What is attracting the attention of the ATO? Fund Loans!

The ATO Commissioner has noted that loans by SMSFs are of particular concern.  Fund loans account for 30% of current audit cases and prohibited loans (eg to members or relatives) are the “single biggest” contravention reported by fund auditors.

The Commissioner has noted that 500 funds had indicated in their annual returns that over 80% of their assets were constituted by loans.  The ATO is currently following up these funds to ensure that the loans were properly documented, on arms length terms, and were not with prohibited parties.