The ATO has made a determination – Self Managed Superannuation Funds (COVID 19 Rental income deferrals – In house Asset Exclusion) Determination 2020 (legislation.gov.au) – to ensure that trustees of SMSFs do not inadvertently breach the “in-house asset rules” 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.

Read more about this determination here.

If you have any questions or would like to speak to one of our professional business and tax advisors, please contact our office on (08) 9392 7600 to make a booking.

With three offices across Western Australia and over 20 years of experience, Muntz Partners is a dynamic team of highly trained and skilled individuals committed to providing innovative and effective advice, excellent service and maintaining only the highest standards in ethical professional practice.