The ATO’s inaugural bulletin, about SMSFs and property development, is now available.
“Our aim is to share our concerns early to help you make informed decisions about your SMSF. The bulletin outlines a number of common mistakes that can arise in some arrangements and what trustees should do where contraventions or regulatory concerns are identified,” said the ATO in a statement.
The Tax Office revealed that an increasing number of SMSFs are entering arrangements to purchase and develop real property for subsequent disposal or leasing.
“In particular, we’re seeing a number of arrangements in which the investment activity is undertaken using joint venture arrangements, partnerships or investments through an ungeared related unit trust or company,” the ATO said.
“If you’re considering developing property within your SMSF or investing in a related property development entity or venture, we strongly encourage you to seek independent professional advice. In some cases, you may also wish to approach us for advice before doing so.”
The ATO publishes regulator bulletins on its database, to which advisers and trustees can subscribe.
