Multiport predicts collectibles decrease
In light of the new rules for collectibles due to fully come into effect in 2016, Multiport’s Philip La Greca has predicted a continued decrease in the collectibles held in SMSFs.
Following the Cooper Review, rules related to ownership of collectibles in an SMSF have been tightened, with a series of new and specific standards to be met by the SMSF.
Most significantly, the collectible must be insured in the fund’s name within seven days of the SMSF acquiring it.
Multiport’s technical services director told SMSF Adviser he predicts a reduction and a refinement in the collectibles that are held within SMSFs as a result of these new requirements.
“I don’t think it will disappear as an investment, but I think it will become more focused,” Mr La Greca said.
“I think what we’ll see is a refinement. There will be less collectibles [and] I don’t think we’re going to see as much of the more … exotic things that people buy.”
However, SMSF Professionals' Association of Australia's (SPAA’s) director for technical and professional standards, Graeme Colley, has indicated collectibles can still be a worthwhile investment, provided trustees are “prudent”.
“It’s a matter of making sure the trustees meet the technical requirements … that is the valuation, the making sure that it’s not used, making sure it’s stored correctly, and making sure it’s insured,” he said.
