SMSF commercial property loans: buying your business premises through super.
Business real property is the most common reason small-business owners set up an SMSF for property. The 75 per cent test, the related-party leasing carve-out, and the commercial lender shortlist all need to line up.
The business-owner SMSF case.
You run a business. You pay rent every month to a landlord. That rent funds someone else's retirement. Buying the premises through your SMSF means that rent now flows into your own super fund instead. Inside super the rental income is taxed at 15 per cent. After 60, in pension phase, the rate can drop to zero.
The structure suits owners with a long-dated horizon for the building, sufficient fund balance, and a business that can sustain market-rate rent. It does not suit owners who need access to the equity for working capital or expansion. The standard commercial property loan route stays available for owners who want flexibility outside super, and the wider SMSF property investment guide covers how the two compare over a long hold.
What makes a property business real property.
The definition in the SIS Act is the trip wire. Get this part wrong and the whole structure unravels.
Wholly and exclusively used in a business
The 75 per cent test requires the property to be used wholly and exclusively in one or more businesses, run by anyone, including a related party.
Common qualifying types
Office suites, retail shopfronts, warehouses, light industrial units, medical and dental rooms, professional services premises. Not residential, not mixed-use beyond the 25 per cent threshold.
Common disqualifying patterns
A house with a home office. A short-stay rental dressed as a serviced apartment. A retail premises with a residential flat above on the same title. These usually fail the test.
Vacant land
Vacant land can qualify if it is held for a business use, but the path is narrower. The intended use, evidence of business activity, and timing all get tested.
Farms and primary production
Primary production land can qualify as business real property. The two-hectare residence carve-out is the area most commonly misread.
Documented evidence
Property use needs to be documented and supportable. The auditor will look at this. So will the ATO if they review the file later.
Related-party leasing, done properly.
If your SMSF leases the premises to your own business, the lease must look identical to one between strangers.
- Market-rate rent
An independent rental assessment is the cleanest evidence. Update the assessment every couple of years and at lease renewal.
- Written lease, proper terms
Standard commercial lease, signed by both parties, with rent reviews, outgoings, and term clauses written in. Not a one-page memo.
- Paid on time
Rent paid by the business on the due date, into the SMSF bank account. Arrears arrangements get flagged at audit.
- No mate’s rates either way
Below-market rent is a contravention. Above-market rent can be a contribution issue. Market is market.
Commercial SMSF lenders we use.
The commercial SMSF lending market is narrower than residential. Two lenders cover most of the files we write. The other two on the panel are sometimes worth running for a comparison. If the property itself is still being sourced, the commercial buyer's agent service runs alongside the lending workstream so contracts and bare trust set-up land in the right order.
- La Trobe Financial
- Mainstay for commercial SMSF lending. LVRs to ~70%. Stable policy.
- Granite Home Loans
- SMSF specialist with commercial appetite. Considered for files needing a policy read.
- Pepper Money
- Case by case on commercial. Useful for non-standard servicing patterns.
- Mortgage Ezy
- Mostly residential, but worth comparing when the file fits.
See the full SMSF lender comparison for residential-side detail.
Common questions on SMSF commercial property.
Business real property is real estate used wholly and exclusively in a business. The 75 per cent test in the SIS Act sets the bar. The classic example is a small-business owner whose SMSF buys the premises their company operates from. Mixed-use, holiday rentals, and residential with a side trade usually fail the test.
Yes, but only if the property qualifies as business real property and the lease is on arm's length commercial terms. Market rent, market lease conditions, paid on time. This is the carved-out exception to the in-house asset rule. Get the lease wrong and the asset becomes an in-house asset, which is capped at 5 per cent of fund value.
Broadly, an SMSF cannot lease or lend assets to a related party (members, their relatives, associated companies and trusts) beyond a 5 per cent cap. Business real property is the main exception. Residential property cannot be leased to a related party, full stop.
Generally 65 to 70 per cent. Some files stretch to 75 per cent with strong rental income and a solid fund balance. Below 65 per cent usually unlocks a better rate. La Trobe and Granite Home Loans are the two lenders we go to most for commercial SMSF.
Cash inside super is hard to access. Once your premises is in the SMSF, you cannot pull equity out the way you might from a personally owned commercial property. The strategy suits owners who want the building locked away for the long super horizon, not those who plan to refinance for working capital.
Yes. The strategic advice on whether the structure fits, the SoA, the lender, the bare trust coordination with your accountant or solicitor, and the post-settlement reviews. One practitioner across both authorisations.
Read further
- SMSF hubPillar overview of how Opes does SMSF.
- SMSF property loansResidential LRBA, eligibility, bare trust structure.
- SMSF lenders comparedSide-by-side comparison of the specialist panel.
- SMSF borrowing guideATO rules, pitfalls, and when SMSF property does not suit.
- Using super to buy propertyThe plain-language guide for first-time SMSF investors.
- Retirement planningWhere the SMSF commercial decision sits in the retirement strategy.
- Commercial property loansStandard commercial lending outside super for comparison.
Is SMSF commercial right for your business?
A short call to read the structure before you start spending on accountants and valuers.