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Ownership Structures

Protect your assets and optimise your tax position with expert guidance on the right ownership structure for your property portfolio.

Why Ownership Structure Matters

The ownership structure you use for your property portfolio is one of the most consequential decisions you will make as an investor or developer. It determines how your income is taxed, how your capital gains are treated, what asset protection you have, how easily you can distribute wealth to family members, and what happens to your assets when you die.

Most investors choose their structure at the start based on what is simplest or most familiar — often individual or joint ownership. While these work for some situations, they frequently create problems as portfolios grow: higher marginal tax rates, limited asset protection, and estate planning complications that are expensive to unwind later.

At Property Tax Specialists, we advise clients on the full range of structures available in Australia, helping you choose the approach that best fits your current circumstances and long-term goals.

Structures We Give Tax Advise On

Individual and Joint Ownership

Direct personal ownership is the simplest approach and provides access to the full 50% CGT discount for assets held longer than 12 months. However, rental income is taxed at your marginal rate, and your personal assets are directly exposed to any claims arising from the property. Joint ownership with a spouse or partner can allow income splitting to a limited degree, but the ownership proportions are fixed.

Trusts (Family Trusts)

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Companies

A company structure provides the benefit of the flat corporate tax rate, which is lower than the top marginal personal income tax rate. Companies also provide strong liability protection. However, companies do not access the 50% CGT discount available to individuals and trusts, which is a significant disadvantage for long-term investment properties. Companies are more commonly used for development projects or trading activities than for passive property investment.

Self-Managed Superannuation Funds (SMSFs)

Purchasing property inside an SMSF can deliver significant tax advantages. Rental income is taxed at 15% in accumulation phase and is tax-free in pension phase. Capital gains on assets held for more than 12 months are taxed at 10% in accumulation phase and are tax-free in pension phase. However, SMSF property investment comes with strict rules around related parties, borrowing arrangements, and the separation of personal and fund assets. Specialist advice is essential.

See also: SMSF Accounting — propertytaxspecialists.com.au/property-tax-services/smsf-accounting/

Hybrid and Layered Structures

For larger portfolios, a layered or hybrid structure — for example, a discretionary trust with a corporate trustee that also owns units in a separate unit trust — can provide the optimal combination of tax efficiency, asset protection, and estate planning flexibility. These structures require careful design and ongoing management but can deliver significant long-term benefits for the right investor.

State-Based Considerations

Ownership structures also have significant implications under state-based land tax regimes, which vary considerably between NSW, Victoria, Queensland, South Australia, and other states. Some structures attract surcharges or lose access to tax-free thresholds that would otherwise apply. We take state-based land tax into account as part of every structuring recommendation.

For overseas nationals and Australian expats, additional considerations apply including foreign purchaser duty surcharges and land tax surcharges, which differ by state.

See also: International Investors — propertytaxspecialists.com.au/locations/international-investors/ | Australian Expats — propertytaxspecialists.com.au/locations/australian-expats/

Reviewing an Existing Structure

If your portfolio has grown since you established your current structure, or if your personal circumstances have changed, it may be time to review whether your existing approach still serves you well. We regularly advise clients who are restructuring an existing portfolio — helping them understand the costs and benefits of changing arrangements, including stamp duty, CGT, and any CGT rollover concessions that may apply.

Our Approach

Ownership structure advice is not a one-size-fits-all exercise. We take time to understand your full financial position, your goals, your family situation, and your risk tolerance before making a recommendation. We explain the trade-offs clearly so you can make an informed decision.

Call 1800 800 829 or book a consultation at propertytaxspecialists.com.au to discuss your ownership structure.