In this guide
As approximately 10% of self-managed superannuation funds (SMSFs) have used limited recourse borrowing arrangements (LRBA) to purchase assets, it’s likely a significant number may have taken advantage of COVID-19 repayment relief offered by lenders.
Even if the repayment relief has ended, trustees need to understand and document what was offered, especially if the loan was from a related party.
For more on LRBAs and how they work see SuperGuide article What are the SMSF borrowing rules?
What relief is available?
During COVID-19 and the subsequent lockdowns, some trustees with LRBAs may have faced cash flow issues and difficulty meeting loan repayments for a variety of reasons. They may have offered rent relief to a tenant of a property asset; they could have experienced reduced income due to COVID-19 market volatility; or they may just have seen superannuation contributions to the fund fall if a member lost their job.
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