Don’t Miss the Boat! Transfer Your Commercial Property into Super Now

Commercial property investing and your super…

Between 10 May 2006 and 30 June 2007 there is a very narrow window of opportunity to deposit up to $1 million dollars into your super fund. What people may not be aware of is the fact that anyone can jump on this bandwagon—regardless of age. After that, people under 50 years of age are limited to $50,000, while people over 50 can put up to $150,000 a year (or $450,000 every three years) into superannuation.

If you’ve got plans for a very comfortable and prosperous retirement, you had better not miss the boat. Act now and you can take full advantage of this once-in-a-lifetime opportunity.

To make it easier for you the ATO has a concept termed “In-specie contributions”. Literally, it means the transfer of like to like. So it doesn’t have to be dollars. You can transfer commercial property or shares.

One example of somebody who is going to take advantage of this small window of opportunity is a medical practitioner who is planning to move his surgery (which he owns) into his superannuation fund. So if you own a shop, warehouse or office, you could likewise drop them into your super. And more good news—you can be the tenant, provided you pay a commercial rent.

Here’s what the ATO says about In-Specie Contributions:

Generally, trustees of Self-Managed Superannuation Funds (SMSFs) are prohibited from acquiring assets from related parties—such as fund members, their family and partners, related companies and trusts. However, there are some exceptions.

Therefore, if you’re a member of a SMSF you should not contribute your own assets or assets of your associates unless the asset is:


  • Business real property (used exclusively for the running of a business). For example, a warehouse you conduct your business from
  • A listed security (such as shares in companies listed on the stock exchange), or
  • An in-house asset. For example, an investment in a related party. The market value of in-house assets cannot exceed 5% of the total market value of assets held by the fund.



A lot of people who are excited about the opportunity to put up to $1 million into their superfund think they would like to put their residential investment property into their super fund, but, unfortunately, this is not allowed.

Just because you can transfer a commercial property into your superannuation fund does not mean that you might not be caught for capital gains. Any transfer between one owner and another creates a capital gains event.

The medical practitioner mentioned before has to have his surgery valued by a licensed valuer to ascertain the market value of the property prior to the transfer. When the property is transferred from himself to his Self Managed Super Fund, it triggers a capital gain. Fortunately for our medical practitioner, he is a sole trader and the capital gain in his name is reduced by the deduction of the contribution to superannuation.

I cannot stress enough the need to check out your particular situation with a taxation expert and financial advisor before rushing to sell off investment properties or to make an in specie transfer. You need to be fully aware of the capital gains implications and whether in your specific situation you can claim a deduction for the contribution of money or property to your super fund. You would not want to sell your property and then face a big tax bill for capital gains while only being able to claim a small deduction for the transfer of the property or money to your super fund.

However, that said, the situation merits your full attention now. If the real possibility of making a tax-smart move of your assets into your super exists, then you owe yourself the benefit of checking it out. It could be one of the most financially lucrative moves you have ever made, because your savings on income tax could go on for years on end.

For more information about commercial property investment and your super, contact Easy Tax today.


Take advantage of our small business accounting services during which we will help you to refine your needs and consider an accounting and tax planning solution for your business going forward… make an online enquiry today or call us on +61 2 9419 5322 and let us help you solve your accounting or tax problems.

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