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Wayne Wanders

Business Advisor

The Wealth Navigator

https://thewealthnavigator.com.au/

Sydney, New South Wales

0412 227 052

Wayne Wanders, has a proven track record as a chartered accountant and business advisor for over 30 years.

In that time Wayne has worked with a large number of businesses including being the Chief Financial Officer (CFO) for two Australian businesses publicly listed on the Australian Stock Exchange (ASX).

Wayne has also worked with many small businesses as their Virtual CFO whilst they could not afford to employ a full time CFO.

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Q: I was reading in the Financial Review that I could potentially rent out my SMSF investment property to a family member as long as it is done at a commercial rate. I much prefer to rent to someone I know. Is this true?

A: Adam this is a very topical question because right now there is a case in the courts over a very similar issue. This involves a SMSF buying student accommodation and several years later a daughter rents a room at commercial rates. On first review by the courts this was considered not to be allowed under the sole purpose test. But on appeal this was over turned as at the time the decision to invest was made, the SMSF had no intention to let a room to the daughter. So a very interesting interpretation of the law, but, I do not know if the ATO are going to appeal the appeal and take it to a higher court yet. So there may be court precedent as to what constitutes the sole purpose test, but we will have to wait and see. Fundementally in my mind there is no difference renting a commercial property from your smsf (which is allowed) and renting a residential property from your smsf (which may now be allowed subject to the finalisation of the above case)