#9658
Awan Hammad
Participant

    Hi Maria

    Thanks.

    I have not come across a property being purchased overseas by a SMSF with a borrowing (LRBA).

    My view is that I would expect that the trustees would have obtained legal advice to support that the LRBA has been set up to comply with SIS.

    An LRBA can be set up with a corporate trustee for the SMSF and the property can be in the name of an individual or individuals where they are holding the property in trust for the SMSF (via a bare / custody trust).

    As the auditor you would need to request a copy of the loan agreement to see if this will meet the requirements of SIS (refer SIS section 67A). As an example you will need to be able to review that the rights of the lender are:

    “are limited to rights relating to the acquirable asset”.

    Thanks

    SMSF AAA

    LOGIN

    New to this site? Sign Up

    We have upgraded our website for a better experience.

    Because of this upgrade, all members need to change their password to access their account by clicking the Forgot Password button below.

    Thank you and we look forward to your continued support!