Can I still transfer shares I own to my SMSF?


YES and now no rush!

In an unexpected move on 30 May 2013 the Government decided not to proceed with the proposed banning of off-market transfers of listed securities (shares, listed hybrids etc) by  people to their self managed super fund (SMSF). This means that shares can still be transferred between SMSFs and related parties off-market.

The Government had previously announced that off-market transfers of listed securities between SMSFs and related parties would be banned from 1 July 2013. It was announced as a measure to prevent people abusing the system even though there was little proof of any abuse being widespread. Hopefully, the fact that they went so lose to legislating such measures will serve as a warning to those who tinker at the margins of abusing the facility. I would expect the ATO to use the proposed new penalty regime to target a few clear cases of abuse to ensure that the message gets through loud and clear! 

The Government had also previously announced that from 1 July 2013, a qualified independent valuation would be required in situations where an SMSF was acquiring an unlisted asset from a related party, or selling an unlisted asset to a related party. So selling properties, units in unit trusts or private company shares to or from the fund would have been made very expensive.

So the following is now the “current position”

The proposed ban on SMSF off-market transfers of listed securities between the fund and a related party, which was due to take effect from 1 July 2013, will not go ahead.

The proposed new additional requirement to obtain an independent valuation from a suitably qualified source when transacting with related parties and unlisted assets (e.g. certain types of property), which was due to come into effect from 1 July 2013, will not proceed.

SMSF Trustees can expect greater scrutiny of off market transactions by fund auditors as they meet their “breech” reporting obligations and take care not to attract the attention of the ATO in th first years of th new Auditor’s registration regime.

If you have concerns or want us to help you process transfers of shares to your fund just use the “schedule a meeting” option on the top left of this page or call our Castle Hill or Windsor Offices in the Norwest of Sydney for an appointment on 02 98941844 or 02 88536833.

The SMSF Coach

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2 Comments

  1. Mark

     /  August 9, 2013

    Thanks Liam. I would like to know the allowed time frame for transferring personal shares to my SMSF…can I look back for a week or month to see the lowest share price and then select that date? Cheers, Mark

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    Reply
    • Hi Mark

      It was because people were doing this and trying to find the “best” date to choose as the transfer date that the government were looking to close down this facility completely. So while the facility is still open and people are “choosing” the best outcome at the moment, you can expect that the ATO will revisit this issue and I expect guidelines later this year that will set specific limits to reduce this anomaly. You need to be sure that whatever you currently do will satisfy your auditor so I would check with them and urge you to stick to a recent date rather than risk a contravention report or draw the ire of the ATO.

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