Instalment Warrant Amendments: Implications for SMSF 'Develop and Hold' Strategies
Instalment warrants facilitated geared investments by SMSFs in real property, including development activities as part of a ‘develop and hold’ strategy. However, on 26 May 2010, the Superannuation Industry (Supervision) Amendment Bill 2010 (“Bill”) was introduced into parliament proposing to amend the Superannuation Industry (Supervision) Act 1993 (“SIS Act”) in order to reduce perceived prudential risks relating to the use of instalment warrant arrangements. In this paper, James Meli of Binetter Vale Lawyers argues that if passed in its current form, the Bill will have major implications for instalment warrant arrangements and geared self-managed superannuation fund (“SMSF”) investments in real property specifically.
