Self-Managed Super Funds

Investment decisions and rules

Business real property

For many business owners the ability to acquire direct business real property is an attraction of an SMSF. Generally, an SMSF is unable to acquire an asset from a member or related party of the fund, but one of the main exceptions is for business real property. 

Business real property is land or buildings used wholly and exclusively in one of more businesses (whether carried on by a member of the SMSF or not). 

Transferring business real property into an SMSF may be attractive for the following purposes: 

  • To release capital back into the business or to the members directly (by selling the asset to the SMSF depending on ownership).
  • To provide tax concessions on the future investment earnings (rental income and assessable capital gains taxed at 15% in accumulation stage and zero in pension phase).
  • To offer some bankruptcy protection. 
  • Assets of a SMSF sold during the pension phase is exempt from CGT.