SMSFs Leasing Commercial Property to Related Parties

What to do when a tenant experiences financial distress due to Covid-19.

Trustees of SMSFs that own a commercial property which is leased to a related party (such as the business of one or all of the members), may be concerned about the ability of the tenant to continue paying rent through the Covid-19 economic downturn. 

Normally when a related party tenant is struggling to pay their rent, the SMSF trustees must follow the terms of the lease or risk breaching the superannuation laws or being subject to extra tax.