Superannuation investment in classic cars

[Bremith]

I’ve seen a few references over the years to people investing their super in classic cars. I’ve had a look around online and understand the severe limitations on use etc. Can anyone recommend a financial adviser specifically and properly familiar with the ins and outs of the issues? I’ve had a chat to a couple of people but didn’t feel they had a genuine understanding of the issues.

[Cairns888]

Mitchell,

I remember this being discussed in detail on a post about a year or so ago.

[timp]

Mitchell,

I don't propose to be an expert, but i had three cars in my SMSF. The guidelines I was given were very clear.
1. cars can not reside at your residence
2. cars can not be driven except for repairs
3. cars can go to car shows, however it is grey on whether they are able to driven. The general consensus is no, they would have to trailered.
4. Auditors of the fund prefer them to be registered so there is a title. (I fell into trouble on this one)
5. The cars must be insured.
6. Any work must be carried out by a third party. You can not restore one yourself.

Thats pretty much it. Its akin to having a piece of art in your SMSF, it cant be in your house for you to appreciate and benefit from.

[9er]

I think , not allowed to be stored with a relative.

[Bremith]

Thanks Tim, that reflects my understanding. . In my case my SMSF wd be buying my S off me. I assume that’s what you did too? Couple of people I spoke to got nervous at that point, altho my understanding is it’s not a problem as long as paying a realistic market value confirmed by 3rd party. I was hoping to find an adviser who advised around this as core business.

[Cairns888]

I was told that you cannot purchase the car from yourself. So that threw a bucket of water on my SMSF chapter. Rego (club), insurance, storage and annual maintenance would be up there in expenses.
All that aside I couldn’t see a nice car hardly driven.

[Terminator]

I was told that you cannot purchase the car from yourself. So that threw a bucket of water on my SMSF chapter. Rego (club), insurance, storage and annual maintenance would be up there in expenses.
All that aside I couldn'’t see a nice car hardly driven.

Never driven by you, no matter what the circumstances, others can drive it to service and give a run but you cannot.

Yes unable to work on them yourself.

[SM911]

So in other words find a great mate, and get his SMSF to buy the car that you like, your SMSF buys the car that he likes, and voila - problem solved - drive each others cars. If only it were that simple.

[ELSPORTO]

Wonder why your SMSF can't buy your car?

[griffiths_r]

presumably have to be pretty comfortable that the investment in your p-car is going to be a good one over the long term compared to cash, property, shares and so on...

strikes me that at the technological pace we're running at, our cars could well be seen as the environmental devil by the time i hit retirement... which may impact on how much the smsf can sell it for to fund my nursing home bed.

[ELSPORTO]

Yeah very good point .... I keep thinking I'll pass my car on to my kids when I am too old to manage it, but reality is in 40 years time we'll be unable to road registered or drive these cars ... probably more like in 20 years time.

[e72phil]

Sell up now and buy BitCoins !

[reedminor]

Or drive it and enjoy it

[BrettD]

Alas gents, it's not that simple. The SMSF rules around 'collectables' changed a few years ago and most had to be removed (sold) out of the fund by June last year. 'In house' assets are limited to 5% of the fund value so you would need a pretty healthy balance.

[Terminator]

Alas gents, it's not that simple. The SMSF rules around 'collectables' changed a few years ago and most had to be removed (sold) out of the fund by June last year. 'In house' assets are limited to 5% of the fund value so you would need a pretty healthy balance.

If that is the case then one of the biggest Accounting Auditors in Vic has a real problem as they have no issue with the few cars I have in Super.!!!

Cars held before Jul1 2011 had until June 30, 2016 to comply with the new rules but providng you follow the rules it is OK

I think some record of buying and selling for a gain helps your case to meet the solely for retirement benefits clause