Although the legislation has yet to be introduced into Parliament, the Australian Government’s intentions regarding off-market transactions are set out in the Stronger Super Information Pack, published on 21 September 2011 and are due to come into effect from 1 July 2012.

What are the new off-market transfer rules?

From 1 July 2012:

  • Where a market for an asset exists – all acquisitions and disposals between SMSF trustees and related parties must be conducted through the relevant market or exchange.
  • Where there is no underlying market – the transaction must be supported by a valuation obtained from a properly qualified independent valuer.

For example:

  • where a SMSF trustee is seeking to purchase shares in an ASX listed company, the trustee must purchase them from the market, such as through a broker.
  • where the acquisition or disposal involves property, a valuation will be required.

 

At present, listed securities can be purchased directly from a related party, without the need to engage a broker to give effect to the transfer.

After the reforms take effect, SMSF trustees will no longer be permitted to purchase listed securities directly from related parties of the fund. Rather, SMSF trustees will be required to acquire the securities from the relevant market or exchange.