From www.smsfadviser.com: The recent Federal Court decision in the Merchant case emphasizes that SMSF advisers must be vigilant, as transactions that seem ordinary can still face ATO scrutiny if additional facts warrant concern.

The court found that the sale of BBG shares from a related party to the Gordon Merchant Superannuation Fund was primarily conducted to crystallize a capital loss, attracting tax benefit implications under Part IVA of the Income Tax Assessment Act.

Although the trustee’s disqualification was later set aside due to mitigating factors, significant tax consequences remain for the involved entities.