Can I access cash from super

Discussion in 'Accounting & Tax' started by Valentino, 29th May, 2019.

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  1. Valentino

    Valentino Well-Known Member

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    Hi, is it possible to withdraw cash from super to invest into property?
    Or to withdraw a lump sum of cash ?
    Ta
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    Have you died?
    Are you meeting another condition for release?
    Are you a FHB?
     
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  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Only if you have met a condition of release.
     
  4. Cate Bell

    Cate Bell Well-Known Member

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    Set up a SMSF, and yes, you can invest in property.
     
  5. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Thats a rather dangerous comment to anyone who read it. If a SMSF buys a property then "you" arent investing. The SMSF is a separate and distinct legal entity. Someone who asks about taking cash from super should NEVER consider a SMSF. Criminal and other penalties can be involved.

    The original post was about using cash from super to buy a property. That gives two pathways>

    1. A super fund buy property. It can borrow to do this or use its cash but there are major limitations about what it can buy, who it buys from , gearing and a whole host of complex financial matters. A SMSF is a financial product and requires licensed financial advice. And tax and legal advice.
    2. A member cannot withdraw proceeds from super except if a condition of release in met. Hardship provisions would not be met for the intended purchase of even a home for a homeless person. Certainly not for a rental.
     
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  6. spludgey

    spludgey Well-Known Member

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    Yep, I know someone that set up a SMSF and blew all the money. Didn't end well for him!
     
  7. Cate Bell

    Cate Bell Well-Known Member

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    I think your reading it all wrong. He is asking about how to invest, and yes you can invest if you have a SMSF- of course it is a distinct entity, but not everyone has the same level of knowledge as you seem to have. Perhaps you should share your vast knowledge of SMSFs? Not a dangerous comment at all, plenty of people, myself included have a compliant SMSF to invest in property.
     
  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    I think poorly worded phrases cause confusion, especially with other legal and tax entities.

    'you' is often mistakenly used when 'the trustee' should be used.
    you cannot invest your SMSFs money. You can cause the SMSF trustee to invest though.
     
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  9. PandS

    PandS Well-Known Member

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    ABC has story on super, people think properties will delivery them the quick path to wealth, setup SMSF and oppsy bad move.
    they don't now what is involves, and losing money and has to sell at a loss.
     
  10. PandS

    PandS Well-Known Member

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    I say leave it alone if you ask this question, you will regret touching it
     
  11. Cate Bell

    Cate Bell Well-Known Member

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    And that is where an accountant and your legal representatives will guide and educate you.
     
  12. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    If a person establishes a SMSF and doesnt understand the basic legal differences I argue they arent suited to use a SMSF. One of the best sources of knowedge is the ATO. Another is I Love SMSF Both are free sources of general knowledge. Buying a copy of Grant Abbotts Guru's Guide to SMSFs is well worth it too before making any decisions

    One of the first basis test is we check is -

    Q : Do you understand the differences between a corporate trustee and human trustee/s ?
    A : If they cannot explain this they may lack knowledge to consider a SMSF. They should not and can not rely on a third party adviser. An adviser can only guide them. Its a bit like expecting a toddler to be trained to sprint when they havent learned to walk.
     
  13. Cate Bell

    Cate Bell Well-Known Member

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    Interesting. Have you ever heard of the Household, Income and Labour Dynamics in Australia (HILDA) survey? It is very revealing, more than half of the country has poor financial literacy. Many people don't work in the legal/accounting/financing sector, and many don't learn financial literacy at home or at school. This is where a good financial advisor, accountants and legal representatives can play a role in education. I pay for good advice, and it was my accountant that recommended an SMSF, I knew nothing about them at the time. Not everyone has the knowledge or knows where to find information.
     
  14. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    All the more reason to use correct language when talking about things like super and trusts.
     
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  15. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    All matter a adviser should consider. Any adviser that preys on the illiterate is a concern too. This happened a lot with dodgy property advisers teaming up with less scrupulous advisers. ASIC seem to have run many out of town. I have seen many SMSF setup that should never have occurred. The stats of declining SMSF formations is a reflection on this I suspect.
     
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  16. Cate Bell

    Cate Bell Well-Known Member

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    And all the more reason not to totally dismiss a person who doesn't have the knowledge and has used "incorrect language". Of course there are those who have preyed on people who are financially illiterate, but that doesn't mean that people shouldn't have access to good advice and financial education. You both have made great assumptions about the OP based on language alone- you don't know anything about his financial position, risk appetite, strategies etc Would have been an interesting conversation, as you both seem like you have knowledge about SMSF to provide some information on how a SMSF can purchase property. For some people it is an excellent vehicle, but it isn't for everyone and like everything, there are risks involved.
     
  17. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    I am not sure what the issue is Cate. I was responding to your criticism of Paul, who i though made a good point. I wasn't commenting on the op. Your comments implied that an individual could use super to invest, you wrote "Set up a SMSF, and yes, you can invest in property"
     
  18. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Posting on a forum can be construed as general financial product advice and that also requires a Australian Financial Services License as much as personal product advice. Many people dont know this and could see a post as some form of educated guidance when it is factually flawed. I suspect thats why Terry said what he did. Its why I said what I said.
     
  19. Ace in the Hole

    Ace in the Hole Well-Known Member

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    I have to admit that I would fail this question, and many other similar financial questions, but settling on a 2m CIP next week using the SMSF, something to do with a bare trust.
    I leave all this stuff to my accountant and he has done some pretty good structuring for us up to this point based on what I can tell and results achieved.

    If you are using experienced professionals and trust them from a decade of working together, do you really need to know the how and why before proceeding?
     
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  20. Cate Bell

    Cate Bell Well-Known Member

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    My comment implied that it can be done and to seek further advice. Not everyone has the same level of financial experience/education, and that is why people seek professional advice. Gosh, why are you two so argumentative? If you can't comment due to whatever, then don't. Your comments aren't at all helpful.