News : LRBA

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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Insurance, LRBA, Property, SMSF

LRBA insurance payments not linear

LRBA Life insurance SMSF Business real property

SMSFs holding life insurance to cover liabilities from an LRBA should be aware any benefits from the policy may not actually be applied to the arrangement.

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Legislation, LRBA, SMSF, Tax

LRBA ban key to Greens Div 296 vote

SMSF LRBA Division 296 Australian Greens

The Greens are calling for restrictions on the use of LRBAs by SMSFs as a condition for the party’s support for the Division 296 bill before parliament.

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LRBA, Property, Trusts

LRBA bare trust transfer needless

Bare trust LRBA SMSF Property

Properties acquired using an LRBA need not automatically be transferred from a bare trust into an SMSF once the loan has been paid back.

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AAT, ATO, LRBA, SMSF

SMSF lending ruling not a model to adopt

SMSF AAT ATO Private lending NALI non-arm’s length income BPFN

The ATO has warned an Administrative Appeals Tribunal ruling regarding private lending in an SMSF should not be taken as a model to apply to other arrangements.

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Administration, Investments, LRBA, SMSF

Legacy LRBAs forgotten by lenders

LRBA SMSF Refinancing Legacy LRBAs Lending Loans

LRBAs from banks and lenders who have exited the SMSF space are most likely being under-serviced and advisers and accountants should be encouraging clients to review them to gain the best interest rates available.

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Compliance, LRBA, Trusts

LRBAs not good for vacant land

Single acquirable asset Vacant land LRBA Unit trust

SMSF trustees could face a compliance issue should they use an LRBA to purchase vacant land through their fund.

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LRBA, SMSF

Asset transfer after LRBA optional

SMSF LRBA limited recourse borrowing arrangement bare trust transfer

SMSFs do not have to transfer an asset from a bare trust after paying off an LRBA, but not doing so will constrain its use by the fund.

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LRBA, Regulation, SMSF

Beware LRBA interest rate impact

Interest rates LRBA SMSF Loans Related-party

SMSF practitioners should assess their clients’ existing LRBAs and explore opportunities to secure a better interest rate for the loan through a commercial lender.

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