A potential federal budget measure granting retirees an exemption to the $1.6 million transfer balance cap and $1.6 million total super balance rules for downsizing by selling the family home has been backed by the SMSF Association.

Treasury’s last minute proposal to count assets under a limited recourse borrowing arrangement (LRBA) towards an individual’s super balance and transfer balance cap will leave financial advisers exposed to risk if legislated.

The federal government’s next exposure draft legislation, which will determine whether assets held under a limited recourse borrowing arrangement (LRBA) will be counted towards an individual’s total superannuation balance and transfer balance cap, is creating nervousness across the industry because it could result in more complex issues to work through.