THE AUDITORS INSTITUTE | FORUM

Archived Forums

When you become a member of The Auditors Institute, you immediately gain access to expertise, advocacy for your profession and peace of mind.

Ask a question in our members-only forum or use the search function to find prior technical discussions on your topic. You can expect a response within 24-48hrs.

Want to become a Member?

Join Now

Already a Member?

Disclaimer

The forum is made available by The Auditors Institute Ltd for the benefit of it’s members only, and its primary purpose is to facilitate education, training, and discussion between members. The information and answers provided within the forum are of a general nature and do not consider any specific circumstances, objectives, financial situation or needs related to the matter/s raised. The responses should not be construed as financial advice, and each Member should seek their own professional advice before making any decisions. The Auditors Institute Ltd and its representatives are not responsible for any actions taken based on the information provided in the forum.

To test this feature, visit your live site.

Phuong Hoang Thi Ngo

Jun 16, 2023

Issue more units under Fix Unit Trust

in SMSF Technical Forum

Dear Sir/Madam,

SMSF current holding 33% Units of total fix unit Trust (Eg 200 units) and Mrs personal member of SMSF holding 67% Units of total fix unit Trust (Eg 400 units)

If after unit trust add one more property that Mr trustee of unit trust current owner this property, can this fix unit trust issue more units for Mrs personal member and new units to Mr trustee of unit trust with units equal value of new property (Eg 700 units)?

For SMSF still the same holding 200 units so that now SMSF holding down to 15% of total units trust . I am not sure the law whether alow a Fix Unit Trust do as above. Please guide me whether any thing issue for audit this SMSF .

Many thanks

4 comments

Comments (4)

THE AUDITORS INSTITUTE

Jun 16, 2023

Hi Phoung

A SMSF cannot invest in a related unit trust (refer SIS Reg 13.22C) where the trust has acquired non business real property (eg residential property not used in a business) from a related party.

A SMSF can only invest in such a Trust if the SIS regulation 13.22C rules are complied with.

I would need more details to be able to respond to your query.

Thanks

SMSF AAA

Phuong Hoang Thi Ngo

Jun 16, 2023

Replying to

Dear Sir/Madam,

the property under unit trust is business real property

THE AUDITORS INSTITUTE

Jun 16, 2023

Replying to

Hi Phuong

Thanks, a related or unrelated party would be able to purchase extra or new units in the trust and the Super Fund % ownership decreasing as a result. The extra units would have to be issued / purchased at market value and for the Fund to continue its investment the rules in SIS Regulation 13.22C would need to continue to be complied with.

Thanks

SMSF AAA

Phuong Hoang Thi Ngo

Jun 16, 2023

Replying to

Thanks a lot for help