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New rules on collectables for SMSFs released
Self-managed superannuation funds have a little more clarity about investing in collectables and personal use assets with the release of draft regulations by Minister for Financial Services and Superannuation, Bill Shorten.
Shorten announced new rules, including the prohibition of leasing assets to related parties, the use of assets by related parties or the storage of collectables in the private residences of related parties.
There must also now be a written record of the reason for the storage of an item in a particular location, which must be kept for at least 10 years.
Items must also be insured in a fund’s name within a week of acquiring the item, while the transfer of assets to a related party now requires independent valuation.
The rules are set to commence on 1 July, 2011 for all new assets, with a transitionary period applying to existing assets in place until 1 July, 2016.
Shorten said the regulations will allow SMSF trustees to continue to invest in collectables in the wake of the Super System Review recommendation that these investments should be prohibited because of the risk investments, would be made for current-day benefits.
“The new rules will ensure that these investments are genuinely made for retirement income purposes and not for trustees’ personal enjoyment,” Shorten said.
Written submissions on the draft regulations close on 14 June, 2011.
AUTHOR
Ashleigh McIntyre
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