A Bare Trust is only set up if you need to take out a loan (from the bank or you can act as the bank for the SMSF). The bare trust will only be set up once you have identified the property the SMSF would purchase.
Setting up a bare trust is a quick process, and we can have it set up in a few hours. The Bare Trust makes specific references to the property, and you will need to supply us with the following information before we can set up the bare trust – please copy paste and email the following details to us:
Bare Trust information
Property details:
Address
Lot Number
County
Parish
Title Reference
Plan Reference
Bank Details:
Who is the lender?
Lender Company Name and ACN
Lender company’s address
Loan Information:
Total purchase price, loan amount, term of the loan in years, settlement date
Please email this data to us and the email address is:
Changes to Limited Recourse Borrowing Arrangements (LRBAs) for Residential Properties
The ATO has announced changes to the LRBA rules for self-managed super funds (SMSFs). From 10 August 2026, SMSFs will only be able to use an LRBA to purchase business real property. New LRBAs can no longer be used to acquire residential properties.
These changes apply only to borrowing arrangements entered into on or after 10 August 2026. If an SMSF entered into a binding contract to purchase a property before that date, the new rules will not apply, even if the LRBA is established or settlement takes place after 10 August 2026. Existing LRBAs under these arrangements can also continue to be maintained or refinanced.
The new rules apply regardless of the lender, including banks, non-bank lenders, and related-party lenders.
Importantly, LRBAs have not been abolished. SMSFs can still use them to acquire business real property and to maintain or refinance eligible existing borrowing arrangements.
The ATO provides further information on these changes here.
Tax Consequences of having a Bare Trust in an SMSF
A Bare Trust is disregarded for tax purposes. As the SMSF is absolutely entitled to the underlying asset, the ATO’s look-through treatment applies. Consequently, no separate tax return is required for the Bare Trust, and all income, expenses, and capital gains are reported directly in the SMSF’s annual return.