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Superannuation Gearing Bare Trusts

Superannuation Gearing Bare Trusts. Paul Trainor Level 1, 224 Rokeby Road Subiaco WA 6008 Tel: (08) 9380 4800 www.trainorlegal.biz. Super Gearing Bare Trust Flow Diagram .

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Superannuation Gearing Bare Trusts

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  1. Superannuation Gearing Bare Trusts Paul Trainor Level 1, 224 Rokeby Road Subiaco WA 6008 Tel: (08) 9380 4800 www.trainorlegal.biz

  2. Super Gearing Bare Trust Flow Diagram “Purchaser” of property (must set out all 4 names on the Offer and Acceptance). Passively holds the property for the Super Fund ## ACN (##) Directors: Bare Trust: ATF Bare Trust Name: ATF Super Trustee: ATF Super Fund Name: ## Trust Named to prevent confusion Borrower from Bank or related party lender, pays over the money at settlement to the Vendor. ## Pty Ltd Beneficial Owner ## Superannuation Fund

  3. Notes: • Super Fund Trustee agrees to enter into the Limited Recourse borrowing transaction and to using SGBT to hold the Property on Trust for the Super Fund. • Super Fund accounts for the Property asset as being beneficially owned by the Super Fund. • Super Fund makes one or more payments pursuant to the Loan Agreement and then directs the SGBT to transfer the Property into the Super Fund. • One property per bare trust. • Trustee company cannot perform any other function eg not trustee of any other trust (unless that trust is a bare trust holding another Property for the same Super Fund).

  4. Takeaways • educate your clients in advance • create the structure in advance (if possible) • early dialogue with the bank is critical • don’t assume related party loan is easier/cheaper • offer and acceptance wording is critical • subject to finance minimum 42 days (if possible) • bumpy landing/some degree of client frustration inevitable • SMSF gearing window may not be open forever

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