While one SMSF investment strategy has been closed off, another remains available for some business owners.
The federal government’s new rules prevent self-managed super funds from using borrowed funds to purchase residential investment properties.
Commercial property is different.
SMSFs can still use borrowing arrangements to acquire commercial property, including business premises, provided the relevant superannuation rules are met.
How it can work
- Purchasing business premises through an SMSF.
- Leasing the property back to the business.
- Building a retirement asset while giving the business greater certainty over its premises.
Like any long-term financial decision, there are trade-offs.
SMSF borrowing structures can be more complex than standard commercial loans, and the strategy won’t be appropriate for every business or every stage of growth.
That’s why it’s important to understand both the lending requirements and the long-term financial implications before proceeding.
Commercial property finance can vary significantly between lenders, particularly for SMSF borrowers. A broker can help explain the available funding options and compare lending structures before any decisions are made.
