I have a server running on my local network that acts as a router for the computers in my network. I want to achieve now that outgoing TCP requests to certain IP addresses are tunnelled through an SSH connection, without giving the people from my network the possibility to use that SSH tunnel to connect to arbitrary hosts.

The approach I had in mind until now was to have an instance of redsocks listening on localhost and to redirect all outgoing requests to the IP addresses I want to divert to that redsocks instance. I added the following iptables rule:

iptables -t nat -A PREROUTING -p tcp -d 1.2.3.4 -j DNAT --to-destination 127.0.0.1:12345

Apparently, the Linux kernel considers packets coming from a non-127.0.0.0/8 address to an 127.0.0.0/8 address as “Martian packets” and drops them. What worked, though, was to have redsocks listen on eth0 instead of lo and then have iptables DNAT the packets to the eth0 address instead (or using a REDIRECT rule). The problem about this is that then every computer on my network can use the redsocks instance to connect to every host on the internet, but I want to limit its usage to a certain set of IP addresses only.

Is there any way to make iptables DNAT packets to 127.0.0.1? Otherwise, does anyone have an idea how I could achieve my goal without opening up the tunnel to everyone?

Update: I have also tried to change the source of the packets, without any success:

iptables -t nat -A POSTROUTING -p tcp -s 192.168.1.0/24 -d 1.2.3.4 -j SNAT --to-source 127.0.0.1
iptables -t nat -A POSTROUTING -p tcp -s 192.168.1.0/24 -d 127.0.0.1 -j SNAT --to-source 127.0.0.1