SMSF Investing in collectables (wine, artwork & memorabilia)
What are collectables?
Collectables and personal use assets are things like:
When can SMSF invest in collectables?
Investments in such items must be made for genuine retirement purposes, not to provide any present-day benefit.
Collectables and personal use assets can’t be:
- leased to, or part of a lease arrangement with, a related party
- used by a related party
- stored or displayed in a private residence of a related party.
What other rules apply?
- your investment must comply with all other relevant investment restrictions, including the sole purpose test
- the decision on where the item is stored must be documented (for example, in the minutes of a meeting of trustees) and the written record kept COLLECTABLES MUST NOT BE STORED IN YOUR PRIVATE RESIDENCE OR OFFICE.
- the item must be insured in the fund’s name within seven days of the fund acquiring it
- if the item is transferred to a related party, this must be at market price as determined by a qualified, independent valuer.
- You can only lease collectables and personal use assets to an unrelated party and the lease must be on arm’s length terms.
- Collectables and personal use assets can be sold to a related party provided the sale is at market price as determined by a qualified, independent valuer.
For collectables and personal use assets you held before 1 July 2011 you had until 30 June 2016 to comply with these rules.