SMSF Loans and Bare Trusts
The Superannuation Industry (Supervision) Act 1993 states, an SMSF can borrow funds to acquire certain types of properties. A Bare Trust deed is used to ensure the proper arrangements are in place for the Super Fund to borrow funds for the acquisition of assets.
In simplified, terms a Limited Recourse Borrowing Arrangement using a Bare Trust structure is set in place to facilitate the purchase of a property using borrowed funds.
Please see our Limited Recourse Borrowing Arrangement page for further details on Bare Trusts & LRBAs. Click here
Related Links
ATO – Limited Recourse Borrowing Arrangements.
The information provided is of general nature only and should not be relied upon without seeking legal & financial opinion. We strongly recommend the trustees of super funds obtain independent legal and financial advice as to whether the acquisition of an investment under a limited recourse borrowing arrangement is an appropriate investment for a fund.
