Labor’s tax deal with the Greens will close a superannuation ‘loophole’. What is changing and who is affected? (opens original article in a new tab)

The Australian Labor government has passed tax reforms banning self-managed super funds (SMSFs) from borrowing to invest in residential property, as part of a deal with the Greens to secure Senate approval. The changes, effective for new investments, aim to reduce financial risks in the superannuation system and address concerns about housing market affordability, though critics argue it may impact property supply.

• The Australian Labor government has banned self-managed super funds (SMSFs) from borrowing to invest in residential property as part of a tax reform deal with the Greens.
• The changes apply to new investments 45 days after royal assent and will raise about $50m over four years, with no impact on existing arrangements.
• The reforms aim to reduce risk in the superannuation system and address concerns about SMSFs driving up housing prices, though critics argue it may reduce property market supply.
• The 2007 exception allowing SMSFs to use limited recourse borrowing arrangements for residential property will be narrowed to commercial property only.