The Ruling states that the prohibition and exceptions in s 67 only apply to borrowings of money. Therefore, for the purposes of section 67, a borrowing is an arrangement that exhibits two necessary characteristics (see para 10):
- a temporary transfer of an amount of money from one entity (the lender) to another (the borrower); and
- an obligation or an intention on the part of the borrower to repay that amount to the lender (which may be satisfied by the provision of an asset).
- bona fide contributions to SMSFs that are accepted and dealt with in accordance with the Superannuation Industry (Supervision) Regulations 1994 (SISR);
- the liability of an SMSF to pay benefits to members as they fall due;
- arrangements under which expenses are paid on behalf of the SMSF trustee by an agent or any other person where reimbursement is immediately sought from and made by the SMSF; and
- normal commercial delays in the payment of expenses incurred by an SMSF trustee.