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Buying property overseas inside an SMSF

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I have been toying with buying a parcel of land and building a house overseas. Can I do it inside a self-managed super fund? Do you think it is a good idea? Guido, Balmain, NSW.

You could do it inside an SMSF but you could not live in it when you go overseas to see it. It could be a good idea but you have to remember there are currency dangers of investing overseas and builder risk problems when you are not there to project manage the building. There can be local laws that involve taxes or charges that could render your investment less profitable and you would have agency fees to run the rental property and legal fees as well. I suggest you prepare a business plan for the idea for both inside and outside of an SMSF. Talk to a good accountant so you understand the tax implications and this should be in your business plan. By the way, there are a lot of properties in Europe at low prices now and so it could be a more economical to buy an existing property. You should do a business plan on this as an alternative.

Published on: Monday, June 17, 2013

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