All investments by your SMSF must be made on a commercial ‘arm’s length’ basis. The purchase and sale price of fund assets should always reflect true market value, and the income from fund assets should always reflect a true market rate of return.
Generally:
- you can't buy assets from, or lend money to, fund members or other related parties (there are some exceptions to this rule)
- your fund can't borrow money.
If you don't comply with the investment restrictions we may impose significant penalties, including disqualifying you as a trustee and even prosecution. It's a good idea to speak to an SMSF professional to make sure your investments comply with the law.
Find out about:
- Related parties and relatives
- Loans and early access
- Acquiring assets from related parties
- In-house assets
- Business real property
- Collectables and personal use assets
- Borrowing