#9679
Awan Hammad
Participant

    Hi Dawood

    I have not seen this before or seen a promissory note held by a SMSF.

    If anyone has experience in this issue please advise the forum.

    As a starting point a SMSF could lend money to an unrelated party being a builder and the loan would not have to be paid if this is replaced by the Fund instead receiving an asset being the completed property.

    This would need to be done on a commercial / arm’s length arrangement to comply with section 109 of SIS.

    Yes my view is that it would be commercial for the SMSF to take security over the property in relation to the loan to the builder. I would need to see the whole of the agreement re the promissory note to be able to comment on it.

    Thanks

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