SMSFs cannot directly invest in India due to regulations set by the Indian government. To explore investment opportunities in India through a Self-Managed Superannuation Fund (SMSF), trustees need to be recognized as Overseas Citizens of India.
For those interested in Indian investments, trustees must obtain Indian Tax Identifier numbers, known as PAN (similar to the Australian TFN), and establish Non-Resident External Bank accounts.
For example, if thinking about investing in Indian Mutual Funds, trustees should:
When purchasing and holding mutual fund units, trustees should use their individual names and include a declaration of trust, giving full authority to the SMSF.
This process is similar to acquiring real estate in India. It’s important to know that any profits made will be taxed in India. However, both after-tax profits and invested capital can be freely transferred back to Australia. Trustees should confidently fulfill all investing and tax responsibilities in India related to their SMSF investments.
In India, separate bank and portfolio accounts will be maintained in the trustees’ names for easy tracking and accounting of SMSF investments. The declaration of trust is crucial in this process.
Remember, the advice on this page is general. It’s highly recommended to seek professional advice from us before making any decisions based on the information provided here.