GSR swaps within smsf

Discussion in 'Superannuation' started by Fykus, Sep 27, 2012.

  1. Fykus

    Fykus Member Silver Stacker

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    Was just wondering, how do you do gold silver ratio swaps within your smsf?
    I know you could do it with unallocated and or with physical, but when you do it how do you account for it within your super records? Do you make a note saying you swapped x silver worth $x for x gold worth $x? When you do this does it trigger some sort of capital gains event? Is it even allowed in your smsf?

    If anybody knows itd be much appreciated. Have been thinking about this lately as a way to eventually increase the size of my smsf stack outside of buying more pm's (which is a given anyway). Would be nice to know its possible to do for next time the ratio is favourable.

    Cheers
     
  2. Dirtbikepilot

    Dirtbikepilot Active Member

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    I would imagine you just sell one and by the other.
     
  3. hiho

    hiho Active Member Silver Stacker

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    its that simple, your SMSF is an account, all transactions are to be recorded and concise
     
  4. Fykus

    Fykus Member Silver Stacker

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    but wouldnt doing that cause a capital gains event? wouldnt it be easier to just outright trade one for the other so your not paying tax on the transaction?
     
  5. hiho

    hiho Active Member Silver Stacker

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    yes it would create a capital gain or loss event, but after 1 year CGT is reduced and Super tax is 15% normally anyway. Yes it would be easier but illegal sorry :(
     
  6. Fykus

    Fykus Member Silver Stacker

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    what if your holding it in unallocated? would it still be illegal?
     
  7. hiho

    hiho Active Member Silver Stacker

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    I doubt any unallocated fund would do a straight swap without two transactions taking place
     
  8. Fykus

    Fykus Member Silver Stacker

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    hmmm, hopefully gp will see this thread and respond.
    thanks for the replies fellas.
     
  9. malachii

    malachii Well-Known Member

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    It's not illegal to do one swap for the other - but it also won't stop the capital gains event. For tax purposes it's considered to be done at the "current price" at that time - whether cash has changed hands or not.

    malachii
     
  10. hiho

    hiho Active Member Silver Stacker

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    its illegal to avoid tax, that's the point
     
  11. Fykus

    Fykus Member Silver Stacker

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    thanks for clearing up my questions everybody, much appreciated.

    So im guessing that if you did it you would record the price of gold and silver at the time for tax purposes so that you can pay the tax on it at the end of the year?
     
  12. malachii

    malachii Well-Known Member

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    Sorry hiho - misunderstood you.

    Fykus - yes - if it's a straight swap the spot price would provide a suitable ratio.

    malachii
     
  13. REDBACK

    REDBACK Well-Known Member Silver Stacker

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    Would the ATO consider Spot price reasonable market value for the exchange?

    REDBACK
     
  14. malachii

    malachii Well-Known Member

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    Without putting words in the ATO's mouth - If you told them that was what the exchange was at, they would most likely accept it for things like bars etc. If you started trying it with lunar coins etc (and you got someone who knew a bit about PMs - yes a few in there do!) - then the chances are they would ask you to provide evidence as to why they should accept this value.

    As with any tax issue in Australia -with our self reporting system - you can say and do whatever you like. You just have to be able to justify it if you are challenged.

    malachii
     
  15. goldpelican

    goldpelican Administrator Staff Member

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    Basically two transactions - a disposal and acquisition. Capital gains or losses may be realised.

    A "swap" implies barter - which is treated the same. Sale and purchase with a fair market value assigned.
     
  16. Kawa

    Kawa New Member

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    Sale/Purchase in the SMSF is not the issue..it's the documentation that's important.

    As all SMSF are audited you must have a very clear paper trail of invoices that match what appears in your bank account.

    So if you swap I suggest you actually draw /transfer funds in the SMSF that marry with the intent of the swap and that matches what appears on the SMSF General bank account.

    I personally would not just use a note of the swap.

    In essence any swap needs to be broken down to a sale and purchase ( based on market value at the time) from an accounting point of view in the SMSF.
     
  17. zedstrange

    zedstrange Member

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    old thread i know, but this came up when i was searching for a similar topic on google.

    I do GSR swaps in my SMSF, and using the Perth Mint Depository (PMDS) program. I use e-superfnd (ESF) to manage my SMSF, and the first two GSR swaps I did, ESF ignored the transactions, but on the 3rd swap they calculated the CGT accordingly back to the original base cost obviously.

    I questioned that with them, obviously i was hoping to dispute it, because i would rather pay the CGT when I cash out from the PMDS, and they referred their auditor/advisor (no doubt their own staff) and declared that their application of the CGT accounting is correct under law.

    I raised this with an accountant, and he agreed with ESF.

    Obviously I still disagree with this on principle :) but nothing I can do.
     
  18. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Gee, that doesn’t sound like ESF.

    Much.
     

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