Blog · Property investment
The myth
“If I want to buy an investment property, it has to go in my own name.”
The reality
You can buy an investment property in your own name, jointly with someone else, through a company, through a family trust, or through your self managed super fund. Each option comes with different tax, land tax, asset protection and lending considerations.
Many people default to their own name simply because they don’t know there are other choices. For business owners especially, the right structure can make a real difference over the life of the investment. The best time to decide is before you buy, because changing it later can trigger stamp duty and capital gains tax.
Your main ownership options
In your own name or jointly. This is the simplest option and has the widest choice of lenders. Traditionally, tax losses from negative gearing could be offset against your personal income. However, the negative gearing rules have changed, so how they apply to you may depend on when you buy and the type of property you buy. Check the latest rules with your accountant before you commit.
Through a family trust. A trust can offer flexibility in how income is distributed and some asset protection. However, losses generally stay inside the trust rather than reducing your personal tax.
Through a company. A company pays tax at the company rate and can suit some business owners’ broader plans. Companies generally don’t get the capital gains tax discount that individuals and trusts can.
Through your SMSF. Your super fund can buy an investment property, including with a loan, but strict rules apply about how the property is bought, used and managed. You can’t live in it or rent it to a relative.
How lenders view each structure
The structure you choose also changes how the loan works.
| Structure | What to expect from lenders |
|---|---|
| Own name or joint | The widest range of lenders and products, and usually the simplest process |
| Family trust | Fewer lenders, more paperwork such as the trust deed, and directors or trustees usually give personal guarantees |
| Company | Similar to trusts, with personal guarantees from directors usually required |
| SMSF | Specialist lenders only, larger deposits, and the property is held in a separate holding trust |
Lending to trusts and companies is an area where policies vary a lot between lenders. Some are comfortable with it and some will avoid it entirely, which is where an experienced broker earns their keep.
What to weigh up
There’s no single right answer. The best structure depends on your goals, your income, your family situation and your existing assets. A few things to think about:
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- Tax. Do you want any losses to reduce your personal tax now, or are you thinking about how income and gains are shared later?
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- Land tax. In Queensland, land tax thresholds and rates can differ for individuals, companies and trusts.
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- Asset protection. If you run a business, keeping investments separate from your personal name can be worth considering.
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- Borrowing. Some structures narrow your choice of lenders or add cost and complexity.
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- Your long term plans. Think about how you might want to sell, pass on or add to the property in future.
This is where your accountant’s advice is essential. We work alongside accountants regularly to make sure the lending matches the structure they recommend.
Practical tips before you buy
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- Speak to your accountant about structure before you sign a contract.
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- If you’re using a trust or company, have it set up and its documents ready before you apply.
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- Make sure the name on the contract matches the borrowing entity.
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- Ask your broker which lenders are comfortable with your chosen structure.
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- If you’re using equity in your home, plan how the loans will be split between you and the entity.
The bottom line
Buying in your own name is just one option. Trusts, companies and SMSFs can all hold investment property, and for many business owners one of them may suit better. Each comes with trade offs, so getting the right advice before you buy is the most important step.
At Write Finance, we regularly help clients borrow through trusts, companies and SMSFs, and we’ll work with your accountant to get the lending right from the start.
Frequently asked questions
Can I buy an investment property through a family trust?
Yes. Many lenders will lend to a family trust, usually with personal guarantees from the trustees or directors. You’ll need to provide the trust deed and related documents.
Can a company buy an investment property in Australia?
Yes. A company can own investment property and borrow to buy it, though fewer lenders offer this and directors usually need to give personal guarantees.
Can I buy an investment property with my SMSF?
Yes, provided your fund meets the rules. Loans are available through specialist lenders and usually need a larger deposit than a standard investment loan.
Is it better to buy an investment property in my name or a trust?
It depends on your income, tax position, asset protection needs and long term plans. Your accountant is the best person to advise on this.
Can I transfer an investment property into a trust later?
It’s possible, but it can trigger stamp duty and capital gains tax. That’s why it’s best to decide on the structure before you buy.
Download the free Ownership Structures Guide
Compare your options before you buy. Our free guide explains how each ownership structure works and how lenders view it, includes a checklist to work through, and lists the questions to take to your accountant.
Planning your next investment?
If you’re weighing up whose name your next property should go in, have a chat with our team. We’ll show you how each structure affects your borrowing and work with your accountant to get it right.
This article is general information only and does not take into account your objectives, financial situation or needs. Lending criteria, rates and fees vary between lenders and are subject to change. Speak with your accountant about tax and structuring, and talk to us about your lending options before acting.
