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Oct 02, 2023

S66 Acquisition of rest of 50% interest in Resi Prop

in SMSF Technical Forum

Fund already owns 50% of residential proeperty with related party owns rest.

Can super fund acquire rest of 50% from related party ?

No Unit Trust involved.

Fund owns direct 50 % share currently.

S66 states "The trustees must not acquire any assets (not listed as an exception) from any member or related party of the fund".

I wonder because fund already owns 50%, answer could be different ?

Appreciate your help.

2 comments

Comments (2)

THE AUDITORS INSTITUTE

Oct 03, 2023

Hi SP

My view is the Fund cannot acquire the 50% share in residential property from a related party even though the Fund already owns 50% of the property. There is no exception to the Fund for already owning part of the property.

The Fund cannot acquire property from a related party other than business real property (BRP) under section 66 of SIS. I assume the residential property in your example does not meet the definition of being BRP.

Thanks

The Auditors Institute

Oct 03, 2023

Replying to

Yes it is not BRP.

Thank you very much for prompt response.

Much appreciated.