SMSF Association submission on Non-Arm’s Length Income (NALI) and Expenditure (NALE) – LCR 2019/D3 and PCG 2019/D6

26 November 2019

The SMSF Association welcomes the opportunity to provide a submission on LCR 2019/D3. We are generally supportive of the Australian Taxation Office’s (ATO) efforts to provide some guidance on the operations of the non-arm’s length expenditure (NALE) provisions, in particular to clarify the distinction between personal and trustee services as best possible.

However, we believe that further clarifications are necessary due to the disproportionate outcome related to typical trustee services which are of a general nature and the significant tax liabilities that may occur when the ATO treat all fund income and future capital gains as non-arm’s length income (NALI) due to a minor discount on a loss, outgoing or expense.

 

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