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ATO issues SMSF warning
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| Michael D'Ascenzo
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The Australian Taxation Office (ATO) has issued another warning to self-managed superannuation fund (SMSF) trustees regarding related party transactions, particularly with respect to property.
The taxation commissioner, Michael D’Ascenzo, said the ATO was concerned about arrangements being offered to trustees that breached the 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 a related trust to purchase an asset that provides incomes for the trust and the fund,” he said.
D’Ascenzo said such arrangements were clearly an attempt to circumvent the in-house asset rules, as the transaction was really an investment by the SMSF in the related trust.
The tax commissioner said SMSF trustees needed to be aware that the ATO was closely monitoring SMSFs to ensure they met their obligations in relation to loans, in-house assets, borrowings and non-arms length transactions.
AUTHOR
Mike Taylor
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