The calculation of an individual’s total superannuation balance (TSB) will now include, in certain circumstances, the outstanding LRBA amount attributable to each member’s interest where the fund has an LRBA that was made under a contract entered into on or after 1 July 2018.
This will apply if:
- the LRBA is with an associate of the SMSF — in this case all members of the fund whose interest is supported by the asset purchased with the LRBA must include their portion of the outstanding balance of the LRBA amount in their TSB calculation
- a member of the fund met a condition of release with a nil cashing restriction — in this case, the member must include the outstanding LRBA amount attributable to their super interest in their TSB calculation.
This change doesn’t include the refinancing of an LRBA that was made under a contract entered into before 1 July 2018, where both the following apply:
- the new borrowing is secured by the same asset or assets as the old borrowing
- the refinanced amount is the same or less than the existing LRBA.
The change is spelt out in Treasury Laws Amendment (2018 Superannuation Measures No. 1) Bill 2019, which has now become law, with an effective date of 1 July 2018.