Bare Trust

A Bare Trust is set up only if you need to take out a loan (from a bank, a private lender, or any other source). The bare trust cannot be set up until you’ve identified the property the SMSF intends to purchase.

When you’ve identified  the property and supplied us with the relevant details, we can set up your bare trust in a matter of hours. Simply copy the following Bare Trust Information section, paste it into an email, enter the required information, and send it to us.

 

Bare Trust information

Property details:

Address:

LotNumber:

County

Parish

Title Reference

Plan Reference

 

Bank Details:

What is the lender company’s name and ACN?

Who is the lender?

Lender Company Name and ACN

What is the Lender company’s address?

 

Loan Information:

Total purchase price, loan amount, term of the loan in years, settlement date

 

Please email this data to us at:

admin@superannuationwarehouse.com.au

FAQ:

What is the Bare Trust for and what does it consist of?

The Bare Trust is used when the SMSF wants to borrow funds from a third party for investment purposes. The Bare Trust consists of a Corporate Trustee, a Custodian Trust and a Bare Trust.

If the SMSF wants to set up a Bare Trust structure, how much does it cost to set up?

The Bare Trust structure consists of 3 separate entities and each entity costs $950 to set up. The potential cost is $2,850 consisting of the following:

  • Corporate Trustee – $950.
  • Custodian Trust – $950
  • Bare Trust – $950

If you already have the Corporate Trustee set up, we can help you to set up the other 2 entities.

Should the Bare Trust Deed be signed before entering into the contract of purchase?

There are different state-based requirements about whether to sign the Bare Trust Deed before or after entering into the contract of purchase.

For NSW, TAS and ACT, the purchase contract must be signed and dated before the Bare Trust Deed.

For SA,QLD and NT, the Bare Trust Deed must be signed and dated before the purchase contract.

For VIC and WA, the Trustee can sign the purchase contract and the Bare Trust Deed in any order.

  • Jaime Aguirre

    I have been advised by the bank solicitors that the declaration of trust can attract full ad valorem
    transfer duty on the value of the property.

    Please let me know if this could be the case with my declaration of trust.

    Please see an example
    on this link:

    http://www.corrs.com.au/publications/corrs-in-brief/small-drafting-mistake-big-stamp-duty-cost/#ft1

    • superannuationwarehouse

      Jamie – answered.

      Thanks

      Regards Hein Preller Director – Superannuation Warehouse 03 86106999 (Office) 04 11241215 (Mobile) smsfwarehouse.com.au

    • Hein Preller

      State/Territory Revenue office contact details

      Victoria State Revenue Office
      GPO Box 4389 Melbourne VIC 3001
      Ph: 13 21 61
      http://www.sro.vic.gov.au

      Queensland Office of State Revenue
      GPO Box 2593 Brisbane QLD 4001
      Ph: 1300 300 734
      http://www.osr.qld.gov.au

      New South Wales Office of State Revenue
      GPO Box 4042 Sydney NSW 2001
      Ph: (02) 9689 6200
      http://www.osr.nsw.gov.au

      Tasmania State Revenue Office
      Ph: 1800 001 388
      Must be self-assessed online: http://www.sro.tas.gov.au

      South Australia Revenue SA
      GPO Box 1353 Adelaide SA 5001
      Ph: (08) 8226 3750
      http://www.revenuesa.sa.gov.au

      Western Australia Office of State Revenue
      GPO Box T1600 Perth WA 6845
      Ph: (08) 9262 1100
      http://www.finance.wa.gov.au

      ACT Revenue Office
      GPO Box 293 Civic Square ACT 2608
      Ph: (02) 6207 0028
      http://www.revenue.act.gov.au

      Northern Territory
      Territory Revenue Management
      GPO Box 154 Darwin NT 0801
      Ph: 1300 305 353
      http://www.revenue.nt.gov.au

  • Hein Preller

    Jamie, the case you sent is not an SMSF, but a charitable Trust. There are
    some similarities, but not the same thing.
    For an SMSF, just leave the property in the Bare Trust. There are possible
    stamp duty implications if you were to transfer it to the SMSF once the loan is paid
    off. There’s uncertainty on this and different legal practitioners will give
    different answers.
    If there’s the possibility of a transfer to the SMSF, rather don’t pay off the loan but leave a token amount, say $1000, in the loan so the bare trust structure remain in place. This will prevent the transfer to the SMSF and possible extra stamp duty.
    Trust this answers your question.

    • Jaime Aguirre

      My Declaration of Trust includes a schedule, where the property being purchased is detailed. My question is: when taking this document to the OSR for stamping, will they charge me the full ad valorem (on the value of the property) stamp duty??

  • Karen

    Our bank wants a letter from a solicitor to say the “holding trust” has been set up according to the Superannuation Act etc. if you set up our bare trust, do you have a lawyer/solicitor that could sign this letter. We’ve had an offer accepted on a residential property and have our Trust Deed in place

    • superannuationwarehouse

      Karen,

      As an accountant that is RG146 compliant, I am appropriately qualified and can sign this off for you if we set up the Bare Trust.

      Happy to assist.

      Best regards
      Hein Preller

Contact Details


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Superannuation Warehouse is an accounting firm and do not provide financial advice. All information provided has been prepared without taking into account any of the Trustees’ objectives, financial situation or needs. Because of that, Trustees are advised to consider their own circumstances before engaging our services.

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