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Self Managed Super Fund (SMSF) Article
In clarity we trust

By Tony Negline.

This article may be out of date.

24th March 2010

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Finally a couple of weeks ago the Government announced plans to provide more certainty for Instalment Warrant investors including super funds.  Many of the plans seek to amend that Capital Gains Tax rules to remove some potential doubts about the precise application of some laws with these investment structures.

At present Instalment Warrants demand the use of a bare trust.  This structure is in place until the loan is repaid.  The use of the bare trust raises a number of issues from a tax perspective.

The Government are suggesting that for income tax and CGT purposes specific laws will be put into place which "look through" bare trust and the borrower will be deemed to be the owner.

On the face of it these are good suggestions but the proof will be final regulatory regime when it is put in place.  Hopefully the final rules will simplify the gearing structure super funds have to use.

Super gearing seems to be in the early stages of becoming very popular.  It's good the Government are seeking to provide certainty for this growing area of interest.

At this point in time it would seem safe to say that super gearing arrangements will not be banned in the near future.

Details about these proposals can be found at the Treasury website –

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