Delays for new LRBA guidance ahead of deadline
The release of guidance for the new LRBA rules, which trustees are expected to be compliant with by June 30 this year, has been delayed.
The ATO issued ATO ID 2014/39 and ATO ID 2014/40 in December 2014. Both decisions confirm that borrowings on non-commercial terms can cause non-arm’s length income (NALI).
In October last year, the ATO confirmed it expects trustees to have these arrangements on commercial terms by 30 June this year.
The industry is awaiting guidance on what is considered commercial terms, after an ATO-formed working group put forward some parameters to the regulator.
This guidance was scheduled to be released today, however an ATO spokesperson told SMSF Adviser it will now be released on April 6.
The guidance will be published as a ‘Practical Compliance Guideline’, according to the ATO.
“Practical Compliance Guidelines are a new ATO public advice product and, to allow the guidelines to be published in this more formalised manner, as a Practical Compliance Guideline, publication of the LRBA guidelines in this form will now occur on 6 April,” the spokesperson said.