How Non-Arm's Length Income Applies to SMSF Property

Quick Answer

Non-arm's length income (NALI) for SMSFs refers to income from transactions not conducted at market value, often resulting in higher tax rates. Under section 295-550 of the ITAA 1997, NALI can lead to income being taxed at 45%, rather than the concessional 15% rate, impacting the SMSF's overall tax efficiency.