Recontribution Strategy

I wish to implement a recontribution strategy using an in specie transfer of shares (in 15 companies). As all the shareholdings are Issuer Sponsored I can use Off Market Transfer forms to transfer from the pension fund to myself. I can then use an Off Market Transfer form to transfer in specie back to the accumulation account (and then to a pension account) - transfer on the same day. Bearing in mind the ATO’s requirement that cash lump sums must be evidenced by actual cash transfers through the bank account (i.e not accounting entries) my question is : is the existence of properly executed Off Market Transfer forms sufficient or must all the transfer forms be sent to the Share Registry?

 

Hi John

I would prefer to see the transactions roll through a share registry.

Make sure you move them onto a broker once they are back in the SMSF. Also ensure all shares go back in on the same day, and ensure you work out all your market values correctly so not to breach any contribution caps.

Also ensure you have fun doing the transfer forms (I have done them and it sucks). Here is a hot tip - many of the details of the transferee and transferor are the same on every form. Fill those details out once and copy copy copy. Then just fill out the section on the specific stock that is being transferred - this saves a monza of time.

You are lucky the Government hasn't yet implemented the changes that would ban off market transfers - it was meant to come into place 1 July 2012, but has been delayed until at least 1 July 2013 (which is optimistic as there are other issues it would create).

Thanks

SM