Property in SMSFs watched closely, but no review of limited recourse borrowing
The federal government is keeping a close watch on property acquisitions through self-managed superannuation, although a separate review of limited recourse borrowing arrangements that the financial services industry had expected will not go ahead.
Assistant Treasurer Arthur Sinodinos told delegates at the Self-Managed Superannuation Professionals’ Association of Australia conference this week in Brisbane, that there would be no specific review into the limited recourse borrowing arrangements which SMSFs use when taking out a loan to buy property.
Instead, these arrangements will be considered as part of a broader review into the financial services sector.
Sinodinos said the government was monitoring issues such as property spruikers promoting real estate through SMSFs to investors but did not want to introduce “heavy-handed regulation” to deal with any problems.
“We want to make sure that everybody understands that with people who provide you with advice, including on property, they have to be appropriately licensed and appropriately accredited so that the client is getting the best possible advice in their interest,” he said.
“Where possible, it’s about light-touch regulation and we like that sort of regime.”
He added that the government expected investors with SMSFs to take responsibility for their own investments and not expect to receive compensation if investments they made went bad.
