Concerns about the NALE rules as they currently stand and the associated penalties are now being expressed by the entire superannuation industry.

Three key principles put forward by the superannuation industry could produce a positive outcome in dealing with non-arm’s-length expenditure provisions.

Discussions regarding the enforcement of the NALE rules from 1 July 2022 onwards are continuing, with 13 industry bodies presenting a united voice.

Several potential changes to the non-arm’s-length expenditure rules can be identified based on the recommendations put forward by industry stakeholders.

Pending changes to contribution rules being considered by the ATO could factor in a fix for the problems with the NALE provisions presented by the superannuation industry.

A resolution to industry concerns around NALE has taken too long and raises questions as to the aims of the provisions.

The consensus among a panel of SMSF specialists is for fund trustees to apply an ultra-conservative approach to the NALE rules.