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ARTICLE · 14 MARCH 2012

SMSFs and the traps in the PPSA regime

Cooper Grace Ward
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Owners of personal property and collectables in the possession of others must register their interests on the PPSR.

AustraliaFinance and Banking
Scott Hay-Bartlem
Scott Hay-Bartlem
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The new Personal Property Security Act (PPSA) started on 30 January 2012.

This regime alters some of our established concepts of ownership. Owners of personal property like plant and equipment, motor vehicles, stock, artwork and collectables in the possession of others must now generally register their interest on the Personal Property Security Register (PPSR) or risk losing their title.

Three areas where this has a potentially serious impact, particularly for trustees of SMSFs, are where the trustees:

  1. lease personal property to another;
  2. place goods with another on consignment for sale; and
  3. have goods in storage.

While all entities with those arrangements need to be aware of the new registration requirements, trustees of SMSFs must also consider the compliance consequences of failing to register, particularly where the other party to the arrangement is a related entity.

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