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SMSF Borrowing Documentation
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Topdocs is amongst the most experienced providers of Superfund Borrowing documentation and support in the marketplace. We have provided SMSF Bare Trusts and related borrowing documentation to advisers and their clients since the ability for a Superfund to borrow was introduced in 2007.
Topdocs ensures your clients have every box checked when they enter into a SMSF Borrowing arrangement. Our team of specialists carefully go over each transaction, ensuring the documentation provided is compliant not only with the s67A legislation, but with the lending institution as well.
What documentation do I need to facilitate a Superfund Borrowing?
At the most basic level, you will need to have a Bare Trust prepared. The Bare Trust is the document that outlines the terms of the borrowing process, and is required by the Superfund’s auditor and the bank lender. Well drafted Bare Trusts deal with and mitigate the possible CGT and stamp duty issues associated with Superfund Borrowing.
Apart from the Bare Trust, you may also need the following documents prepared or updated:
- New SMSF Establishment or Deed update - The Deed for the Superfund must contain detailed borrowing provisions, and most pre-2007 deeds will need to be updated. These provisions are required by the auditor and the lender if the lender is a bank.
- SMSF or Bare Trust Trustee Company Registration - The trustee of the SMSF and the trustee of the Bare Trust cannot be the same legal entity. Many banks require the trustee of the SMSF and the trustee of the Bare Trust to be companies, however this is not a legal requirement. Request a Topdocs Lender Comparison Chart.
- SMSF Investment Strategy - The Superfund’s Investment Strategy may need to be updated to provide for the borrowing and the increase in holdings in property by the SMSF.
- Related Party Loan Agreement - if the lender is not a bank, the Fund will need a limited recourse loan agreement prepared.
Topdocs SMSF Bare Trust Documentation
Topdocs prepares both bank lender and related party lender Bare Trust documentation. For related party transactions, we provide a Limited Recourse Loan Agreement for your client to utilise.
Key features of our Bare Trust documentation include:
- We guarantee our documents will be accepted by every bank in the market place;
- Our Bare Trust has been refined to ensure it places your client in the best possible CGT and stamp duty position;
- Each Bare Trust is provided with individual legal signoff, stating the Bare Trust complies with the SIS legislation;
- We examine each SMSF borrowing transaction on its own merits, to identify any potential related party issues, or general borrowing restrictions.
Other required documentation:
Besides the required Bare Trust documentation, Topdocs also provides a complete suite of associated documents that your clients will need to facilitate a Superfund Borrowing, including:
- Limited Recourse Loan Agreements;
- SMSF Establishments and Superfund Trust Deed updates;
- SMSF Trustee Company registrations;
- Bare Trustee Company Registrations;
- SMSF Investment Strategies with clauses allowing for SMSF borrowing;
- Limited Statement of Advice - some lenders require this.
Superfund Borrowing FAQs
- Who are the parties to an SMSF Borrowing arrangement?
- Who can loan money to the Superfund?
- What type of Assets can an SMSF purchase via a Complying SMSF loan?
- What are the limitations in acquiring Real Property via a Complying SMSF Loan?
- Can capital improvements and associated expenses be included in a superfund borrowing arrangement?
- What are the limitations of acquiring listed securities, units and commodities via an SMSF borrowing arrangement?
- Can an Asset in a superfund borrowing arrangement be replaced with another asset?
- What is the procedure to commence an SMSF Loan?
- Who signs the contract of sale for the property?
- What about double stamp duty?
- What about CGT?
- What about personal guarantees?
- Can an SMSF limited recourse borrowing arrangement be refinanced?
- Which entity registers for GST?
- Can the Bare Trust have a bank account?