The SMSF owns units in the pre 99 unit trust. The trust sold recently all assets and the only assets it has, are loans to the related parties (7 millions) and only libilities are the loans from related parties (3 millions), the loans are increasing and some decreasing. The loan agreements have been provided and the interest is calculated.
Is this allowed to have the pre 99 unit trust, just with the related party (lets say they arm's lengh) loans?
I think those grandfathered loans had a 10 year maximum period (but really not sure because it's a fairly obscure rule).
I'd suggest you chat to your accountant to know for sure, because there are other conditions that apply to those loans.
I think those grandfathered loans had a 10 year maximum period (but really not sure because it's a fairly obscure rule).
I'd suggest you chat to your accountant to know for sure, because there are other conditions that apply to those loans.
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