ATO warns against breaching rules in SMSF transactions
The Tax Commissioner of the Australian Taxation Office (ATO), Michael D’Ascenzo, has warned self-managed superannuation fund (SMSF) trustees to be wary of people offering to set up arrangements between funds and related parties to purchase assets, saying certain arrangements may breach in-house asset rules.
“These arrangements use a paid third party to set up an agreement, sometimes referred to as ‘a joint venture agreement’, between the fund and related trust to purchase an asset that provides income for the trust and the fund,” D’Ascenzo said.
“This is clearly an attempt to circumvent the in-house asset rules, as the transaction is really an investment by the SMSF in the related trust,” he said.
The ATO is looking closely at SMSFs to make sure they are meeting their obligations concerning loans, in-house assets, borrowings and non-arms length transactions, D’Ascenzo said.
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