Self-Managed Super Funds

Investment decisions and rules

A current benefit cannot be provided to a member or a related party from any of the assets held. 

Example 1

There is no rule that says an SMSF cannot run a business but the business would need to be operated for the sole purpose of providing retirement benefits for fund members. The ATO is likely to be very wary if the business is set up to employ members and/or other family members. The ATO may decide that the primary purpose is not to accumulate retirement savings but rather is to provide a current income stream to members or related parties. This could breach the sole purpose test.

Example 2

The SMSF cannot purchase a car for the member to use. This is an asset to benefit the member and would breach the sole purpose test.