Super Gearing Trust Deeds Different for Each State

The law that permits a superannuation fund to borrow requires that the property acquired using the borrowed funds be held on a simple trust for the super fund by a separate trustee.  Generally it is considered that there should be a trust document evidencing that trust.

The stamp duty laws in the different States have slightly different attitudes to the duty that would be payable when the loan is repaid and that trustee transfers the property to the trustee of the super fund.

It is important to ensure that the trust document used be in line with the local State’s stamp duty law and practice.  For example in NSW there are the ‘apparent purchaser’ provisions that would make it unwise to sign the deed before signing the contract to buy the property.  In Queensland however a different law applies and the trust deed should be signed before the purchase contract.

SUPERCentral’s associated law firm TOWNSENDS BUSINESS & CORPORATE LAWYERS has studied the stamp duty law and practice in each State and can help you understand your local State’s requirements and provide the necessary documentation you need if your SMSF wants to purchase a property using borrowed funds.  Contact TOWNSENDS BUSINESS & CORPORATE LAWYERS on (02) 8296 6222 or email info@townsendslaw.com.au .