The SMSF Association has welcomed the ATO coronavirus-related financial relief measure regarding rent reduction granted by trustees to the tenants of a property owned by their fund, even in cases where the occupier is a related party.
“The association approached the ATO about its view on rental concessions for the 2019/20 and 2020/21 financial years immediately after the enormity of these public health and economic crises became apparent, so it’s pleasing to note the regulator will offer this significant temporary relief measure that we believe will help many SMSF members who are small business owners,” SMSF Association chief executive John Maroney said.
“In these unprecedented times, we believed there was a strong argument for rental concessions to be part of the package of revised commercial arrangements and that these should be extended to SMSFs and their small businesses.”
Maroney said the situation of not knowing how these circumstances would be viewed by the regulator was causing stress for many small business tenants, who due to the COVID-19 trading restrictions could no longer afford to pay their rent.
“The ATO’s decision provides much-welcomed financial relief and certainty for the SMSF sector that is also dealing with the impact of market volatility on investment portfolios,” he said.
The industry body also backed the federal government’s $130-billion JobSeeker payment initiative as an additional coronavirus relief measure to combat financial hardship experienced by small business owners, many of whom are SMSF trustees.
“The $130-billion package, the third assistance tranche announced by the federal government, is critical to keep businesses afloat during a public health crisis that is having massive economic repercussions,” Maroney said.
“It not only throws a much-needed lifeline to the many small to medium-sized enterprises that have seen their revenue dry up in recent weeks, but it will help retain links between employers and employees during these dire times that will be essential to ensure business recovers as quickly as possible once COVID-19 is under control.”