Collection goes on block

RECENT changes to superannuation laws have forced Melbourne art dealer Bill Nuttall and his wife, Annette Reeves, to part with their cherished Aboriginal art collection.

By InvestSMART · 20 Apr 2012

By InvestSMART ·
20 Apr 2012

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RECENT changes to superannuation laws have forced Melbourne art dealer Bill Nuttall and his wife, Annette Reeves, to part with their cherished Aboriginal art collection.

The recent Cooper Review into superannuation has created strict new laws for people with art in super funds. Whereas in the past super fund art could be stored (but not displayed) at home, collectors must now store it externally.

Faced with the prospect of having to bury away the 120 Aboriginal works he and his wife collected as part of their super fund over the past 20 years, Nuttall decided he'd rather sell.

"We collected these works because we loved them . . . so we have chosen to offer them for sale in the hope that others will enjoy them," Nuttall says.

The collection, estimated to be worth as much as $697,000, will be shown at Nuttall's Niagara Galleries in Melbourne from May 13 to May 20 before being auctioned by Bonhams in Sydney on May 28.

Melbourne accountant Tom Lowenstein, who campaigned against the new laws, yesterday said they were clearly creating a disincentive for people to buy art as part of their super fund.

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Frequently Asked Questions about this Article…

How have recent superannuation law changes affected people who hold art in their super funds?

The article explains that changes from the Cooper Review introduced stricter superannuation laws that affect art held in self-managed super funds. Where art could previously be stored at home (but not displayed), collectors must now store works externally — a change that has forced some owners to sell rather than hide or relocate their collections.

What specific storage rules for art in super funds did the article describe?

According to the article, under the new rules artworks held in a super fund can no longer be kept at home (even if not displayed) and must be stored externally. This requirement was a key reason collectors considered selling pieces rather than moving them into external storage.

Why did Melbourne art dealer Bill Nuttall decide to sell his Aboriginal art collection?

Bill Nuttall and his wife chose to sell their Aboriginal art collection because the new superannuation rules would have forced them to 'bury away' 120 works they collected over 20 years by putting them into external storage. Nuttall said they collected the works because they loved them and preferred to offer them for sale so others could enjoy them.

How large is the Nuttall collection and what is its estimated value?

The collection contains about 120 Aboriginal works amassed over roughly 20 years, and the article estimates the collection could be worth as much as $697,000.

When and where will the Aboriginal art collection be exhibited and auctioned?

The collection will be shown at Niagara Galleries in Melbourne from May 13 to May 20, and then it will be auctioned by Bonhams in Sydney on May 28, as reported in the article.

What role does Bonhams play in the sale of the collection?

The article states that Bonhams, the auction house, will conduct the auction of the Nuttall collection in Sydney on May 28.

Are there concerns that the new superannuation art rules will discourage investing in art through super funds?

Yes. The article cites Melbourne accountant Tom Lowenstein, who campaigned against the new laws and said they were clearly creating a disincentive for people to buy art as part of their super funds.

What should everyday investors take away from this story about art in superannuation?

The article highlights that regulatory changes to superannuation can materially change how art investments are held and managed — in this case prompting a long-time collector to sell. Everyday investors with art or alternative assets in super funds should be aware that rule changes (like external storage requirements) can affect the practicality and costs of holding these assets.