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SMSF trustees unprepared for new collectible rules

SMSF trustees are broadly unprepared for the impending changes to collectible assets held within SMSFs which include collectible items such as stamps, paintings and vintage cars.

 

The new rules come into effect from July next year.

Speaking to Nest Egg’s sister title SMSF Adviser, AMP SMSF’s administration head of technical services Phil La Greca said while requirements for collectible assets around insurance, storage and valuations are already in place for collectibles acquired from July 2011, collectible assets acquired prior to this will also need to comply from July next year.

“I think [trustees] are putting it off; whenever there’s a deadline, people put it off to the last minute in the hope that the deadline gets changed or moved,” said Mr La Greca.

“There have always been issues; even now the rules have been in place since 2011, [but] you still see articles coming out saying they need to reverse the rules because they’re hurting the art industry.”

Mr La Greca said those holding grandfathered collectibles in their SMSF will need to “start seriously thinking over the next 18 months whether or not they can actually comply with the new rules”.

“[Trustees] haven’t got long; they need to find an insurer, somewhere to store it that complies with the rules and what it is going to cost.”

Mr La Greca said SMSF trustees need to be aware that if the collectible asset isn’t generating any income, then the other assets in the SMSF will have to pay for the costs associated with keeping it in the SMSF. 

“It’s all well and good to say, "Well the asset doubled in value in three years because it’s a $10,000 asset that doubles to $20,000" but if I spend $5,000 a year storing it and insuring it, then I haven’t made any money have I?” he said.

SMSF trustees unprepared for new collectible rules
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Anonymous - Why does this get all the media attention when in reality it affects very few and the charges are minimal? How about reporting on all the ISA TPD.......
Anonymous - This got to be the smartest comment this century ?!....
nan - So what do you do if you are being ripped of and then can't afford the body corporate fees....
MarkL - The banks may not charge dead people any more ........... but they won't charge them any less either!....