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Resources on demand

NALI, NALE and SMSFs – the ATO draws a new line in the sand with LCR 2021/2

There has been a lot of discussion about how non-arm’s length income (NALI) and non-arm’s length expenditure (NALE) apply to self-managed superannuation funds as result of the draft ruling issued by the ATO in 2018 (LCR 2018/D10) and the revised version issued in 2019 (LCR 2019/D3).

Now, after three years of uncertainty, the ATO has issued their final ruling (LCR 2021/2) in relation to the application of the NALI and NALE rules.

With the current focus of the ATO and auditors on NALI and NALE, it is more important than ever to be on top of the ATO’s new position and the NALI and NALE rules more broadly. We find the impact of the NALI and NALE rules on SMSFs is often misunderstood and underestimated – the extra tax payable can be large and out of proportion to what has occurred.

In this webinar, we will go over the wideranging implications of the ATO’s position in LCR 2021/2 and:

  • when the NALI and NALE rules apply to SMSFs
  • the treatment of non-arm’s length general and specific expenses
  • services provided by the trustee/director/member
  • common situations we see where NALI and NALE will apply
  • what steps to take to ensure your SMSFs do not have NALI and NALE