5 Steps to Set Up SMSF for Property Investment

Your Guide from Strategy to Pre-Approval with Causbrooks Finance

With recent changes making SMSF lending more accessible, many business owners and investors are re-evaluating their superannuation as a pathway to property ownership. Whether you're eyeing a commercial property for your business or a residential investment to grow your retirement nest egg, using your SMSF to buy property can be a powerful strategy—if done correctly.

At Causbrooks Finance, we specialise in helping Australians navigate the complexities of SMSF lending. Here’s how we guide you through the five essential steps to get your fund—and your finances—ready to invest in property.

Step 1: Set Up the SMSF

The first step is to establish a compliant Self-Managed Super Fund (SMSF). An SMSF (Self-Managed Superannuation Fund) is a private super fund that you manage yourself. Unlike retail or industry super funds, where your retirement savings are managed by a fund provider, an SMSF gives you full control over how your super is invested.

Setting up an SMSF involves:

• Creating a trust structure with individual or corporate trustees
• Preparing a trust deed
• Registering the fund with the ATO
• Appointing members and trustees
• Setting up an investment strategy

We work with SMSF specialists and legal partners to ensure your fund is correctly structured from day one, aligning with your property goals and long-term retirement strategy. For more details visit the following website SMSF Setup Made Simple.

Step 2: Establish a Bare Trust (Holding Trust)

SMSFs that borrow to invest in property must use a structure known as a Limited Recourse Borrowing Arrangement (LRBA). This means setting up a bare trust—which is a separate trust that legally holds the property on behalf of the SMSF until the loan is repaid.

Our team of SMSF specialist accountants at our sister company causbrooks.com.au can ensure the trust structure is correctly implemented and that the property is legally and beneficially held in compliance with ATO and lender requirements.

Step 3: Rollover Superannuation Funds

Before your SMSF can make any investment, it needs funds. This means rolling over your superannuation from your existing retail or industry fund into your new SMSF bank account.

We assist with the rollover process, ensuring timing aligns with property settlement milestones and lender requirements, while maintaining compliance with contribution caps and preservation rules.

Step 4: Set Up the SMSF Bank Account

Your SMSF must have a dedicated bank account to receive rollovers, pay expenses, and manage rental income and loan repayments.

We help you choose and set up a compliant SMSF bank account, often with a lender that also supports SMSF property loans—saving you time and aligning your fund’s finances for a smoother loan process.

Step 5: Obtain Pre-Approval for SMSF Loan

Once your SMSF is funded and your structures are in place, it’s time to secure pre-approval for your property loan. SMSF lending criteria can be strict, and not all lenders offer these products.

At Causbrooks Finance, we have strong relationships with both major and non-bank lenders. We assess your fund’s position, recommend the right lender, and guide your application through to pre-approval—giving you confidence to search for property within your borrowing capacity.

Get Started with Causbrooks Finance

Setting up an SMSF to invest in property involves multiple steps, but with the right advice and lending partner, it’s a strategy that can unlock significant long-term benefits.

We help business owners and investors structure SMSF lending from end to end. If you’re considering using your super to buy property, now is the time to act.

Book your free consultation today and start your SMSF property journey with Causbrooks Finance

Managing Your SMSF After Property Purchase

Successfully setting up your SMSF and acquiring property is only the beginning. Effective ongoing management and compliance are critical to maintaining your SMSF's health and ensuring you avoid costly penalties or compliance breaches.

Annual Audit and Compliance Reporting

Every SMSF is required by law to undergo an annual audit by an independent, registered auditor. The purpose of this audit is to ensure your SMSF is compliant with superannuation laws, including correctly recording transactions, managing investments appropriately, and adhering to trustee responsibilities.

Your auditor will review financial statements, tax returns, and other essential compliance documents to confirm your fund’s adherence to ATO requirements.

Regular Financial Statements and Records

Proper record-keeping is crucial to demonstrate compliance and transparency. Your SMSF needs to prepare financial statements annually, which include details of your income, expenses, investment valuation, and loan repayments. Accurate records not only simplify your annual audit but also make it easier to manage your fund’s performance and plan for future investment decisions.

Tax Returns and Lodgement

An SMSF must lodge an annual tax return with the ATO. Because SMSFs enjoy concessional tax treatments, including potentially reduced rates on income and capital gains, accurate and timely tax lodgement is essential.

Late lodgement can result in penalties or loss of concessional tax benefits. Working closely with an SMSF tax accountant ensures that your returns are precise and submitted on time.

Maintaining Investment Compliance

SMSF trustees must regularly review and update the fund’s investment strategy, ensuring it remains suitable for the fund's circumstances and objectives.

Property investments should continuously align with your overall retirement goals, diversification strategy, liquidity requirements, and the sole purpose test, which mandates that all investments must aim solely to provide retirement benefits to members.

Professional Support for Ongoing Management

Given the complexities of SMSF compliance, most trustees benefit greatly from partnering with specialist professionals for ongoing fund management. Experienced SMSF advisors, accountants, and auditors provide ongoing guidance, ensure compliance with evolving regulatory requirements, and proactively identify potential issues before they become significant problems.

At Causbrooks Finance, our ongoing support doesn't stop at property settlement. Our sister company Chartered Accounting Firm Causbrooks can remain actively involved in helping trustees manage their SMSFs, maintain regulatory compliance, and optimise their funds for sustained long-term performance.

By proactively managing your SMSF after property purchase, you’ll be well-equipped to achieve your retirement and investment goals with confidence and clarity.