New ATO Exposure Draft on SMSF Borrowing

ATO Page

On the face of it this appears to be welcome news for those that have properties on bare trust.

I must admit I was surprised to see this as if limited recourse borrowing is going to be banned why even bother going to the effort of releasing new rules - unless the intent is to just retrospectively make what has already been practiced in the past acceptable (ie ignoring the bare trust for income tax purposes).

Comment from DBA Lawyers
The intent is to fix the problems of the past and grandfather these trusts if a ban occurs. Like a pre-99 unit trust.

The ATO have loads of rulings that are outdated but not withdrawn. And many areas where rulings have been requested and not been issued.