SMSF related party rental income deferrals due to COVID‑19
The ATO has made a determination to ensure that trustees of SMSFs do not inadvertently breach the ‘in-house asset rules’.
This applies to a situation where the fund allows a related party to defer the payment of rent under a lease agreement (on arm’s length terms) because of the financial impact of COVID‑19.
Where the requirements of the determination are met, the deferral of rent will not be treated as a “loan” or “financial accommodation” to the related party in either or both of the 2019/20 or 2020/21 income years.
The determination also applies where an SMSF owns interests in a “non-geared” company or unit trust that allows a tenant to defer the payment of rent under a lease (on arm’s length terms) because of the financial impact of COVID‑19.
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