Key Highlights

  • The trust deed must allow in-specie transfers.
  • The transfer must pay a member's benefit and be valued at market value.
  • Collectables sold to a related party need a written independent valuation.

Selling every asset to close a fund is not always attractive. Property can take months to sell, and some members would rather keep a share portfolio than see it sold and repurchased. Transferring an asset to a member in specie, meaning in its existing form rather than as cash, can look like an easy answer. It can work, but it comes with deed, valuation and related-party considerations that trustees should understand first.

This is evergreen guidance drawn from the ATO's wind-up page (updated 2 April 2025), its guide to valuing SMSF assets (updated 15 May 2026), its auditor guidance for winding-up funds and its in-house asset page.

Start with the trust deed and a benefit entitlement

The ATO's wind-up page says trustees should check the trust deed for whether assets can be transferred to members instead of sold. That is the gateway question: if the deed does not allow in-specie transfers, they are not available. The ATO also expects the transfer to be a way of paying a member's benefit, so it needs to be supported by the member meeting a condition of release or by the benefit otherwise being payable. A rollover to another fund is generally a cash movement, and the ATO's wind-up guidance says that where a condition of release has not been met, benefits must be rolled over to another complying fund.

Valuation is central

The ATO's valuation guide says trustees must value all fund assets at market value when preparing accounts and statements. Market value is the price a willing buyer could reasonably expect to pay a willing seller, assuming arm's-length dealing. A valuation must be fair and reasonable: based on objective, supportable data, made in good faith through a rational process and explainable to a third party. The guide says trustees should value assets at the transaction date where relevant.

The auditor guidance for winding-up funds says asset disposals should be at market value, with verifiable evidence from trustees. It singles out collectables: where collectables are sold to a related party, including as an in-specie super payment, the auditor confirms there is a written valuation from a qualified independent valuer.

The valuation guide adds more detail. A qualified independent valuer is legally required only for certain collectables and personal use assets disposed of to a related party: for assets acquired on or after 1 July 2011, and for assets acquired before that date and disposed of after 30 June 2016. For other assets, the guide recommends an independent valuation when the asset is a significant part of the fund or the valuation is complex.

Evidence differs by asset type

For listed securities, the ATO guide points to the closing price on the approved exchange. For widely held trusts and managed funds, it points to the published exit price. For real property, it lists comparable sales, recent arm's-length purchase prices, independent agent appraisals and other items, and says relying on a single item is generally insufficient. For unlisted securities and unit trusts, trustees should document how value was substantiated; signed audited financial statements that value assets at cost are unlikely to be sufficient alone.

Related-party rules

The ATO's valuation guide says acquisitions from related parties are prohibited, with exceptions such as listed securities, business real property and certain in-house assets, and permitted acquisitions must be at market value. Investments must also be made and maintained at arm's length. These rules matter when a fund is open; they influence how a fund's assets came to be held and whether any past breach exists.

The ATO's in-house asset page explains that from 1 July 2009, some investments with related parties or related trusts acquired before 11 August 1999 are treated as in-house assets if the fund reinvests earnings, makes additional investments or pays up partly paid shares or units. It also refers to the 5 per cent in-house asset limit. Trustees whose funds hold related-party investments should check these rules before deciding how to deal with those assets on closure.

Tax and duty

The ATO's wind-up page tells trustees to consider capital gains tax and stamp duty when disposing of assets. An in-specie transfer is still a disposal by the fund, and state or territory duty may apply depending on the asset and the jurisdiction. Trustees should get tax and legal advice on the specific asset. This article does not state any specific duty outcome.

Documentation

The ATO asks trustees to document sale decisions, valuation methods, and, for each sale, the buyer, date and amount. For an in-specie transfer, the equivalent record would include the member's entitlement, the deed clause relied on, the valuation and evidence, the date of transfer, the title transfer or registry change, and the trustees' minute.

Hypothetical example

Imagine a member with a benefit of a certain amount who wishes to receive a listed share holding. The trustees would check the deed, confirm a condition of release, value the shares using the closing price, record the transfer and update the member's balance. The same steps for a painting would need an independent valuation. This is hypothetical and not advice.

Takeaway

In-specie transfers are possible only where the deed allows them, a benefit is payable and the valuation is robust. Collectables and related-party dealings deserve extra care. Trustees should document everything and seek tax and legal advice before relying on this route.