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Learn rules, costs, and steps for using super to invest in property responsibly, safely today.
Running your own super fund gives you control over asset selection and timing, but it also puts legal accountability on every member who acts as a trustee. Begin by listing objectives, retirement horizon, and appetite for paperwork. Estimate set-up, accounting, audit, and legal costs, and compare them with your balance. If responsibilities and numbers make sense, proceed. If not, consider alternatives that still deliver diversification, discipline, and retirement-focused outcomes. Learn how using super to invest in property can grow your future – visit the website today!
Select either individual trustees or a company as trustee. Individual trustees are cheaper to start, yet changes in membership can complicate property title updates. A corporate trustee usually simplifies ownership changes and loan documentation, though it costs more initially. Every member must be a trustee and each trustee a member, subject to limited exceptions. Record the choice in signed minutes, because banks, conveyancers, and auditors will rely on this decision.
Create the fund by executing a trust deed that authorises contributions, investments, and administration. Ensure it allows direct real property and limited recourse borrowing if you intend to use leverage. Execute the deed correctly under your state or territory rules, appoint trustees, and settle the trust with an initial contribution. Keep signed copies for all members. Treat the deed as your operating manual for admitting members, documenting resolutions, and interpreting powers in day-to-day decisions.
Register the fund as regulated, obtain the necessary tax identifiers, and open a dedicated bank account in the fund’s name. Use the fund name and identifiers on all contracts, invoices, and returns. Have each trustee read and sign the standard declaration within the required timeframe and store it with permanent records. Consistent set-up avoids errors when negotiating property contracts, arranging finance, and preparing the first annual return.
Request rollovers from existing super accounts and set up employer or personal contributions where eligible. Respect caps, age-based conditions, and timing rules. Make sure money lands in the fund bank account and is receipted, then allocate amounts to the correct member. Never mix personal money with fund money. If a payment is made in error, follow the return process where permitted. Reliable funding is essential before entering contracts or applying for a limited recourse loan.
Document a strategy covering risk, return, diversification, liquidity, and insurance. Explain the role property will play, how rental income and cash will cover expenses and taxes, and how diversification will be maintained. Include assumptions about vacancy, rates, and repairs. Review the strategy at least annually and whenever circumstances change. Keep minutes of each review and the reasons for adjustments. Lenders and auditors will request this document, so keep it specific and workable. Secure your financial future by buying a property with super – click to learn more!
Every investment must satisfy the sole purpose test: benefits are for retirement, not present use. Residential property cannot be lived in by members or related parties, and it generally cannot be bought from them. Business real property is treated differently and can be acquired from, or leased to, a related party at market terms. Ensure all transactions are at arm’s length. Keep independent valuations for purchases, sales, and financial statements, and document rental agreements and outgoings.
Buying outright keeps administration simpler and removes lender covenants. If borrowing is needed, it must be through a limited recourse borrowing arrangement with a separate holding trust taking legal title while the fund holds beneficial interest. The loan must be on commercial terms and relate to a single acquirable asset. Model interest rate rises, buffers, and liquidity so the fund can pay bills, tax, and any pensions without forced selling in a weak market.
For a borrowing, establish a custody trust with a separate trustee. Align the custody deed with the loan and purchase contract. Ideally the contract is signed in the name of the holding trustee; if not, arrange a proper novation before settlement to avoid extra duty or compliance issues. Keep the borrowing limited to repairs and maintenance; major improvements are generally not allowed until the loan is repaid or structured as a new acquirable asset under the rules.
Run a dedicated transaction account and consider a separate account for rent and property costs. Implement two-person approvals for payments and a calendar of due dates. File digital copies of leases, insurance policies, rates notices, strata levies, maintenance invoices, and lender statements. Reconcile monthly. Use minutes to approve property managers, rent reviews, insurance renewals, and significant repairs. Robust controls reduce audit queries and demonstrate an arm’s length approach to dealings.
Order building and pest reports, check planning overlays, and review strata records where relevant. Confirm title details, trustee names, and identifiers on the contract. If borrowing, secure lender sign-off before varying terms. Pay the deposit from the fund account or loan facility, not personal funds. At settlement, file titles, update the asset register, and minute the acquisition, insurance, and management arrangements. Schedule the first valuation and create a maintenance plan for the first year.
Leases should reflect market rent and standard commercial conditions, with enforceable outgoings. For business real property leased to a related entity, obtain independent support for the rent and collect on time. Avoid informal use by members or relatives. Keep inspection records and photos to verify commercial use. Address arrears promptly through normal procedures. Where conflicts exist, record them and clearly explain how decisions were made in the fund’s best financial interests.
Keep minutes, bank statements, contracts, valuations, depreciation schedules, loan documents, and correspondence for the required period. Appoint an independent auditor each year to review financial statements and compliance. Provide complete files early to avoid qualified opinions. Auditors focus on contribution caps, strategy alignment, related party transactions, loan terms, and asset valuations. Respond promptly to queries and document remedial steps. After the audit, lodge the annual return and pay any amounts due.
Property is lumpy, so plan how the fund will pay benefits, pensions, and tax. Maintain cash buffers using rent, contributions, or a term deposit ladder. Think ahead to later stages such as starting a pension, adding a member, or selling the asset. Set out exit options: sell to an unrelated buyer, transfer to another fund, or sell to a related party where permitted and at verified market value for business real property. Model capital gains, selling costs, and settlement timing.
Measure net rental yield after costs, loan amortisation, and tax. Compare results to your written strategy and to alternative assets. If assumptions change, update the strategy and minute the reasons. Review member insurance annually. Confirm service providers remain independent and competitively priced. Update the deed when rules change or new methods are required. Keep the sole purpose test front of mind: every action should advance retirement outcomes while preserving compliance.
Trustee choices have lasting consequences. Obtain licensed personal advice on suitability, tax, and lending when questions exceed your expertise. Engage specialists to draft deeds, set up custody trusts, and review contracts. Consider financial modelling to test buffers and worst-case scenarios. Use independent valuations to support accounts and related party dealings. Well-documented advice that is followed can prevent costly corrections and helps trustees meet obligations while making accountable, informed decisions.
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