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The ownership structure you choose when buying a property can have significant implications for your tax bill and your overall financial situation. Trusts are becoming an increasingly popular ownership structure for property investors because of the tax benefits, asset protection and estate planning advantages they offer. While this may sound effective, not many actually use a trust structure when they buy a property.


What is Trust and How Does It Work?

Trust is an ownership structure where the legal owner is not the beneficial or eventual owner. It allows a person or company owns an asset on behalf of someone else and thus creates a separation between the owner of the asset and those who will gain the benefit of the asset.

The two most popular trust structures that are commonly used by property investors are appointing a trustee of family discretionary trust and appointing a corporate trustee.


Corporate Trustee

Trustee of Family Discretionary Trusts

·         A corporate trustee is a company that acts as trustee of a trust.

·         The company is a registered company, much like any other company, but it is often incorporated with the sole purpose of acting as trustee.

·         The directors of the corporate trustee who control the trustee (the company) and consequently control the distributions of the trust. 

·         There is no requirement of transfer of assets if a Director of a company dies or resigns.

·         Directors of corporate trustee can be beneficiaries in their individual capacity of a trust whilst still being in control of the same trust.

·         Corporate trustee ensures that the assets of the trust are managed by all the directors and not by one individual like that in case of an individual trustee.

·         All the assets of the trust are legally held in the name of the corporate and not individual which thereby provides a protection of the assets in a trust.

·         Usually set up to hold a family’s assets.

·         Trustee can use their discretion to distribute the trust’s income and assets to the beneficiaries, allowing the family members to take advantage of tax benefits.

·         If a current individual trustee dies or resigns, all the assets of the trust (including the trust deed) need to be transferred from the name of the old individual trustee to the name of the new individual trustee.


What are the Advantages of Holding a Property in Trusts?

A trust structure increases the chances that the asset will not form part of an individual’s asset in the event of legal or creditor action. Other than it could possibly save some taxes on investments, it also gives flexibility of distributing both income and capital gains to a group of people at the discretion of the trustee. Under a trust structure, income and any capital gains belong to the trust and the trust has to distribute them based on the terms of the trust deed.

If you would like to inquire about Holding Your Property in Trust or find out more about your rights and options, Straits Lawyers are here to help. Simply send us an email at or give us a call on 8410 9069 to arrange an appointment for an online interview.


Alternatively, if you would like purchase or sell a property, Straits Lawyers are now offering online conveyancing services. To access these services, simply click on the link –



Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.