Non Listed Securities

so the next point is, does anyone know/have done making a unit trust a listed security? Is their a difference between listed and registered??

Ie surely you could transfer non listed (but registered) funds to your SMSF (these include managed fund units, unlisted proerty trusts units that are run by professionals?)

For registered is there any difference. I know for one there is no trustee only a responsibile entity (however duties are similar), and id imagine youd have to submit your accounts to ASIC and have them audited.

So basically im wondering how easy it would be to get around the above quote.

(**imagine if i sent all these questions to my accountant each week... id go broke, so thanks for all the help guys, much appreciated**)

 

Hi Dave,

As I understand it ... but I don't work in this area,

The SIS as far as I am aware does not give a definition of 'listed'.

Managed Investment Schemes are defined in the Corporations Act.

Unit trusts, partnerships and joint ventures are included in the definition. It does not matter whether they are 'listed' or 'unlisted'.

However, if they are not wholesale or widely marketed then they do not need to be 'registered'.

From this, I read that 'listed' is quite distinct from 'registered'

I believe that 'registered' means they are required to adopt a form given by the Corporations Act, i.e. a statutory form of trust subject to corporations regulation.

How does that sound ??

Cheers,

Rob

( I seem to be constantly criticising your creative ideas - sorry ! )

 

Definitions of Listed security on the Web:

a security which is bought and sold via an exchange, such as shares on the stock exchange.
BT Financial Group - Glossary

A security that is listed for trading on the stock exchange.
The Stock Exchange of Thailand - Acquire Investment Knowledge - Glossary

Securities that have been accepted for trading purposes by a recognized and regulated exchange.
news.firstdata.com/glossary.cfm

Thanks Google

Cheers,

Dan

 

I wouldnt of thought partnerships as i thought their would have to a legal structure, however good to know

Nope but they can be

This is the same opinion ive had from some of the clients ive worked on.

Sounds good, however i still have no idea if that means i can make my own unit trust registered and therefore be exempt from the in house asset rule if i want to transfer parts to super....

You starting to become like my partner, however atleast you have reasons for your answers (which i respect) instead of her normal "You have to be joking" or "Where to hell do you think of this crap..."

 

Dave

"Listed" means listed on the ASX (or similar securities exchange). Listing requires minimum unitholder spread, full dd review, pds to be prepared, payment of substantial listing fees, director requirements, ongoing continuous disclosure...don't even think about going there...

Cheers
N

 

Thanks Nigel

I find that quite extreme to prevent things like managed funds being transfered in but oh well...

Another creative attempt gone...

I wonder if an asset would be called inhouse if it was owned by a wife and the husband transfered it in, or it was owned by a DT and it was transfered in (surely this couldnt be in house and the individual has no control over a DT)...

Additionally is the new legislation about borrowing, might this relax the in house asset rule???

 

Hi Dave,

Assets acquired from a related party of the FUND.

I assume that means with respect to members, trustees, directors & shareholders of any corporate trustee.

It is quite severe. In Corporations and Taxation Law, related parties are just required to be dealing at arm's length.

Incidentally, now that in-specie contributions by your employer are exempt from FBT, does this mean they are also exempt from in-house assets ?? Can't see this but I haven't looked very hard.

There might be an opening for you at last Dave ??

Also, did you know that generally contributions by persons other than yourself, spouse, employer, or Government are taxed at the top rate ? (Thought I might save you a bit of time).

Cheers,

Rob

 

So if i have a SMSF for myself and dont include my wife (yes i know its greedy...) is it then potentially possible these transfers could be done then....

However i just want to state i have absoletly no plans of doing this (or the majority of my questions) in the immediate future. There usually all asked just to test other peoples thinking and try and create something a bit creative but legal...

But imagine the SMSF Audit fees if something like this did occur ... it will be alot more than the $200 you talked about in the other thread Rob...

 

I don't think you need to be in different funds to make a spouse contribution. However, I don't think a spouse contribution can be in specie.

Obviously a spouse of a member is a related party of the fund.

Also, there is a limit to what you can claim as a tax deduction for a spouse contribution, the spouse receiving the contribution is means tested to qualify for the deduction.

I am still unsure about whether in-specie contributions from your employer will fail the in-house assets test.

Even then, it still must not fail Part IVA to get a tax deduction for the employer !!

Its definitely not the sort of thing I would entertain myself so I can't get too excited. However, for people carrying on a business there are opportunities.

Cheers,

Rob

 

A strategy that I have seen put into place to get a unit trust into a SMSF without breaching SIS is to issue / sell units to other investors/superfunds so that there is no controller of the unit trust.

In this scenario there was a significant commercial property and all mortgages against the asset had to be discharged, with banks accepting security against unit holder's private assets during a 'window' period.

The reason for this was that a SMSF can only buy units in an un-geared unit trust. When a unit trust has no controller it cannot be related to the SMSF, therefore no breach of SIS. The largest % of ownership was approx 25%.

After the purchase of the units by the SMSF's was settled, the unit trust then refinanced against the original commercial property to release security from unit-holders private assets. It was a very complicated and expensive affair, but in the appropriate circumstances with the right professional guidance it could be appropriate.

Also, there was significant stamp duty & cgt issues. i am not providing advice but rather putting an idea out there for people to consider & take to their advisers if appropriate. !

Ta