I beleive I know the answer but could an SMSF buy a real estate rent roll and lease it to the real estate trading entitiy ?
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Hi Robert
Yes a SMSF could purchase a rent roll from an unrelated party and then lease it to an unrelated party.
I have not come across such a purchase previously. The trustees would need to ensure it complies with the Fund's investment strategy and meets the SIS rules such as the sole purpose test, financial assistance to members and the in-house asset rules.
If the rent roll was leased to a related party it would be an in-house asset and the Fund would be restricted to it being less than 5% of its assets.
Thanks
SMSF AAA