Foreign exchange involves the trading or simple exchange of currencies internationally. An SMSF is permitted to engage in this form of investment. Please be mindful that all investments of the SMSF should be in the name of the SMSF.
The ATO provides a list of exchange rates that we use for accounting purposes. You can refer to the rates here. If your SMSF has overseas assets, please use the nearest actual exchange rate at year end. If your SMSF has overseas income, please use the average rate at year end.
You may be interested in investing in the foreign exchange market if you speculate a particular currency will increase in value. If a currency is bought at a lower rate and sold at a higher rate, the SMSF can profit from the trade.
The risks involved in trading with foreign exchange should be understood. Some of the risks are:
It is important to ensure that foreign exchange is allowed in your SMSF’s investment strategy. The investment strategy specifically allows this. You can access our investment strategy here.
Alternative to trading, your SMSF may engage in foreign exchange if you intend to purchase assets overseas and you require funds in another currency.
If you would like assistance with international transfers, you may consider using TorFX. They can assist with transactions such as:
Click here to see more information on what TorFX can offer.