment (as opposed to paying dead rent to a landlord).
Overcoming SMSF Regulatory & Borrowing Issues
When reviewing business premises options, utilising an SMSF is a strategy that business owners should consider, especially where you’ve been able to build up your superannuation balance to at least $250,000 (which can also include your spouse’s superannuation). However, like a lot of areas, Government regulation has made using this structure progressively harder for business owners and their advisors to achieve.
Over recent years all the major banks and most financial institutions have pulled out of lending to SMSFs, making it more difficult to obtain finance. On top of this, the increased compliance requirements placed on financial planners has limited the circumstances where they can provide this advice (and rightly so in a range of circumstances).
However, if your business advisor, financial planner, and finance broker/bank are all working together, this structure is still well within reach of most business owners.
Recent Client Examples with Related & Unrelated Members
Working together, the team at Lambourne Partners has recently assisted a client achieve in transferring their existing business premises that were owned personally into their SMSF.
Not only did this strategy achieve all the benefits mentioned above, including CGT concessions on the transfer of the property from their personal names into the SMSF, we were also able to structure the transfer to avoid any stamp duty on the purchase of the property by the SMSF (which can only occur in limited circumstances).
The strategies available in this area aren’t just limited to a single SMSF – if you’re in business with unrelated business associates, there are alternate and sometimes less stringent options that can assist you and your business associates pool your SMSF funds together to purchase your business premises. Only last month, Lambourne Partners helped a group of clients achieve this result with their new office premises.
How We Can Help
Commercial property like superannuation is a long-term investment, and an SMSF is not always the most appropriate structure to use, but it should at least be considered.
That’s where the team at Lambourne Partners can swing into action, with the advisors from Lambourne Partners, Lambourne Partners Wealth and Lambourne Partners Finance all working together to get you the most desirable result for your property investment.
If you’re considering purchasing premises for your business now or in the future, or this is one of your business or personal goals and you weren’t sure if or how you could achieve this, then contact Lambourne Partners below and we can work together to help you achieve this.