The ATO is allowing SMSF trustees additional time until 31 January 2017 to ensure that any limited recourse borrowing arrangements (LRBAs) that their fund has are on terms consistent with an arm’s length dealing, or alternatively are brought to an end.
This extension is due to requests following the release of the Practical Compliance Guidelines 2016/5 in April this year. The guidelines detailed information about the “Safe Harbours”, in which further assistance and examples are needed.
The ATO had previously advised SMSF trustees they only had until 30 June 2016 to review the LRBAs in their fund.
As part of this extension, the ATO has advised that it will provide further information and illustrative examples, to assist SMSF trustees and advisers to make decisions about relevant arrangements, by 30 September 2016.
