Structure
Trust, company, SMSF or own name?
A practical comparison across land tax, CGT, asset protection, borrowing capacity and ongoing compliance.
Ownership structure is the single decision most investors get wrong before they even see a property. It is reversible — but only at the cost of stamp duty, CGT and legal fees. Get it right early and you compound the benefit across every property that follows.
The four common options, side by side
| Own name | Discretionary trust | Company | SMSF (LRBA) | |
|---|---|---|---|---|
| Land tax | Threshold per state | Often no threshold (state-dependent) | Flat, no threshold | Concessional, depends on fund |
| CGT discount | 50% (12m+) | 50% flows through | 0% | 33.3% (12m+) |
| Asset protection | Low | High | High | Very high (super) |
| Borrowing capacity | Strongest | Limited (servicing) | Limited | Restricted to LRBA terms |
| Setup + ongoing cost | $0 / very low | $1.5–3k + annual | $1k + annual | $2–4k + audit |
| Best fit | First property, PAYG buyer | Multi-property, family wealth | Trading + holding combo | Long-hold retirement asset |
The trade no one talks about: borrowing capacity
Trusts and companies look great on tax. They often look terrible on serviceability — because lenders haircut distributions and apply shading on directors’ guarantees. The “best” structure on paper can stop your portfolio at property two.
Same borrower, same income — borrowing capacity by structure
$ borrowing capacity, indicative
The right structure is the one that lets you buy the next property, not the one that wins on a single tax line.
How we sequence it
- Property 1–2: usually own name or joint, to preserve maximum borrowing capacity.
- Property 3+: trust often becomes attractive once land-tax thresholds and asset protection start mattering more than servicing.
- SMSF: only when the long-term retirement plan justifies the compliance load — and the fund is genuinely growth-stage, not last-minute.
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