Employing an LRBA in an SMSF should not lead to any of the fund members having a negative asset balance.

The place of outstanding balances of intermediary LRBAs in regards to an SMSF’s total super balance remains unclear as the sector awaits further ATO input.

Transactions arising from limited recourse borrowing arrangements are unlikely to trigger a transfer balance account reporting event.

Changes to LRBA regulations have opened the door to the creation of master funds with more than one borrowing arrangement.

The ATO has outlined the conditions under which it will offer administrative relief for SMSFs with LRBAs where a Division 7A loan is in place.

SMSF advisers and trustees have been warned about the complex nature of using back-to-back loans as an LRBA strategy.

Limited recourse borrowing arrangements have held their ground within the portfolios of SMSFs, but are still less than 1 per cent of all residential property assets.