The four common ways investors hold property

Most Australian investors end up choosing between four ownership structures. None is “best” in the abstract — the right answer depends on your income, your other assets, your family situation, your borrowing plans and your long-term intentions. Below is a plain-English sketch of what each one is associated with, so you can have a more informed conversation with your accountant or adviser. Read it as background, not as a recommendation.

1. In your own personal name

The simplest and most common route. You are on the title, you borrow in your own name, and any rental income and capital gain flow to you personally. It is cheap to set up and easy for lenders to assess. The usual trade-offs people discuss are that the asset sits in your personal estate (so it is exposed if you are ever sued or become insolvent), that income cannot be split with anyone else, and that land tax is assessed against you as an individual. How land tax actually applies — and the thresholds — differ by state and change over time, which is exactly why this belongs with your adviser.

2. Through a company

Here a company holds the property and you own the shares. Companies are sometimes used for a degree of separation between the asset and the individuals, and income is taxed at the company rate rather than your marginal rate. The commonly cited downsides are that companies generally do not get the individual capital gains tax discount, and that land tax and stamp duty can be treated differently again. Companies are more often seen in commercial holdings than in a straightforward residential investment.

3. In a discretionary or unit trust

Buying property in a trust means a trustee holds the property for the benefit of the trust’s beneficiaries. A discretionary (family) trust gives the trustee flexibility over who receives income each year; a unit trust divides the benefit into fixed units, which suits unrelated investors going in together. Trusts are frequently discussed for asset protection and for flexibility in how income is distributed, and for estate-planning reasons. The trade-offs people weigh include how the trust can borrow (lenders scrutinise trust structures closely and usually want personal guarantees), and the fact that land tax treatment of trusts varies significantly between states. Whether any of this actually helps you is a question of tax and structuring advice.

4. Inside a self-managed super fund (SMSF)

An SMSF can buy investment property as part of the fund’s retirement strategy, with income and gains taxed in the concessional super environment. This is the most heavily regulated of the four options. The fund must comply with superannuation law, the property has to meet the fund’s investment strategy and sole-purpose test, and where the fund borrows there are strict rules about how it is structured. If you are considering this path, our SMSF conveyancing page explains how it works — but the threshold question of whether an SMSF purchase is right for you sits squarely with your accountant or licensed adviser.

Why the structure decision belongs with your accountant or adviser

Notice a pattern above: almost every trade-off — asset protection, income splitting, the CGT discount, land tax, borrowing capacity — is a tax, financial or superannuation question. That is deliberate. Corporate Legal provides legal and conveyancing services only. We do not give tax, financial, superannuation or investment advice, and we do not tell you which structure to choose or quote you land-tax thresholds. Those calls should be made with your accountant or a licensed financial adviser who knows your full position.

What we do is work alongside that adviser. Once the structure is decided, we make it real: we confirm the correct legal entity, prepare or review the contract in that entity’s name, set up and document the trust or custodian arrangements where needed, and make sure everything is compliant and in place before you commit. Think of it as a division of labour — your adviser decides the what and the why; your lawyer makes sure the how is executed correctly.

The legal point that matters most: get the entity right before you exchange

Here is where a structuring conversation becomes a legal one. Stamp duty is generally assessed on the transfer of the property to the buyer named on the contract. If you sign in the wrong name and later try to move the property into the entity you actually intended — your trust, your company, your SMSF’s custodian — that later transfer can be treated as a second dutiable transaction. In plain terms: you can end up paying stamp duty twice on the same property. On a typical investment purchase that is a very expensive mistake to fix.

A related trap is the casual use of “and/or nominee” on a contract. Buyers — and sometimes agents — treat it as a harmless way to keep options open about who ends up on the title. It is not harmless. Depending on the state and how it is used, nominating a different buyer later can be treated as a sub-sale and attract its own duty, or it can fail to achieve what you assumed it would. It is not a substitute for deciding the entity up front.

The clean solution is unglamorous but reliable: decide the structure, have the entity in existence, and put the correct name on the contract before exchange. That means the trust deed executed and (where required) stamped, the trustee company registered, or the SMSF’s bare trust in place — ready to go before contracts are signed. Retrofitting the structure afterwards is where the double-duty and compliance problems live.

SMSF purchases have their own strict rules

If your adviser recommends buying through an SMSF, the structuring work is more involved and the timing is less forgiving. Where the fund borrows, it must do so under a limited recourse borrowing arrangement (LRBA), and the property has to be held by a separate bare trust (a custodian trust) until the loan is repaid. That custodian arrangement has to be established correctly — and, crucially, in place before the fund exchanges — or the fund can face duty and compliance problems. We set these up as part of our SMSF bare trust and custodian setup service.

As with every other structure, whether an SMSF purchase suits your retirement strategy is a financial decision for your accountant or licensed adviser — not something we advise on. Our role is to make sure the legal structure and paperwork are correct and compliant.

How the four structures compare at a glance

This table is a high-level orientation only, to frame your conversation with your adviser. It is general information, it is not advice, and it does not account for your circumstances or the current rules in your state.

What your lawyer actually does

Once you and your adviser have landed on a structure, this is where we come in. On any investment purchase we will:

• Confirm the exact legal entity that should be named as buyer, and check it exists and is ready before exchange.
• Review the contract of sale — or the whole conveyance — so the entity, special conditions and timing all line up. See contract reviews and conveyancing.
• Set up and document trust or SMSF custodian arrangements correctly, in the right sequence, so the structure holds.
• Flag “and/or nominee” and naming issues before they become a double-duty problem.
• Settle electronically on PEXA, with a qualified property lawyer — not just a conveyancer — on the file the whole way through.

Getting a lawyer involved before you exchange is the single most valuable thing you can do here. After exchange, your options narrow and the fixes get expensive. Before exchange, the name on the contract is just a decision — and one we can make sure is right.

This article is general information only, current as at July 2026, and is not legal, financial, taxation or investment advice. Property law, stamp duty and thresholds differ between states and change over time. You should obtain advice specific to your circumstances before acting. Corporate Legal provides legal and conveyancing services only.