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.

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