When Parliament banned residential borrowing in super, it deliberately left one door open: business real property. LRBAs for commercial premises continue exactly as before — and for business owners, the strategy behind that door has always been the best one in the room anyway.
The play, in one paragraph
Your SMSF buys the premises your business runs from — borrowing part of the price if needed. The business pays market rent to the fund; the rent builds your retirement savings instead of a landlord’s; and the premises are held in a structure with real asset-protection qualities. At retirement the fund holds a debt-free commercial property that was paid for largely by rent your business had to pay someone anyway.
Why this survived the ban
The stated aim of the ban was to stop super leveraging into housing. Business real property doesn’t compete with home buyers, and the small-business-premises strategy has long been explicitly accommodated in super law — business real property is even exempt from the usual ban on acquiring assets from related parties. So the lending continues: banks and specialist lenders, typically 65–75% LVR.
The rules that still bite
- Sole-purpose test — the investment must genuinely serve members’ retirement, not prop up the business.
- Arm’s length everything — market price on purchase, market rent on the lease, enforced like a stranger’s lease.
- Liquidity — the fund must carry a buffer and service the loan from rent plus contributions, stress-tested.
- Structure — bare trust, corporate trustee, deeds in the right order before exchange. Unwinding mistakes is expensive.
Who this actually suits
Established business owners with stable premises needs and healthy super balances — tradies with a workshop, medicos with rooms, retailers with a proven site. It is not a way to speculate on commercial property with retirement money.
Common questions
What counts as business real property?
Real property used wholly and exclusively in one or more businesses — a shop, warehouse, office, clinic, or farmland. Residential premises generally don’t qualify unless they’re genuinely part of a business use. The classification is technical: get advice before you commit.
Can my SMSF buy my own business premises?
Yes — this is the classic strategy and it survived the ban. The fund buys the premises (borrowing via LRBA if needed) and leases it back to your business at market rent. Rent becomes retirement savings instead of a landlord’s income.
What deposit and rates should I expect?
Commercial SMSF lending typically wants 25–35% deposit (LVR 65–75%) and prices above standard commercial loans. The fund also needs post-settlement liquidity. It’s a bigger equity commitment than residential ever was — which is partly why it survived.
What are the non-negotiable rules?
Sole-purpose test (the investment must serve retirement benefits), arm’s-length terms (market rent, market price, real lease), and the LRBA structure done properly. The ATO watches related-party leases closely — this is not a DIY area.
Related: what the ban changed · refinancing an existing SMSF loan · SMSF lending after the ban
General information only, not financial, tax or legal advice. SMSF decisions should involve your licensed financial adviser and accountant; we arrange the credit side alongside them. Rules current at 18 August 2026.
