SPR 2020/D1 determination under paragraph 71(1) (f) for the consultation.

ATO has issued SPR 2020/D1 determination under paragraph 71(1) (f) for the consultation.

I have been in discussions with the ATO for some time now and very glad to see this determination now open for comments

This determination is the Superannuation Industry (Supervision) In-house Asset Determination – Intermediary Limited Recourse Borrowing Arrangement Determination 2020.

This sets guidelines around non-standard SMSF property loans where lender has not provided limited resource.

In recent past when major lenders withdrew from SMSF property lending market, I have seen some structure those have not fit well for in-house asset exception provided under 67A.

Lodging ACR for these structures have been very challenging where client obtained professional financial advice and lawyers were involved.

This determination has provided clarity and more seeds for the thought. Which will certainly open doors for the SMSF to obtain compliant loan, provided they have lender to meet conditions set out.

Whether “normal residential loans with lower interest rates” which some claim, meet the terms, will require more clarification. 

Some already set up loans will not be complaint given item 9 of determination reads “the documentation referred to in paragraph (8) is disclosed to the lender in connection to the borrowing referred to in paragraph (5).

I have seen trustees providing declaration to the lender that “this loan is not for the superannuation fund”.

Due date to provide comments to the ATO is 13 March 2020.



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SPAA Specialist Auditor

SPAA Specialist Auditor

Shiv Parihar is a SMSFA accredited SMSF Specialist Auditor™. He provides SMSF auditing services independently, conflict free and in accordance with professional audit standards.

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