Property Valuations for Self-Managed Superannuation Funds

It is a legal requirement that all Self-Managed Superannuation Fund (SMSF) trustees provide the market value of assets held by the fund in their annual financial reports. This is necessary for compliance with regulation 8.02B of the Superannuation Industry (Supervision) Regulations 1994 (SISR). For assets comprising a significant proportion of the fund’s value, it is advisable that trustees attain a professional market valuation report to support their determination. Although these reports must be lodged annually, SMSF auditors only require valuations to be conducted at least every three years.

In recent years, the Australian Tax Office has refined their guidelines, tightening the range of evidential documents that are considered sufficient. Although other forms of evidence are still acceptable, single items on the following list are not enough alone to support a trustee’s market value determination:

• Independent appraisals from a real estate agent (kerbside)
• A recent contract of sale providing there have been no significant events since that could significantly alter the property’s value
• Recent data of comparable local sales
• A rates notice
• The annual net income of commercial properties

A market valuation report is a formal assessment of land or a building undertaken by a professional, certified valuer. It considers a number of key factors (either related directly to the property or to data about the general, local area) to estimate the current market value. A valuation report is an excellent document to support financial statements as it provides a comprehensive valuation that is supported by a range of carefully collected data. In addition to this, market valuation reports alone are sufficient for substantiating the market value of real property

At Hymans Property, our team is experienced in providing valuation reports to support SMSF statements. We ensure all reports are accurate, timely and compliant with government legislation. Our valuations include in-depth local market information, data analysis and insights.