The bill reintroduces an employer shortfall exemption certificate for high-income earners with multiple employers, a measure to include the outstanding value of limited recourse borrowing arrangements (LRBAs) in the total super balance (TSB) for certain SMSF members, and also extends the existing non-arm’s length income (NALI) rules to capture non-arm’s length expenses.

The TSB measure for LRBAs will apply to LRBAs that were commenced on or after 1 July 2018. The increase only applies to members who have satisfied a relevant condition of release with a nil cashing restriction or those with a related-party loan.

The NALI amendments will extend the non-arm’s length income rules so that they apply in situations where a super fund incurs non-arm’s length expenses in gaining or producing an income.

In an online update, the ATO said the proposed measures will impact the reporting of LRBAs and non-arm’s length income for some SMSFs for the 2018–19 financial year and onwards, once they receive royal assent.

However, the ATO has informed SMSFs that, until the bill receives royal assent, they should continue to report information as instructed in the existing 2019 SMSF annual return instructions.

“We will update our web content and relevant instructions when the bill becomes law,” the ATO stated.