r/AusProperty • u/Other_Method_7679 • 3d ago

Investing Trust vs Personal Name

/r/AusPropertyChat/comments/1x6g62d/trust_vs_personal_name/

Myself and my partner are looking to buy our first investment property. 32F and 34M. Borrowing capacity up to $1.3m with approval up to $600k currently.

We want to build a portfolio and invest in 2 hopefully 3+ if all goes well over the next couple of years using equity to purchase.

We can’t decide whether setting up a trust for our first property is the best way to go, or whether we should do personal first and trust later. Appreciate there are costs and extra paperwork involved if we do.

Any advice would be very appreciated!

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u/jokuda-au 2d ago

Trusts are mostly about asset protection and control, not tax savings on the first purchase. A discretionary trust usually can't pass negative gearing losses out to you, so the losses stay in the trust until it has income to use them against. Lenders are also pickier with trusts, and moving a property into one later can trigger CGT and stamp duty. If you're fairly sure you'll want a trust down the track, it's usually cleaner to set it up before you buy.