Buying an Investment Property: Own Name, Trust, Company or SMSF?

The decision that follows a property investor the longest is not which property to buy, but whose name goes on the contract. Own name, discretionary trust, company or self-managed super fund (SMSF) each produce a genuinely different tax and legal outcome, and unwinding the wrong choice later usually means paying stamp duty and capital gains tax that a moment of planning would have avoided. There is no single right answer, only the right answer for your income, your state, your family and your risk. Here is how the four options actually compare.

Negative gearing: only useful where you have income to offset

Negative gearing lets a net rental loss reduce your other taxable income, but that only works if the owner has other income to reduce. Held in your own name, a loss offsets your salary directly. Held in a discretionary trust, the loss is trapped: a trustee can distribute income to beneficiaries but not losses, so a loss can only be carried forward against the trust's own future income. A company has the same problem in a different form, with losses carried forward inside the company subject to loss recoupment tests and never reaching your personal return. An SMSF is already taxed at a flat concessional rate, so a loss simply reduces the fund's own taxable income, not your salary, and since 10 August 2026 a new SMSF loan can only be used to buy business real property, not a residential rental, under the Treasury Laws Amendment (Tax Reform No. 1) Act 2026; existing residential SMSF loans are grandfathered. See our SMSF borrowing changes article for detail. From 1 July 2027, negative gearing on established homes bought after 12 May 2026 is quarantined further still; our guide to that reform covers it in full. The equation can flip once a property turns positively geared: a company or SMSF taxed at a flat 30%, 25% or 15% rate can then work out cheaper than your marginal rate, which is one reason a structure decision is worth revisiting as a portfolio matures rather than set once and forgotten.

The CGT discount: not every structure qualifies

Individuals and trusts that hold a property for at least 12 months can access the 50% CGT discount. Complying super funds, including SMSFs, get a 33.33% discount instead, or potentially none at all on gains realised in pension phase. Companies get no CGT discount whatsoever: the full gain is taxable, and rental income counts as base rate entity passive income, so a company holding mainly rental property will usually fail the 80% passive-income test for the lower company tax rate and pay tax at the full 30% rate instead of 25%.

Land tax: state rules can outweigh everything else

Land tax is a state tax, and trust treatment varies significantly by state. In NSW, a standard discretionary trust is classified as a special trust under the Land Tax Management Act 1956 (NSW), which means no tax-free threshold at all: tax applies from the first dollar at 1.6%, rising to 2% above the premium threshold, unless the deed meets specific criteria to instead be treated as a fixed trust. Held in your own name, the same property benefits from the general threshold, $1,075,000 for the 2026 land tax year, before any land tax applies. A company also gets the threshold in its own right, but related companies under common control are grouped and share a single threshold between them, so splitting a portfolio across separate companies does not multiply it. Other states apply their own thresholds and trust surcharges, sometimes just as harshly, so check the relevant state revenue office before assuming NSW rules carry over.

Asset protection has a cost, not just a benefit

Holding property through a trust or company keeps it out of your personal name, which matters if you carry personal liability risk as a company director or in an exposed profession. But lenders routinely require personal guarantees from the individuals behind a trust or company, which erodes that protection at the point it matters most. An SMSF offers strong protection from personal creditors, but the property must satisfy the sole purpose test: no living in it, no renting it to family, and breaching the fund's rules can be costly to unwind.

Getting the decision right before you sign

The right structure depends on your income, your other assets, the state the property sits in, your family situation, and now the 2027 and 2028 reform dates. At Finance & Tax Consultants we model each option against your actual numbers before you sign, not after. If you are weighing up your next purchase, our property investor services page covers how we approach structuring across a whole portfolio, or see our guide to tax advice before you buy for the pre-purchase checklist.

Disclaimer: This article contains general information only and does not constitute financial, legal or tax advice. It has been prepared without regard to your objectives, financial situation or needs. Tax and superannuation laws change frequently, and the information in this article may not reflect the current law or may become inaccurate over time. Before acting on anything in this article, you should consider its appropriateness to your circumstances and seek advice from a registered tax agent or qualified adviser.