Bob has his $1.85m farmland in his SMSF and $150,000 in cash (from renting the farm land to the business).
The Government decides to rezone the area residential, and his land is now worth $5 million.
He has no earnings on the cash, no contributions, no withdrawals but his earnings are $3 million ($5 million – $2 million)
The proportion earning calculation is ($5m – $3m) / $5m or 2/5th
So, the tax payable is 15% x $3 million x 2/5 = $180,000
But the fund only has cash of $150,000 so he needs to find another $30k
But as farming has been tough, he can’t get the $30k so he has to sell the family farm…
This is what happens when you tax unrealized gains…
TaxRambling.com 
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