This type of Trust was introduced to satisfy the requirements of sections 67 A&B of the Superannuation Industry Supervision Act 1993. A Bare Trust used for Limited Recourse Borrowing Arrangements (LRBA) is established to allow an SMSF to borrow money for an asset. AATs include a number of provisions which address the requirements of the Act - that the Trustee:
- is only permitted to hold one asset on trust (under each Trust arrangement),
- must account to the Trustee of the Superannuation Fund for any income received from the Trust asset; and
- must in the Deed be required to transfer the asset to the Trustee of the Superannuation Fund if requested once the loan has been repaid.
A lending entity is prohibited from having recourse to any asset of the Superannuation Fund other than the asset held in trust by the Trustee of the AAT.