shares in smsf vs out of smsf, page-6

hi systems

you've got three ways to get the shares into the fund

1 - say the fund has spare cash of 100k - the fund can simply buy 100k in shares off you (supported by an off market transfer) - you incur cgt consequences personally and the fund hasn't changed value - ie it had 100k spare cash and now has new shares worth 100k; or

2 - you sell the shares personally and incur cgt consequences, then make a cash cont'n and then repurchase the shares on market - this is messy and means you're out of the market for a few days (can have a big diff if you were out of the market on LEI in the last week or so) - not to mention x2 lots of brokerage; or

3 - simply do an omt for the shares and transfer them in-specie for current value - and yep, you incur cgt consequences personally

the point i noted earlier was that in case 1 the fund hasn't changed value as there is simply no 'contribution' - however in 2 and 3 the fund has received contributions either cash or in-specie - the key point also is that you mentioned you're over 60 and in pension phase - accordingly, you may have the capacity to offset some of any crystallised gain by claiming part of the market value transferred (or cash) as a tax deduction to help offset the capital gain

hope that helps

cheers

mk