Repeat buyers are one of the strongest measures of confidence in any apartment development.

At <a href="https://www.apartments.com.au/new-apartments/era-newcastle-west-124-126-bull-street-newcastle-west-nsw-2302">ERA</a> in Newcastle West, some purchasers are returning to <a href="https://www.apartments.com.au/developers/gwh">GWH</a> after living at the developer's One Apartments. Their decision to purchase again was driven by the quality of life they found after moving into their first GWH home.

Keith Wilton had spent years living in a house in East Maitland before deciding it was time for a change. Apartment living had always been on his radar, but he was selective about what he wanted.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/FH_1EzB-1vs?si=XScVlP1ERsTDJoME" title="YouTube video player" width="560"></iframe>

"I had some boxes I wanted to tick," he says.

Keith points to the open-plan design, generous outdoor areas and considered inclusions as key reasons One Apartments worked for him.

“One of those things was a nice indoor open plan area, but also I wanted a nice outdoor open area that I could entertain on in summer or Christmases or birthdays,” he says.

He also found value in the smaller details, from integrated appliances to shared resident spaces including the pool, cinema and rooftop areas.

[smartcode_project:default project_id=135096 project_image_fid=356818]

After comparing several developments, he chose One Apartments because of GWH's longstanding local reputation and his own experience working with the developer on a commercial project more than a decade earlier.

"I knew that they were local, that the quality of the build was going to be up there. I'd looked at other apartment complexes around and close by, and I just knew that here was a better decision location wise."

Today, Keith says the move has completely changed how he experiences Newcastle.

"I enjoy living in this location because it's more of a lifestyle change. That Newcastle city living where you can walk to restaurants and bars and even beaches and parks and even shopping across the road."

[smartcode_project:default project_id=135096 project_image_fid=356828]

Beyond the location, he says it's the sense of community that has surprised him most.

"Everyone loves living here because they chose to live here, but everyone looks out for each other. It's a real great community feel here."

For Aimee and Lyle Goodman, the journey started almost by chance.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/tsioMLcnjas?si=zq-ys3JuWpfa5hFv" title="YouTube video player" width="560"></iframe>

The couple happened to be having coffee in Newcastle when they noticed the site where One Apartments was about to begin construction.

"We were aware GWH was planning a development," Aimee says. "We made one phone call and things moved pretty quickly after that."

As busy business owners, they initially thought apartment living would simply reduce the maintenance that came with larger homes. Instead, it fundamentally changed how they spent time together.

"We actually catch up more as a family now," Aimee says.

"We've had homes with big yards and lots of space, but everyone ended up in different rooms. Here we'll have dinner together, the kids can play, and we spend far more quality time together."

[smartcode_project:default project_id=135096 project_image_fid=356829]

Lyle says their confidence came from GWH's reputation within Newcastle's building industry.

"I know people who've worked across different apartment projects, and whenever GWH came up the feedback was always the same. They're rock solid. They're quality."

That confidence only grew throughout the buying process.

"One of the things that really impressed us with GWH was the whole process, was the communication," Lyle says. "It was consistent, it was regular, there was no problem if we had some weird questions, there was no problems in getting answers."

[smartcode_project:default project_id=135096 project_image_fid=351104]

Aimee says one moment stood out.

"The project actually finished on time. We realised we needed to hurry up and sell our house because everything was happening exactly when they said it would."

The positive experience at One Apartments ultimately gave all three buyers the confidence to purchase again with GWH, this time at ERA.

Their confidence reflects what many buyers are seeking in today's apartment market. Location remains important, but so too does certainty around delivery, quality and long-term liveability.

[smartcode_project:default project_id=135096 project_image_fid=356822]

ERA builds on those foundations with 280 one, two and three-bedroom apartments across two landmark towers in <a href="https://www.apartments.com.au/developments/newcastle-west-nsw-2302">Newcastle West</a>.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/fk-australia">Fender Katsalidis</a>, the project will include more than 2,000 square metres of resident amenities, including a resort-style pool, gym, sauna, private cinema and rooftop entertaining spaces overlooking the harbour and coastline.&nbsp;

The development is also within walking distance of the Newcastle Interchange, Honeysuckle, Darby Street, the harbour foreshore, restaurants, retail and the city’s beaches, continuing the walkable lifestyle that existing GWH buyers say has transformed how they live.

[smartcode_project:default project_id=135096 project_image_fid=356826]

For Keith, the appeal remains straightforward.

"You feel at home even before you've moved into your home."

For Aimee, the change is measured in time.

“I just felt like I had more time,” she says.

[smartcode_project:default project_id=135096 project_image_fid=351102]

Construction at ERA is now underway, with more than half of the residences already sold and limited two and three-bedroom apartments remaining in the East Tower release. Priced from $980,000 for two-bedroom residences and $1.46 million for three-bedroom residences, buyers can secure an apartment with a 10 per cent deposit, with premium homes offering ocean views from Level 8 and harbour views from Level 10.

ERA is also backed by Resilience Insurance's 10-year Latent Defects Insurance policy, providing protection against structural or waterproofing defects for 10 years after completion. The project is anticipated to be completed in early 2028.

[smartcode_project_cta:default project_id=135096]

Joel Robinson

From ONE to ERA: Why buyers are choosing GWH again in Newcastle West

Virgate Property Group is preparing to commence construction of Verdé, its new apartment development in Melbourne's Arts Precinct at Southbank, following a strong run of sales that has seen more than half of the project's 173 apartments secured.

Verdé has attracted a broad mix of first home buyers, owner-occupiers upgrading from nearby inner-city suburbs and investors, with younger owner-occupier couples aged between 28 and 45 accounting for the strongest enquiry. Many are already living in Southbank, South Melbourne, Albert Park, Port Melbourne, South Yarra and the CBD.

"Verdé is located in one of the most desirable pockets of southern Melbourne," Blair Property Group Director Darren Blair, who is managing sales at Verdé, said.

"It's within walking distance of the Arts Centre, Royal Botanic Gardens, Albert Park Lake, and Southbank's restaurants and retail. It's a great lifestyle location with strong amenity and liveability, which made it a very attractive choice for the project."

[smartcode_project:default project_id=4661 project_image_fid=372549]

Virgate was already familiar with the precinct, having previously delivered the successful Domain House development in neighbouring South Melbourne. That experience gave the developer confidence to acquire the Coventry Street site and continue expanding its presence in Melbourne's inner south.

"We had been keeping an eye on the site and the broader precinct for a few months before deciding to move forward with the acquisition," Virgate said.

The project was ultimately secured in 2020 following feasibility studies, planning assessments and due diligence, with the brief centred on delivering "a high-quality, considered design that feels both refined and fit for purpose."

[smartcode_project:default project_id=4661 project_image_fid=314259]

Designed by <a href="https://www.apartments.com.au/architects/bruce-henderson-architects">Bruce Henderson Architects</a>, Verdé comprises 173 one, two and three-bedroom apartments priced from $599,000. The architecture is distinguished by a faceted glass façade that responds to both the site's outlook and Melbourne's changing light conditions.

According to Bruce Henderson Architects, the coloured glazing gives the building a distinctive identity while also providing privacy and solar shading, with residences oriented to capture views across the bay, city skyline and surrounding parklands.

Inside, <a href="https://www.apartments.com.au/interior-designers/designoffice">DesignOffice</a> has created interiors focused on natural light, efficient planning and enduring materials. Apartments feature engineered oak flooring, natural stone benchtops, floor-to-ceiling glazing and SMEG appliances, while a restrained material palette aims to complement the expansive outlooks rather than compete with them.

[smartcode_project:default project_id=4661 project_image_fid=372550]

Resident amenity has also been designed around everyday functionality rather than occasional use. Facilities include a concierge-serviced lobby, residents' lounge with fireplace, library and co-working space, gym, terrace garden with barbecue facilities, ground-floor café, and package delivery management.

The project's location continues to be one of its strongest drawcards. Positioned on Coventry Street, Verdé sits within walking distance of the National Gallery of Victoria, Arts Centre Melbourne, Royal Botanic Gardens and Albert Park Lake, while Southbank's dining precinct, Sturt Street trams and the new ANZAC Station are all nearby. The surrounding education catchment also includes Melbourne Grammar, Melbourne Girls Grammar, Mac.Robertson Girls' High School and several major university campuses.

The sales team says buyers have responded particularly well to the combination of location, design quality and long-term liveability.

"They're responding really positively to the quality of the design, premium resident amenities and the uninterrupted views. Many also appreciate the location and how connected it is to everything they need."

The ability to secure stamp duty savings before completion has also been a key factor for purchasers, alongside the opportunity to personalise finishes ahead of settlement.

With construction set to commence soon and more than half the apartments already sold, Verdé enters its next phase as one of the Arts Precinct's more established apartment developments, offering remaining buyers an opportunity to secure a residence before construction advances further. Expected completion is scheduled for late 2027.

[smartcode_project_cta:default project_id=4661]

Virgate's Verdé Southbank moves toward construction as sales fly past halfway stage

Downsizer-focused apartment development Kooyongkoot in Hawthorn has been recognised at the 2026 Better Future Melbourne Design Awards, taking home Gold and Silver awards in two categories.

<a href="https://www.apartments.com.au/new-apartments/kooyongkoot-hawthorn-1-kooyongkoot-road-hawthorn-vic-3122">Kooyongkoot</a>, currently being delivered by developer PQD and designed by Cera Stribley, received Gold in the Interior Design – Proposed category and Silver in the Architecture – Proposed category.

The dual recognition reflects the design approach behind the boutique development on prestigious Kooyongkoot Road, where the focus has been on creating homes for downsizers seeking the space, quality and functionality of a detached house within a low-rise apartment building.

Rather than maximising apartment numbers, <a href="https://www.apartments.com.au/developers/pqd">PQD</a> and <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a> limited the development to just 18 residences, allowing for larger floorplans, greater privacy, generous landscaping and expansive communal spaces.&nbsp;The majority of the apartments also benefit from corner aspects, allowing for dual sources of natural light.

Now around 70 per cent complete and on track for completion in November 2026, Kooyongkoot will comprise a mix of garden residences, ter​race apartments, sub-penthouses, and is crowned by two half-floor penthouses with direct lift access and private rooftop terraces.

[smartcode_project:default project_id=102717 project_image_fid=355297]

The Silver Award for Architecture recognised the way the building responds to its prominent corner position at the ent​rance to Hawthorn's Scotch Hill precinct, one of Melbourne's most established residential neighbourhoods.

Rather than competing with the grand homes that line Kooyongkoot Road, the architectural approach focused on restraint and longevity, using curved brickwork, generous landscaping and carefully considered proportions to integrate with the existing streetscape.

"The form feels fluid and timeless, as though shaped by the landscape itself – architecture that belongs, rather than competes," said Chris Stribley, Co-Founder and Managing Principal of Cera Stribley.

The judging submission also highlighted practical innovations throughout the building, including lift cores servicing only nine homes each, a central landscaped lightcourt designed to bring daylight and ventilation into the building, and fully enclosed private storage rooms with lighting, power and shelving to better accommodate residents transitioning from larger family homes.

[smartcode_project:default project_id=102717 project_image_fid=355293]

The Gold Award for Interior Design recognised the project's focus on long-term liveability rather than display-home aesthetics.

According to the awards submission, the interiors were designed from the inside out, prioritising how homes would function over decades of daily use through generous proportions, practical storage, durable natural materials and flexible layouts.

The specification includes natural stone throughout, upgraded acoustic glazing, V-ZUG appliances and fully enclosed storage rooms, alongside an amenity offering focused on wellness, entertainment and everyday convenience.&nbsp;

Residents will have access to a gym and yoga studio, a wellness centre featuring traditional and infrared saunas, a cold therapy shower and treatment room, as well as a residents' lounge and golf simulator/cinema room for entertainment.&nbsp;Kooyongkoot has also considered the everyday convenience of its residents by offering a private carwash and pet wash facilities on site as well as dedicated parcel lockers and oversized fully enclosed storage rooms.&nbsp;

[smartcode_project:default project_id=102717 project_image_fid=355303]

The project's attention to detail has already resonated with buyers. Earlier this year, Kooyongkoot recorded one of Boroondara's highest apartment sales when an $8 million penthouse was purchased by a Melbourne CEO downsizing from a nearby family home.

"Every detail feels deliberate, from the overall design down to the smallest touches," the purchaser said.

"The level of quality and refinement is exceptional, but what really sold it was how liveable it felt... It felt like a place where everything had been considered, not just a luxury building."

[smartcode_project:default project_id=102717 project_image_fid=355304]

Sustainability also formed a key part of both award submissions. Kooyongkoot is targeting a minimum 7.5-star NatHERS rating across all residences, supported by passive design principles, high-performance glazing, EV charging infrastructure, water reuse systems and a wellness model focused on lower-energy dry facilities rather than pools and large wet areas.

Located within walking distance of Scotch College, Methodist Ladies' College, Koo​yong Lawn Tennis Club, Aubur​n Village and Camberwell Junction, Kooyongkoot continues to target owner-occupiers looking to remain in Melbourne's inner east without compromising on space or quality. A limited selection of two, three and four-bedroom residences remains available, with prices starting from $1.9 million.

[smartcode_project_cta:default project_id=102717]

Kooyongkoot wins Gold and Silver at Better Future Melbourne Design Awards

New apartment supply has become increasingly constrained across <a href="https://www.apartments.com.au/developments/parramatta-nsw-2150">Parramatta</a> in recent years, with fewer projects progressing through to completion as development conditions have become more challenging.

It makes <a href="https://www.apartments.com.au/developers/novm">NOVM</a>'s 2021-completed <a href="https://www.apartments.com.au/buildings/the-lennox-parramatta-12-phillip-street-parramatta-nsw-2150">The Lennox</a> one of the most recently completed residential towers on the Parramatta River, and among the newest apartment developments in Sydney's second CBD.

With the project largely completed before the sharp escalation in construction costs and inflation following the pandemic, The Lennox is now offering pricing that would be difficult to replicate in a comparable new development in Parramatta today, or across much of Western Sydney.

The majority of the 413 apartments at The Lennox sold before and shortly after completion. A limited release of the remaining apartments has recently been brought to market by capital partner <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a>, with entry-level pricing from $700,000 and two-bedroom apartments available from under $1 million.

Rising above the Parramatta River at 12 Phillip Street, The Lennox comprises one, two, three and four-bedroom apartments, appealing to first home buyers, young professionals, families, downsizers and interstate investors seeking a completed apartment in one of Australia's fastest-growing economic centres.

[smartcode_project:default project_id=5743 project_image_fid=372394]

Rather than positioning Parramatta as an alternative to Sydney's CBD, Equitifund believes the city has reached a point where it stands on its own merits.

"Parramatta is no longer simply an alternative to Sydney CBD, it's becoming a destination in its own right," Equitifund Executive Chairman Greg Huxley said.

"The Lennox captures that evolution with a level of quality and amenity that's difficult to match at its price point."

[smartcode_project:default project_id=5743 project_image_fid=953]

Designed by <a href="https://www.apartments.com.au/architects/marchese-partners">Marchese Partners</a>, the tower responds directly to its riverfront setting through expansive glazing and open-plan layouts that maximise views across the Parramatta River and city skyline. Interiors feature engineered timber flooring, stone benchtops, stainless steel appliances and floor-to-ceiling glazing, while generous balconies extend the living spaces outdoors.

Marchese Partners says the project was conceived to balance high-quality apartment living with practical, long-term functionality, pairing larger, efficient floorplans with amenities more commonly associated with five-star hotels.

That emphasis continues through the resident facilities, which include a 20-metre rooftop swimming pool, fully equipped gym and wellness spaces, full-time concierge, a residents' lounge, function room, private lifts, secure basement parking and rooftop communal areas overlooking the Parramatta River. Ground-floor boardwalk retail and dining further activate the riverfront and integrate the building into the surrounding public realm.

[smartcode_project:default project_id=5743 project_image_fid=925]

Australian housing and finance group Equitifund has secured the remaining apartments, believing there are few completed apartment opportunities in Parramatta that offer the same combination of location, amenity and pricing.

Equitifund National Sales Director Ben Hamblett says buyers are increasingly recognising that premium apartment living no longer needs to come with Sydney CBD pricing.

"The Lennox is where aspirational living becomes attainable," Hamblett said.

"Wake to river and mountain views, step into Sydney's Second CBD, and arrive home to resort-calibre amenities, all without the harbour price tag."

Hamblett says owner-occupiers are also attracted by the convenience of having Westfield Parramatta, Church Street's dining precinct, Parramatta Park, Riverside Theatres, Western Sydney University and major transport connections all within walking distance.

"At The Lennox, lifestyle is not an afterthought, it is the foundation."

[smartcode_project:default project_id=5743 project_image_fid=5374]

The Lennox places residents within walking distance of Parramatta Square, Westfield Parramatta, Church Street Eat Street, Parramatta Station, the ferry wharf, Light Rail, the future Sydney Metro West, Parramatta Park and CommBank Stadium, reinforcing Parramatta's position as one of Australia's most connected metropolitan centres outside Sydney's CBD.

Equitifund says buyers visiting the display suite consistently comment on the quality of the finishes, generous floorplans, river and skyline views, and the walkability of the location. The project has attracted a broad mix of local professionals, upsizers, downsizers, buyers relocating from Sydney's inner suburbs and interstate investors seeking long-term growth opportunities.

That demand aligns with Parramatta's continued evolution as an economic powerhouse. Equitifund Research and Market Insights specialist John Bekiaris says sustained population growth, infrastructure investment and expanding employment opportunities continue to support long-term housing demand across the city.

"Parramatta has evolved from a satellite city into one of Australia's most important economic centres. Population growth, infrastructure investment and employment are all supporting sustained long-term housing demand."

[smartcode_project_cta:default project_id=5743]

The apartment price gap drawing Sydney buyers west

A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Rainbow Bay apartment doubles in price since off the plan sale during pandemic

Smsfs

<html><body>
ASIC has accepted an enforceable undertaking from Ascentiv Group Pty Ltd, based in Mascot, New South Wales, and its sole director, Mr Chris Pappas.
An ASIC surveillance of Ascentiv, the holder of an Australian financial services (AFS) licence, found concerns about Ascentiv's advice to clients to establish or use a self-managed superannuation fund (SMSF).
In particular, ASIC had concerns about Ascentiv's failure to:
<ul>
<li>ensure its representatives provide SMSF advice that was appropriate and in the best interests of their clients</li>
<li>adequately manage conflicts of interest</li>
<li>adequately monitor and supervise its representatives, and</li>
<li>ensure its representatives were adequately trained and competent to provide SMSF advice.</li>
</ul>
According to ASIC, surveillance also found that Ascentiv failed to provide its clients with clear and concise statements of advice. 
"Instead the statements of advice were very lengthy and difficult to understand, making it difficult for Ascentiv's clients to make informed decisions about the advice provided to them," ASIC said.
"Under the EU, Ascentiv has agreed to cancel its AFS licence and write to some of its existing clients to inform them of the EU and the clients' rights to dispute resolution."
Mr Pappas has also undertaken to:
<ul>
<li>give a copy of the EU to any AFS licensee that authorises him to provide financial services in the future;</li>
<li>complete further SMSF specialist training before becoming a representative of an AFS licensee; and</li>
<li>refrain from becoming an AFS licensee or office holder of an AFS licensee for two years.</li>
</ul>
ASIC Deputy Chairman, Peter Kell said elf-managed super funds are not appropriate for everyone. It is important that the advice provided to clients of financial advisers is appropriate for those individuals' needs and circumstances.
'ASIC further expects that AFS licensees that provide SMSF advice to adequately monitor their representatives and have processes which lead to the provision of high quality SMSF advice," he said.
"ASIC will intervene where it finds the quality of advice provided by advisers and the supervision of those advisers by the licensee to be lacking."
ASIC acknowledges Ascentiv and Mr Pappas' cooperation throughout the process.
</body></html>

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ASIC accepts enforceable undertaking from Ascentiv Group relating to SMSF advice 

<html><body>
Guest Observer
 
One of the most disturbing aspects of the $500,000 lifetime non-concessional contribution (NCC) cap announcement in the 3 May 2016 Federal Budget is that the new lifetime NCC cap catches prior NCC’s made since 1 July 2007.
We consider the implementation of this announcement would effectively give rise to retrospective legislation for almost 9 years (ie, 1 July 2007 to 7.30pm (AEST) on 3 May 2016 is around 3,230 days or just over 8.8 years). Thus, people who have previously relied on the law during this 9 year period in making contributions to their super funds may now have no or little lifetime NCC cap left remaining.
We acknowledge that if your NCCs made during the prior 9 year period did not exceed $500,000, then there may be some remaining cap. For example, if someone had only made $10,000 of NCCs, they will have a $490,000 remaining cap.
However, if someone makes an NCC after the Budget announcement at 7.30pm on 3 May 2016, including any NCCs made in the prior 9 year period that exceeds $500,000, then their super fund must either reject any excess amount or the excess will be taxed at 49% if the member leaves the excess in their super account if possible. (There is doubt as to whether the announcement will allow the excess to remain in the superannuation fund given the little detail on this announced change).
If we trace back recent history, recent limits on making NCCs can be summarised as follows:
•        NCCs prior to 7.30 pm 9 May 2006 — unlimited;
•        NCCs from 9 May 2006 to 30 June 2007 — $1 million;
•        NCC from 1 July 2007 to 7.30 pm 3 May 2016 — $180,000 (indexed figure) per financial year or $540,000 averaged over three consecutive financial years where the member was under age 65 and was eligible to apply the bring forward rule in s 295-85(3) of the Income Tax Assessment Act 1997 (Cth) (‘ITAA 1997’); and
·                NCCs from 1 July 2007 to 7.30pm 3 May 2016 — $500,000 as reduced by any NCCs made from 1 July 2007.
As you can see, given the far more generous contribution caps applying before 4 May 2016, the $500,000 lifetime cap is a retrospective and an unfair change of law made by way of Budget announcement especially as it may not survive the political and legal process that lies ahead.
Before anyone who has made NCCs in the past 9 years makes any further contributions to superannuation, they would be well advised to request ATO confirmation of their NCCs to check whether they will exceed the new cap. The Budget Paper confirms that:
To ensure maximum effectiveness the lifetime cap will take into account all non-concessional contributions made on or after 1 July 2007, from which time the Australian Taxation Office has reliable contributions records …
<h2>Other points on retrospective law</h2>
The Treasurer, Mr Scott Morrison, may argue that the new cap is not retrospective as it does not require NCCs that already exceed $500,000 on 3 May 2016 to be rejected and therefore prior contributions are not adversely impacted.
However, this is an argument equivalent to an argument about ‘splitting hairs’. The prior law permitted NCCs of $180,000 per financial year or $540,000 over three consecutive financial years (if the bring forward rule applied). Moreover, let’s assume that someone had contributed $540,000 of NCCs during the prior 9 years and now wishes to contribute more, they now have a nil lifetime cap. When did the current Government warn the public that the ‘rug may be pulled from underneath them?’
Indeed, the Government has repeatedly promised (particularly leading up to the 2013 election) that there would be no adverse changes in its next term of office without appropriate consultation. In particular, in January 2013, the Coalition released its pre-election policy document Real Solutions, which pledged to "deliver greater stability and certainty" around superannuation laws. "We won't move the goalposts... We will ensure that no more negative unexpected changes occur to the superannuation system," the document said.
However, following Mr Malcolm Turnbull’s appointment as Prime Minister in September 2015, he confirmed that under a Turnbull Government prior policies could be changed. “We've got to be agile all the time" Mr Turnbull told AM's Michael Brissenden on 21 September 2015.
This is despite the repeated requests for stability in respect of our superannuation law due to the ‘long-term’ nature of being locked into a regulatory environment where someone cannot withdraw their money if there is an adverse change in law.
The usual process of retrospective legislation
The Australian Law Reform Commission (‘ALRC’) report on retrospective law recognises that retrospective tax laws may be introduced, typically for tax avoidance or integrity type measures. Moreover, when retrospective tax laws are introduced, they usually only apply for a relatively short-time frame.
Also, these type of retroactive tax changes to address tax avoidance and integrity announcements should be contrasted with superannuation measures where people are ‘locked into’ a regulatory system without being able to easily withdraw their savings. Indeed, most people cannot access their superannuation until they attain age 65 (subject to strict exceptions under strict preservation rules).
The Senate has processes intended to minimise periods of retrospectivity. Standing Order 44 provides that where tax legislation has been announced by press release more than six months before the introduction of the relevant legislation into Parliament (or publication of a draft bill), that legislation will be amended to provide for a commencement date after the date of introduction (or publication).
Further, Ms Michelle Gordon, a High Court judge, commented that retrospective tax law is not only hurting taxpayers but may be making foreign investment less attractive. This comment was made during her presentation to tax experts at the University of Melbourne law school in late August 2012 when she was then a Federal Court judge.
Given that all Federal legislative processes are now in ‘care taker’ mode until after the election on 2 July 2016, there is going to be considerable uncertainty as to whether this lifetime cap announcement will become law and if it does, in what form. The Labor Government has ruled out any retrospectivity to this reform should it win the election.
More detail on the $500,000 lifetime cap
This article has put forward numerous reasons why retrospective law stretching back nearly 9 years should not be tolerated by the Australian community.
Assuming, despite these reasons, that the Government persists to introduce a $500,000 lifetime NCC cap, we note that such a cap is surprisingly low given the summary provided above where some 10 years ago, the amount of personal NCCs (then known as ‘undeducted contributions’) were unlimited in amount.
The NCC cap was then, following a brief transitional period, reduced to $150,000 (as indexed on 1 July 2014 to $180,000) per FY subject to then a $450,000 (as indexed on 1 July 2014 to $540,000) three year bring forward rule until 3 May 2016. This 10 year slide has been a major restriction on what people could previously have contributed to their super savings.
Certainly, there were numerous submissions to Government by different industry bodies and members of the community to restrict the tax concessions in relation to superannuation for those people who had attained a certain monetary threshold within the super system. However, the Government’s response overlooks the fact that these people had contributed on the basis of the law as then applying (which was unlimited prior to the budget announcement in May 2006) and as a result, the Government should not overly restrict the ability for everyone else to accumulate a reasonable amount in superannuation to provide a satisfactory lifestyle in their retirement.
Assuming the Government sees the light of day and drops the retrospective nature of the $500,000 lifetime cap, we also consider the Government has overreacted with a $500,000 lifetime cap. Such a cap does not allow any flexibility for the numerous investment timing and life cycle risks that may arise which we examine in further detail below.
What if a member suffers an investment loss?
Many who have previously contributed more than $500,000 have lost considerable value — many losing far more than 50% on their investments — as a result of the global financial crisis (‘GFC’).
A $500,000 lifetime cap provides no scope or flexibility for these people who may suffer another GFC or another market correction (as in the October 1987 share market crash), where a substantial value of their lifetime savings may be lost in volatile trading over a short-time frame.
Indeed, there are many who were hoping to retire but got GFC’d and are still in the workforce at age 65 and 70, who expected to retire much earlier.
Moreover there have been many thousands of people who have suffered from one of the many fraudulent investment schemes and who will have no chance to accumulate any further super savings as they will generally have burnt up their lifetime NCC cap but unfortunately, and through no fault of their own, have zero or next to no dollars remaining in superannuation.
SMSFs that have entered into contracts pre-budget
SMSFs that have entered into contracts and transactions to buy investments, incurring limited recourse borrowing arrangements to gear up an investment property and other investment contacts that span 7.30pm 3 May 2016, may now be in default of such contracts and stand to lose deposits and suffer considerable loss and damages as a result of the threatened retrospective impact of the new lifetime NCC cap.
So with a mere Budget announcement without any forewarning or transitioning rule, many peoples’ superannuation planning may now be in ruins by the announced change in law.
In contrast, when changes were made to restrict SMSFs investing related unit trusts on 11 August 1999, a special 10 year transitional rule was introduced to allow an SMSF that invested in a related unit trust with borrowings to invest in further units up to 30 June 2009 to enable the unit trust to reduce its debt. Without the introduction of s 71E of the Superannuation Industry (Supervision) Act 1993 (Cth) (‘SISA’), SMSFs would have similarly been caught by an announced change but were granted a 10 year transitioning period.
The timing of the $500,000 lifetime NCC cap is particularly adverse for many SMSFs with related party LRBAs that need considerable cash flow before 30 June 2016 to place their LRBAs on arm’s length terms to comply with recent ATO guidelines. For these SMSFs to comply with the ATO’s recently released Practice Compliance Guideline PCG 2016/5, relevant SMSFs need to make the entire outstanding 2016 FY payments of principal and interest on non-arm’s length loans before 30 June 2016.
Impact on small business
The new cap is particularly unfortunate for business owners who generally are not in a financial position to contribute super throughout their lives and fall outside the CGT small business concessions in div 152 of the ITAA 1997. Many small business owners treat their business as a ‘de facto’ superannuation savings vehicle as they generally do not have enough cash to contribute to superannuation as they are building their business.
Small business owners will also have limited capacity to utilise their SMSFs from now on to acquire their business premises. The proposed lifetime NCC cap will adversely affect many small businesses, farmers and others that wish to invest in real estate, with many properties now in capital cities (and farm land on the city fringes) valued far in excess of $1 million.
Transfers from overseas to Australian superannuation funds
Those seeking to make transfers funds from foreign superannuation funds will also now be limited on what they can transfer to Australian superannuation funds.
Without the ability to transfer savings from foreign superannuation funds, many will leave their moneys in these overseas funds as the upfront tax cost on repatriation may be unviable compared to drawing a steady pension.
Australia should encourage foreign savings to be invested here, but the new lifetime cap imposes severe limits on these savings being available to produce any benefit to the Australian economy.
Conclusions
If there is to be announced legislation by budget or press release, then it should prospective. Being prospective, if the limit is $500,000 then most people will hopefully adjust and learn to live with this new limit. However, to then seek to impose a retrospective 9 year inclusion period on prior contributions when people have gone about their affairs in an ordinary and lawful manner is unreasonable and should not be tolerated by our community. Indeed, the current Government has misrepresented that there will be no adverse super changes. A change of Prime Minister in September 2015 is no excuse for such poor law making.
 
This was written by DBA Lawyers Director Daniel Butler and Special Counsel Rebecca James, who can be contacted below
Daniel Butler, Director (<a href="mailto:dbutler@dbalawyers.com.au" target="_blank">dbutler@dbalawyers.com.au</a>) 
Rebecca James, Special Counsel (<a href="mailto:rjames@dbalawyers.com.au" target="_blank">rjames@dbalawyers.com.au</a>)
 
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j.ballantyne1990-6AQqhLzZaK

The new $500,000 lifetime contribution cap is retrospective and bad law

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The average balance of self-managed super funds has topped $1 million for the first time, the latest tax office statistics show. It was at around $800,000 four years ago.
SMSFs returned 9.8 percent on assets in fiscal 2014, the fifth consecutive year of positive returns.
"For the first time the average assets of SMSFs grew to over $1 million in 2014, a growth of 23 percent over five years," ATO assistant commissioner Kasey Macfarlane said.
"Likewise, average assets per member increased to $564,000, the highest over the period," Fairfax Media reported.
The data shows there are one million members of DIY super funds which combined are worth $590 billion in assets.
The average assets per small fund are $1,066,080 and median assets $602,629.
Nearly 31percent of SMSFs now have assets of $1 million or over, including 10.8 percent with assets between $2 million to $5 million; 2.1percent in the $5 million to $10 million range and 0.5percent with a balance over $10 million.
 
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jchancellor-FAypfDUnLy

SMSF average balance hits $1 million

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GUEST OBSERVER
The ATO have released important information detailing interest rates, loan-to-value ratios (‘LVRs’) and other terms that constitute safe harbours for SMSF limited recourse borrowing arrangements (‘LRBAs’) so that arrangements will be taken to be consistent with an arm’s length dealing. The ATO is officially calling their release a ‘Practical Compliance Guideline’.
Broadly speaking, LRBAs consistent with arm’s length terms should not give rise to non-arm’s length income (‘NALI’). On the other hand, LRBAs that are not consistent with arm’s length terms will attract NALI.
It is important to note here that many refer to non-arm’s length LRBAs as ‘related party’ LRBAs. However, some SMSFs have obtained loans from unrelated parties such as friends that are not related parties that still fall under the ATO’s target of LRBAs that are not on arm’s length terms. Accordingly, in this article we refer to ‘non-bank’ LRBAs.
Accordingly, this ATO Practical Compliance Guideline is critical for:
·         SMSF trustees that have already entered into LRBAs as action might be required; and
·         SMSF trustees that are considering entering into LRBAs,
that are not financed by a bank.
SMSF trustees that have already entered into non-bank LRBAs might need to revise the terms of the loan or take other timely corrective action by 30 June 2016. In view of the ATO safe harbours, we strongly recommend that a review be undertaken of every LRBA that is not financed by a bank as soon as practicable and in any event prior to 30 June 2016.
DBA Lawyers provides advice and documentation in respect of all SMSF matters and  we also offer a fixed fee service to alter the terms of an existing LRBA with appropriate documentation. Indeed, there are LRBAs that have insufficient documentation in place that are not consistent with arm’s length terms.
Background
At the risk of oversimplifying, to the extent that an SMSF has NALI, that income is taxed at a very high rate (47% in the 2016 financial year) even if the fund is in pension mode. 
When the predecessor of the current LRBA laws (ie, the old instalment-warrant exception in the now repealed s 67(4A)) was first introduced in 2007, a question mark was over non-bank loans that have terms that favour the SMSF. In this regard, see ATO Taxpayer Alert TA 2008/5.
In 2010 the ATO released ATO ID 2010/162, which considered whether an SMSF trustee contravenes the arm’s length provisions of the Superannuation Industry (Supervision) Act 1993 (Cth) ‘if it borrows money from a related party of the SMSF under a limited recourse borrowing arrangement on terms favourable to the SMSF?’ The ATO answered this in the negative saying that it was not a contravention.
Later on, in the December 2012 NTLG minutes, the issue of interest free or low interest loans to SMSF trustees was considered. These minutes record that ‘ATO ID 2010/162 failed to identify whether any other provisions of the superannuation or tax law would be contravened by the trustee entering into a no interest or low interest limited recourse loan arrangement.’
These minutes went on to state:
The ATO position on low rate loan arrangements and LRBA is that that they do not generally invoke a contravention of the SISA, do not give rise to non-arm's length income under section 295-550 of the Income Tax Assessment Act 1997 (ITAA), do not invoke Part IVA of the ITAA 1936 and are not considered to give rise to contributions to the SMSF just from that one fact alone. [Emphasis added]
Accordingly, this piqued the interest of some in non-bank LRBAs that favour the SMSF.
However, DBA Lawyers has always felt non-bank LRBAs pose risks and NTLG minutes are not binding. Accordingly, we have always cautioned our clients to keep all LRBA terms on an arm’s length basis.
In December 2014 the ATO released ATO ID 2014/39 and ATO ID 2014/40 (since replaced — but not practically altered — by ATO ID 2015/27 and ATO ID 2015/28 respectively). These both considered non-bank LRBAs with nil interest being charged and both stated that the ATO’s view is that the arrangements did give rise to NALI.
Accordingly, the position that DBA Lawyers had long been in favour of then became broadly well accepted by all in the industry, namely, that non-bank LRBAs should be on the same terms that would be agreed with an arm’s length lender.
In December 2014 the ATO released a page on their website (since taken off the ATO’s website, <a href="https://web.archive.org/web/20150322033333/https://www.ato.gov.au/Super/Self-managed-super-funds/In-detail/News/Non-commercial-limited-recourse-borrowing-arrangements/" target="_blank">available here</a> stating:
To be able to demonstrate that NALI does not arise, a fund trustee entering into an LRBA with a related-party borrower should obtain and keep documentation that enables them to establish that the terms of the loan, taken together, and the ongoing operation of the loan are consistent with what an arm’s length lender dealing at arm’s length would accept in relation to the particular borrowing by the fund trustee. 
Accordingly, the importance of benchmarking terms of non-bank LRBAs to what, for example, a bank might offer, was reinforced to the entire industry.
However, in a practical sense, benchmarking can be difficult. Accordingly, the ATO safe harbours are a very positive step and the ATO should be commended for developing and releasing them.
Terms of the safe harbour
The Practical Compliance Guideline states that the ATO:
will accept that an LRBA structured in accordance with this Guideline is consistent with an arm’s length dealing and that the NALI provisions do not apply purely because of the terms of the borrowing arrangement.
At the risk of oversimplifying, essentially the terms are as follows:
<a href="/images/2016/04/8/Screen%20Shot%202016-04-08%20at%209.36.17%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/04/8/Screen%20Shot%202016-04-08%20at%209.36.17%20AM.png" alt="">
The Practical Compliance Guideline also provides further detailed guidance regarding the specifics of setting interest rates, particularly for fixed versus variable loans.
What to do if an existing non-bank LRBA does not meet the safe harbour
Advisers should contact all clients with non-bank LRBAs and tell them to read the Practical Compliance Guideline in full. Naturally, this article is just a summary and does not do the Practical Compliance Guideline justice.
If the existing LRBA does not meet the safe harbours set out above, the Practical Compliance Guideline provides the follow options by 30 June 2016:
·         Option 1 — Change the terms so that they are consistent with an arm’s length dealing by 30 June 2016. 
·         Option 2 — Bring the LRBA to an end by 30 June 2016.
·         Option 3 — Refinance to a commercial lender by 30 June 2016.
The ATO also require all non-bank LRBAs to be put on arm’s length terms on or before 30 June 2016. This includes, for example, SMSFs being required to pay a full year’s repayments under loans prior to 30 June 2016. This may place many SMSFs under financial stress given that they only have limited time available to come up with substantial cash funding. 
Moreover, from 1 July 2016 LRBAs covered by the ATO’s safe harbour will need to make regular monthly repayments of principal and interest. As you would be aware, some non-bank LRBAs may have allowed more flexible repayments such as only requiring annual payments and some only required full repayment on finalisation of the loan term.
The closeness of 30 June 2016 cannot be overemphasised. All advisers (and then SMSF trustees) should act immediately as time is needed to obtaining advice, prepare documents and arrange the cash flow to be obtained and transferred before the 30 June deadline If the 30 June deadline is not practical and is likely to be overshot, then expert advice should be obtained as soon as practical as a special approach to the ATO may be required.
Interesting points to note
Assets not covered by the safe harbours
What should one now make of non-bank LRBAs that are not covered by the safe harbour?
First, the safe harbours in the Practical Compliance Guideline only expressly apply to:
·         real property;
·         a collection of shares in a stock exchange listed company; and
·         a collection of units in a stock exchange listed unit trust.
 
For example, if an SMSF trustee has borrowed from a non-bank to acquire units in a specific class of units in certain Vanguard managed funds what action should the SMSF trustee take? Many think of such an investment as being tantamount to a listed security, but technically it’s not.
Perhaps somewhat more controversially, what to do if an SMSF trustee has borrowed to acquire units in a related trust such as a reg 13.22C/div 13.3A unit trust?
Given there is no safe harbour available, the ATO’s comments from December 2014 are more important than ever, namely: 
To be able to demonstrate that NALI does not arise, a fund trustee entering into an LRBA with a related party borrower should obtain and keep documentation that enables them to establish that the terms of the loan, taken together, and the ongoing operation of the loan are consistent with what an arm’s length lender dealing at arm’s length would accept in relation to the particular borrowing by the fund trustee.’
Therefore the onus is on the SMSF trustee to obtain sufficient and appropriate evidence to support the arm’s length nature of the terms of their LRBA. This may be difficult where there is no readily available market information and quotes and proposals from third parties and other sources may need to be researched and documented.
Indeed, some may not wish to continue with a non-bank lender and may prefer to refinance with a bank.
Actually calculating the loan-to-value ratio
How is the LVR calculated? More specifically, is the ‘value’ of the real property its value excluding GST, stamp duty and other similar costs? In the absence of ATO clarification, the conservative approach is to assume that the answer is yes.
The ATO require the market value to be established at the time of the relevant loan. Thus, the market value of the asset will generally be at the time of refinancing or if there is no refinancing at the date of the original loan.
Multiple assets for one loan
The Practical Compliance Guideline reinforces that it is possible to have multiple loans to acquire one asset. More specifically, it states:
If more than one loan is taken out in respect of the acquisition of the asset, the total amount of all those loans must not exceed [for real property] 70% of the asset’s market value [or 50% for listed securities].
What does ‘real property’ mean?
The Practical Compliance Guideline refers to real property. On first blush it seems to cover all real property, referring to ‘real property, whether that property is residential or commercial premises (including property used for primary production activities)’.
However, there are a lot of ambiguous assets which might be seen as real property or might not be so seen, such as:
·         A tenants in common interest in real estate — technically this is real property but the ATO do not expressly mention a non-bank lending to an SMSF to acquire a, for example, 50% tenants in common interest in a house using a 70% LVR and a 5.75% interest rate.
·         Life interests in real estate or listed shares/units — technically this is real property, but similar to tenants in common we doubt whether the ATO would be comfortable with an SMSF using these safe harbours to acquire such an asset.
·         Shares in a real estate company — there exists ‘company title’ whereby a property does not have a plan of subdivision per se but rather comprises a number of apartments and a company owns all the property and by buying, for example, all of the C class shares the owner of the shares has exclusive possession to apartment number 3. Technically, such shares are not real property. However, there are certain areas of the laws that essentially allows them to be treated as real property (such as the CGT main residence exemption). The conservative position would be to treat such shares in a real estate company as not constituting real estate for the safe harbour relief and apply to the ATO for SMSF specific advice.
Don’t interpret the safe harbours for something they are not
The safe harbours do not state that just because the terms in the Practical Compliance Guideline are satisfied NALI can never occur. Rather, they have the following more restrained comment ‘an LRBA structured in accordance with this Guideline is consistent with an arm’s length dealing and that the NALI provisions do not apply purely because of the terms of the borrowing arrangement’ (emphasis added). For example, if an SMSF acquires an asset for a non-market value from a related party, NALI could apply (refer Darrelen Pty Ltd v Commissioner of Taxation [2010] FCAFC 35).
Conclusions
The safe harbours are critically important. They are a very practical solution and the ATO should be commended accordingly for its positive manner in managing these non-bank LRBAs.
All non-bank LRBAs should be reviewed and appropriate taken by 30 June 2016.
 
Bryce Figot and Daniel Butler are directors, DBA Lawyers and can be contacted <a href="https://www.dbalawyers.com.au" target="_blank">here</a>.
This article is for general information only and should not be relied upon without first seeking advice from an appropriately qualified professional.
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ATO releases critical safe harbours for non-bank SMSF LRBAs

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Following ASIC raising concerns, Urban Seed Project Marketing Pty Ltd (Urban Seed), Skybridge Portfolios (Skybridge) Pty Ltd and Tatnell DLS (Tatnell) Pty Ltd have taken steps to remove or amend potentially misleading representations about Self Managed Super Funds (SMSFs) in social media advertising.
Skybridge and Tatnell
Skybridge’s Facebook page included representations such as “Get yourself a SMSF for your Super – from $99, fully advised. No industry fund can compete with this” and “Want your Super Fund to replace your current income from work? You need to look at a SMSF – highest account balances out of all Super Funds.”
Tatnell’s YouTube videos included representations favourably comparing SMSFs to other superannuation funds without explaining or referencing the range of factors that will contribute to whether an SMSF is better performing or lower cost to consumers than industry and retail funds. 
ASIC was concerned that the representations made by Skybridge and Tatnell were potentially misleading about the benefits, risks and costs associated with SMSFs. Advertisements regarding financial products, including SMSFs, should give a balanced message about the returns, features, benefits and risks associated with a product. They should also not draw comparisons with other products without qualification or substantiation. 
Urban Seed
Urban Seed’s YouTube videos linked to a promotional website which included representations about “SMSF qualified” and “SMSF friendly” properties available for sale.
ASIC was concerned that the promotional website suggested that there was a category of property particularly suited to investment through an SMSF. Whether or not property is suitable for purchase through an SMSF will depend upon the investment strategy of the SMSF purchasing the property and the circumstances of the purchase. 
ASIC Deputy Chair Peter Kell said, ‘Accuracy in advertising is integral to maintaining consumer trust and confidence in the SMSF sector. ASIC will continue to take action where we  see advertising that might mislead consumers, whether that advertising is on social media or more traditional media '
Skybridge, Urban Seed and Tatnell have all removed the relevant posts and videos, have ensured future marketing on social media will undergo appropriate review and approvals processes, and have fully cooperated in responding to ASIC's concerns.
Background
With the growing popularity of social media sites including Facebook, Twitter and YouTube, social media has become an increasingly important channel for the promotion of financial products and services, including SMSFs. 
In 2012 in response to the growth in SMSFs, ASIC established the SMSF Taskforce. A specific focus of the taskforce has been misleading advertising of SMSFs. Particular problems identified include misleading or deceptive statements about SMSF fees, returns and risks. 
In 2014 and 2015 ASIC’s SMSF Taskforce expanded its work on SMSF advertising to include a review of online SMSF advertising through social media platforms such as Twitter, Facebook and Youtube. 
Outcomes and actions stemming from the SMSF Taskforce include:
<ul>
<li>Following an ASIC investigation, Ms Sarah Jane Busteed was charged with three counts of dishonestly obtaining a financial advantage by deception and one count of dealing with over $100,000 that was the proceeds of crime (refer: 16-040MR);</li>
<li>Superannuation Warehouse Australia Pty Ltd was ordered to pay a penalty of $25,000 for false and misleading“Free SMSF Setup” advertising (refer: 15-332MR);</li>
<li>The Supreme Court of NSW found Park Trent Properties Group Pty Ltd had been unlawfully carrying on a financial services business for over five years by providing advice to clients to purchase investment properties through a SMSF (refer: 15-300MR);</li>
<li>Dixon Advisory Group Limited complied with two ASIC infringement notices, paying two $10,200 penalties after including potentially misleading claims on its website (refer: 15-207MR);</li>
<li>The credit licence of Queensland-based Smithson &amp; Baye was cancelled following an investigation into a property and SMSF promoting group (refer: 15-228MR<a href="https://asic.gov.au/about-asic/media-centre/find-a-media-release/2015-releases/15-228mr-asic-cancels-australian-credit-licence-of-queensland-company-involved-with-property-promoting-group/">)</a>;</li>
<li>ASIC released two information sheets to improve the quality of advice provided by advisers on  SMSFs: Information Sheet 205Advice on self-managed superannuation funds: Disclosure of risks (INFO 205) and Information Sheet 206 Advice on self-managed superannuation funds: Disclosure of costs <a href="https://www.asic.gov.au/regulatory-resources/financial-services/giving-financial-product-advice/advice-on-self-managed-superannuation-funds-disclosure-of-costs/">(</a>INFO 206) (refer 15-192MR).</li>
<li>Omniwealth Services paid a $10,200 penalty for potentially misleading claims on its website (refer: 15-190MR);</li>
<li>The principal of Sherwin Financial Planners, Bradley Thomas Sherwin, was charged with fraud. The charges relate to the use of SMSFs of former clients of Sherwin Financial Planners (refer: 15-158MR);</li>
<li>The Federal Court of Australia ruled that Craig Gore and several other parties and financial services businesses, including Queensland-based ActiveSuper and Royale Capital, contravened sections of the Corporations Act or were knowingly concerned in those contraventions. (refer: 15-134MR);</li>
<li>Australian Financial Planning Solutions Pty Ltd paid $10,200 in penalties for potentially misleading SMSF ads (refer: 15-052MR);</li>
<li>ASIC banned the founder of the Charterhill Group of Companies, George Nowak, from providing financial services until 3 July 2017 on the basis that Mr Nowak is an undischarged bankrupt (refer: 15-048MR);</li>
<li>Interprac Financial Planning agreed to address ASIC concerns relating to advice provided to some clients about SMSFs (refer: 14-258MR);</li>
<li>Sentry Financial Services agreed to address ASIC concerns about SMSF advice provided to clients (refer: 14-109MR);</li>
<li>SuperHelp Australia paid a $10,200 penalty after making potentially misleading statements about the cost of setting up SMSF (refer: 14-051MR);</li>
<li>Media Super paid $10,200 in penalties for potentially misleading SMSF ads (refer: 14-001MR);</li>
<li>Spring Financial Group entered into an enforceable undertaking following ASIC concerns about the level of monitoring and supervision of its representatives (refer: 13-263MR);</li>
<li>Anne Street Partners agreed to engage an independent expert following ASIC concerns about SMSF advice provided to clients (refer: 13-248MR); and</li>
<li>publishing Report 337 Improving the quality of advice given to SMSF investors. (refer: 13-081MR).</li>
</ul>
SMSFs will continue to be a focus in ASIC's enforcement work. Most recently, following an ASIC investigation, one New South Wales woman appeared in court on four charges, in relation to self-managed superannuation fund (SMSF) property purchases.
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ASIC warn of $99 SMSF social media campaign 

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Following an ASIC investigation, Sarah Jane Busteed has appeared in the Downing Centre Local Court in Sydney charged with three counts of dishonestly obtaining a financial advantage by deception and one count of dealing with over $100,000 that was the proceeds of crime. 
The New South Wales woman has appeared in court on four charges, in relation to self-managed superannuation fund (SMSF) property purchases. 
The ASIC investigation into Busteed's conduct in dealing with members of SMSFs which were undertaking property purchases, prompted ASIC to allege that Busteed dishonestly obtained monies from those SMSFs.
Busteed is also alleged to have dealt with monies obtained from a SMSF which are believed to be proceeds of crime. 
Busteed was not required to enter a plea and was granted conditional bail. The matter is listed for return at the Downing Centre Local Court on 12 April 2016. 
Under the New South Wales Crime Act, the charges of dishonestly obtaining a financial advantage by deception each carry a maximum penalty of 10 years imprisonment, while under the Commonwealth Criminal Code the charge of dealing in the proceeds of crime carries a maximum penalty of 20 years imprisonment or a $216,000 fine or both.
The investigation into Busteed’s conduct was carried out by ASIC’s SMSF Taskforce, which was established in 2012 in response to the growing popularity of SMSFs.
The Commonwealth Director of Public Prosecutions is prosecuting the charges against Busteed stemming from the ASIC investigation, while separate charges including dishonestly obtaining financial advantage have been bought against Busteed by the NSW Police and NSW Director of Public Prosecutions.
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SMSF deception charges follows ASIC investigation

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Property investments by SMSFs through limited recourse borrowing arrangements (LRBAs) could come under increased scrutiny of the tax office this year, says major accounting firm H&amp;R Block.
Last year, the ATO had expressed concern at LRBA loans that were not structured correctly, including incorrect registration of the ownership of property bought under an LRBA. It spoke of increasing its focus on the LRBA route.
Given the growth in the SMSF sector and the increasing popularity of strategies such as LRBAs, H&amp;R Block has tipped that property will remain a top priority for the ATO’s compliance work in the SMSF sector this year.
“I know the ATO always keeps a close eye on property investment and especially LRBAs,” H&amp;R Block's director of tax communications, Mark Chapman told SMSF Adviser.
This particularly applies to related party borrowings which may currently be structured on non-commercial terms, with a June 30 deadline to have these structures rectified, it said.
According to the ATO website, an asset purchased by an SMSF trustee through LRBA is held in a separate trust.
If the loan defaults, the lender's rights are limited to the asset held in the separate trust, but not to assets held in the SMSF.
In 2015, an ATO campaign saw 500 postcodes issued with warnings urging holiday home owners to ensure deductions were not made during periods a property was not available for let.
“With property rental a valuable source of extra income for millions of taxpayers, it can be expected that the ATO will follow up with some targeted reviews and audits this year,” Chapman was quoted as saying.
The “sharing economy” – “driven in part by the high levels of non-compliance amongst those driving for Uber or renting rooms through Airbnb,” would also be an area of scrutiny by the ATO, he said. 
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prateek24-ezbwHMbNAk

ATO to focus on LRBA route to property investment by SMSFs

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The Supreme Court of NSW found Park Trent Properties Group Pty Ltd (Park Trent) had been unlawfully carrying on a financial services business for over five years by providing advice to clients to purchase investment properties through a SMSF.
Acting Justice Sackville said it was in the public interest that Park Trent be restrained from carrying on a financial services business.
"There is a clear public interest in the court expressing its disapproval of Park Trent’s behaviour," the judgement advised.
ASIC launched legal proceedings in November 2014 against Park Trent who, by the time of the trial in June 2015 had advised over 860 members of the public to establish and switch funds into an SMSF.
In handing down his judgment, his Honour observed that Park Trent's business model depended on "persuading relatively unsophisticated investors of the virtues of using their superannuation accounts to purchase investment properties and to establish SMSFs… Investors were influenced to make important decisions concerning their superannuation strategy with little or no genuine consideration of whether the decision took proper account of their individual financial circumstances. Some suffered financial loss as a consequence."
His Honour also referred to the role of Park Trent's CEO, Ronald Cross and referred to his "willingness to ignore legal advice as to the nature of Park Trent's statutory obligations."
Mr Cross was the person who made all significant decisions within the Park Trent Group and "who was the controlling mind of Park Trent."
The reporting structure within the Park Trent Group makes it clear that Mr Cross, as the CEO, directed the activities of all companies within the group and responsible for the strategies that were employed to persuade clients to purchase properties.
"On the approach devised by Mr Cross, where a purchase of an investment property was feasible only through an SMSF, the client was advised as to the merits of setting up an SMSF to facilitate the purchase.
"Mr Cross personally conducted many of the seminars and was responsible for determining the content of the PowerPoint presentations made at seminars
"Mr Cross’ role included training all new sales consultants, a process that took place at Park Trent’s head office in Wollongong over a period of four days.".
His Honour said that his decision "serves as a warning to others who conduct or propose to conduct businesses which seek to influence clients to establish SMSFs for investment purposes, without having the necessary licence to do so."
"I have found that the making of recommendations and stating opinions as to the desirability of purchasing investment properties was integral to Park Trent’s business.
"But that finding does not mean that an injunction would prevent other companies within Park Trent Group continuing to conduct the business of selling investment properties to clients on a commission basis. That is precisely what Park Trent’s submissions contend that the other companies (except Easy Plan) have been doing throughout the Relevant Period.
"In any event, if any companies within the Park Trent Group suffer any prejudice, it is not “unfair prejudice” within the meaning of s 1101B(1) of the Corporations Act.
"If they do sustain any prejudice, it will be because Park Trent’s business in which they have participated and from which they may have derived some benefit, can no longer be conducted unlawfully.
"It should be noted that the proposed order does not restrain Park Trent from facilitating the purchase of investment properties by means of an SMSF." 
ASIC Deputy Chairman Peter Kell said the decision demonstrates the courts, ASIC and the public will not tolerate this type of "unscrupulous" behaviour.
"Property spruikers who recommend people invest in property via SMSFs, or facilitate such an investment, and who do not have an Australian financial services licence are breaking the law.
"ASIC’s message is that anyone recommending or facilitating SMSFs as a way of investing in property will need to have a licence and provide appropriate advice that prioritises the client's interests.
‘It is important that advisers who deal with SMSFs are appropriately licenced because the important safeguards and standards that come with being licenced are in place for a sector which is of growing importance to more Australian investors."
The court was told Park Trent's business model to a considerable extent, "depends on persuading relatively unsophisticated investors of the virtues of using their superannuation accounts to purchase investment properties and to establish SMSFs (at considerable expense) to enable the purchase to proceed.
"Park Trent’s contraventions of s 911A(1) of the Corporations Act have influenced investors to purchase investment properties through SMSFs without receiving appropriate financial advice," the judgement noted.
"Investors have therefore been influenced to make decisions that expose the investors and their superannuation accounts to significant risks of financial loss (notwithstanding the optimistic projections presented to them)."
The parties have until October 29 to file submissions on the form of final orders. Subject to any submissions by the parties on costs, his honour's present view was that Park Trent should pay ASIC’s costs of the nine day trial proceedings.
ASIC established a SMSF taskforce in 2012 to focus on high-risks in this sector, including potentially inappropriate geared investment strategies and increasingly aggressive advertising for SMSFs.
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Park Trent unlawfully ran financial services SMSF advisory

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Sydney had just two weekend apartment sales under $500,000 sold at weekend auction.
The cheapest was $400,000 for a studio apartment at 605/144 Mallett Street, Camperdown which sold auction eve.
It last sold at $279,000 in 2009, reflecting 5.6% annual price growth.
The 32sqm apartment sold through <a href="https://urbane.com.au/listings/residential_sale-492301-camperdown/" target="_blank">Charles Bailey at Urbane Property</a>.
It sold by a SMSF investor to a SMSF investor, currently renting at around $380 a week, reflecting 4.9% gross yield.
But there was the prospect of around $420 a week, buyers thought.
The other sub-$500,000 sale was $440,000 at Blackett.
APM had Sydney's median auction price as $1.15 million at the weekend. 
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Sydney's weekend cheapest $400,000 at Camperdown as SMSF investors sell and buy

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ASIC has cancelled the Australian credit licence of credit providers Smithson &amp; Baye as part of an ongoing investigation into a property and self-managed superannuation fund promoting group. 
The group includes the companies formerly called Heritage Financial Solutions Australia and Sunpac Finance Pty Ltd. 
The sole director and shareholder of Smithson &amp; Baye, Mr Ricardo Viana, is also the sole director and shareholder of Sunpac Finance.
ASIC found  Smithson &amp; Baye failed to keep adequate financial records, comply with notices to produce documents, comply with its licence conditions in order to make sure representatives comply with the credit legislation and ensure representatives were adequately trained. 
Smithson &amp; Baye purported to have accepted assignment of, and was collecting payments from borrowers in respect of, additional loans provided to clients of Heritage Financial Solutions and Sunpac Finance, beyond that which mainstream lenders would lend, to assist those clients to purchase real estate in Queensland through SMSFs.
ASIC found that:
<ul>
<li>Smithson &amp; Baye had contravened its obligations under the National Credit Act;</li>
<li>it had reason to believe that Smithson &amp; Baye was likely to contravene its obligations under the National Credit Act;</li>
<li>it had reason to believe that Smithson &amp; Baye is not fit and proper to engage in credit activities; and</li>
<li>there is no reasonable prospect that the defects in Smithson &amp; Baye's compliance with the National Credit Act can or would be remedied. </li>
</ul>
 
ASIC's investigation involves advice to investors to establish an SMSF for investment in real estate in Queensland and the arranging of finance for those investments.
ASIC has concerns about the way the loans and property ownership have been structured and advises anyone who obtained advice or finance from people associated with Heritage Financial Solutions, Sunpac Finance, Smithson &amp; Baye or Vegeta Pty Ltd (currently in liquidation) to contact their lender and obtain independent professional advice to ensure that the loans to their SMSFs and their property ownership have been structured in compliance with the trustees' superannuation law obligations.
ASIC's investigation is continuing.
Smithson &amp; Baye has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC's decision.
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