News : LRBA

Education, LRBA, SMSF, Superannuation

LRBA rate gap a driver for change

The growing gap between the safe harbour interest rate for an LRBA and those on offer from commercial lenders may push some SMSFs to seek new borrowing arrangements.

The growing gap between the safe harbour interest rates for an LRBA and those on offer from commercial lenders may push some SMSFs to seek new borrowing arrangements.

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LRBA

LRBA and release conditions warning

The combination of certain conditions of release and an LRBA may close off an SMSF to future contributions.

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LRBA

Refinanced LRBA usage limited

LRBA, SIS Act, Heffron, Leigh Mansell, 

SMSFs using a refinanced LRBA for costs unrelated to the loan will breach the very narrow borrowing provisions that apply to these arrangements.

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LRBA, NALI/NALE

Revised LCR maintains stance on LRBAs

Self-managed superannuation SMSF Law Companion Ruling LCR 2021/2DC NALE non-arm’s-length expenditure LRBA limited recourse borrowing arrangement DBA Lawyers Fraser Stead

The changes to the operation of the NALE rules have not flowed through to LRBAs, with the ATO’s revised guidance seeing non-arm’s-length dealings as tainting the arrangement forever.

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Auditing, LRBA, NALI/NALE

Non-commercial LRBAs too risky for auditors

Related-party NALI non-arm's length income LRBA Limited recourse borrowing arrangement Auditor

Related-party LRBAs without evidence proving they are on commercial terms are unlikely to receive approval from SMSF auditors due to NALI risk.

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LRBA, Property

LRBA housing market impact overstated

LRBA Limited recourse borrowing arrangement SMSF Association Property

Data has been presented to a parliamentary committee showing the effect LRBA use has had on Australia’s housing market has been exaggerated.

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LRBA, Trusts

Single LRBA can acquire several assets

LRBA 13.22C Property Self-managed superannuation SMSF

An LRBA can be used to acquire multiple properties for a development project, but this approach may raise additional compliance risks.

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LRBA, Property

No LRBA changes for property upgrades

Limited recourse borrowing arrangements LRBA Self-managed superannuation SMSF capital improvements rental properties petition Jim Chalmers

The government will not change the existing rules on using limited recourse borrowing arrangements to allow for energy-efficient improvements on rental properties.

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LRBA

Marginal rise for safe harbour rates

LRBA Related-party loans Interest rates

The safe harbour interest rates for related-party loans under an LRBA have increased slightly for the next financial year, avoiding the sharp rise of 12 months ago.

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Legislation, LRBA, SMSFA, Tax

SMSFA staunchly defends LRBAs

SMSF LRBA Division 296 tax SMSF Association Greens

The ability for SMSFs to use limited recourse borrowing arrangements has been defended amid renewed calls from some politicians to ban them.

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