• A1 and A2 Interest expenses within Australia

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    Did the SMSF incur interest expenses on money borrowed from an Australian source (such as an Australian bank)?

    No

    Leave A1 and A2 blank. Go to B1 and B2.

    Yes

    Read on.

    Write at A1 and A2, as required, the amount of interest that the SMSF incurred in 2014–15 on money borrowed from an Australian source.

    Deductible interest expenses within Australia

    Write at A1 the amount of deductible interest expenses incurred on borrowings from sources within Australia.

    For example, interest expenses incurred on borrowings are deductible to the extent the borrowed money is used to:

    • acquire assets for the purpose of earning assessable income
    • finance operations for the purpose of earning assessable income, or
    • meet current expenses incurred for the purpose of earning assessable income.

    Do not include at A1 interest expenses (or any part of such expenses) that relate to earning:

    If the SMSF paid an income stream (pension) to a member, refer to Self-managed super funds and tax exemptions on pension assets before you claim a deduction for the SMSF's interest expenses incurred on borrowings from Australian sources.

    Non-deductible interest expenses within Australia

    Write at A2 the amount of interest expenses that the SMSF incurred on borrowings from Australian sources that is not deductible. This includes an amount of interest expense to the extent it is incurred for the purposes of earning exempt income.

    Last modified: 15 Jan 2016QC 44344