Technical Bulletin:

Rent and loan relief
guidelines for commercial properties

• Sole Purpose Test

• Provision of financial assistance to members or relatives of members

• In-house asset rules

Audit Commentary

What are the Guidelines?

https://www.pm.gov.au/sites/default/files/files/national-cabinet-mandatory-code-ofconduct-sme-commercial-leasing-principles.pdf

Step One - Tenant Approach

Warning:

Step Two - Applying Relief

Example
Bob and Mary Smith are members and trustees of their SMSF. The SMSF owns the building where Bob and Mary operate a café in the CBD. Their monthly rent is $5,000 and they have seen a reduction in turnover of 80% due to only being able to offer takeaway meals and less people working in the city. As part of their application for relief to the SMSF they would be entitled to rent relief of $4,000 per month (80%).

At least $2,000 of this must be waived and $2,000 deferred over the remaining term (or 24 months). The landlord can waive more than 50% but they cannot seek reimbursement of the amount waived, and there would need to be further justification for the SMSF to offer more than the 50% waiver. Without justification this would raise immediate sole purpose and financial assistance flags.

Step Three - Document on Decisions

• request from the tenant requesting relief and confirming the reduced turnover

• trustee resolutions acknowledging the request and outlining the agreed terms

• confirmation from the SMSF to the tenant confirming the proposed relief

Warning –

Investment via Related Entities

Limited Recourse Borrowing Arrangements

Residential Property

Dealing with unrelated parties

here