If you are currently holding artworks in your self-managed superfund be aware that the new rules regarding storage and insurance which came into effect from July 2011 will need full compliance from July 2016.
The new rules for collectables (including artworks) and personal-use assets owned by a self-managed superfund stipulate that they must be stored according to the guidelines, be independently valued and covered by insurance. These rules applied immediately to any works purchased on or after 1 July 2011, with those existing collectibles held by self-managed superfunds given a five year transition period to comply bringing us up to the 30 June 2016.
In short, the new rules mean that trustees are allowed to invest in collectables with their self-managed super fund for the sole purpose of benefits in retirement, not for the enhancement of lifestyle now. So if you are enjoying your self-funded super painting on the wall… it’s time to take it down.
Other rules include items being insured against theft and damage, not being on display in a private residence, stored appropriately and while artworks can be leased to a gallery (provided the gallery is not owned/ operated by a related party) for display the trustees of the self-managed super fund must insure the artwork themselves, regardless if the gallery or storage facility provides its own insurance.
For the complete set of rules and more information on assets in your self-managed superfund visit the ATO: