We incurred a loss on a property investment within our smsf and would like to ask if it was possible to transfer the loss into a new smsf or our personal tax?

Hi Stephanie,

The short answer is no. If you wind up a SMSF and there is capital losses, they will be lost.

The longer answer would be: Can you retain the existing SMSF, rather than starting a new one? You would be able to retain that entity and transfer the administration of that existing fund, to a new accountant/SMSF administration service if the goal was to just move away from the existing SMSF service. Or bring in other members to that fund, who might be able to use those losses.

The other question would be, is carrying forward the losses going to provide any great value? I typically recommend for my clients a thing called Investor Directed Portfolio Services (IDPS) or 'wrap' accounts for their superannuation. These superannuation funds can hold assets and not realise any Capital Gains and when the client reaches an age in which they can start a pension, can transfer the assets from accumulation to pension phase, without inuring CGT, then once in the pension phase, there is no tax payable. If you are 40, there's a fair chance you might realise some capital gains in the future before reaching pension age, but for those clients 50+, it's very reasonable to think that they will be able to get away without paying any CGT.

I hope that helps.

Cheers

Glenn

Hi Stephanie,
Glenn is spot on: the losses are stuck in the existing fund and you cannot transfer tax losses.

I think you probably have a whole lot of stuff going on in the background that you need to consider: for example, why are you talking about setting up a new fund?? It might be that there are other members of the existing fund and you want to separate your affairs from those people....

in any event it seems that you need to get specific advice that cant be had via an online forum like this: best thing you can do is find a GOOD QUALIFIED and EXPERIENCED local CPA or CA to help you out. Once you have sorted out your structure then you can make decisions about what you should be investing in....

good luck with this.
regards
Brendan

Yep

What they said is bang on ;)

AJ