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SMSF borrowing restrictions

The limited circumstances where your self-managed super fund (SMSF) can borrow money.

Last updated 1 April 2025

Media: SMSF – Borrowing and limited recourse borrowing arrangements
https://tv.ato.gov.au/ato-tv/media?v=bd1bdiubfs46ehExternal Link (Duration: 2:20)

Paying a member benefit that is due

Your SMSF can borrow money for a maximum of 90 days to meet benefit payments due to members.

The amount you borrow can't exceed 10% of your SMSF's total assets.

Meeting an outstanding contribution surcharge liability

Your SMSF can borrow money for a maximum of 90 days to meet an outstanding superannuation surcharge liability.

The amount you borrow can't exceed 10% of your SMSF's total assets.

Covering the settlement of security transactions

Your SMSF can borrow money for a maximum of 7 days to cover the settlement of security transactions if:

  • at the time you entered the transaction, it was likely you did not need to borrow money
  • the amount you borrow doesn’t exceed 10% of your fund's total assets.

Limited recourse borrowing arrangements

Your SMSF can use a limited recourse borrowing arrangement (LRBA) to fund the purchase of a:

  • single asset
  • collection of identical assets that have the same market value.

The asset is held in a separate trust outside of the SMSF. This keeps the other assets of the SMSF protected if the loan defaults.

How to set up limited recourse borrowing arrangements, and the different superannuation laws and rules that apply.

QC42461