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You’ve found the place. Maybe it’s a weatherboard in Preston with a lemon tree out back, or a neat little townhouse near the Maribyrnong River that’s been living in your saved searches for months. Then a question pops up, usually late at night, usually after talking to an accountant, a parent, or a friend who ‘did it this way’:
‘Should we buy it in the family trust?’
Buying property in trust can make sense for some people. It can also turn into a stressful mess if the paperwork and timing don’t match the way Melbourne property is actually bought, especially at auction where there’s no pause button.
Let’s walk through what it really means to buy in trust in Victoria, where people trip up, and what you can do to make the process smoother.
What does ‘buying in trust’ actually mean?
A trust isn’t a separate legal person. It can’t sign a contract or hold title in its own name.
So when people say ‘the trust is buying’, what they mean is the trustee is buying the property for the benefit of the trust’s beneficiaries.
That trustee might be:
An individual (for example, ‘Jane Citizen as trustee for the Citizen Family Trust’), or
A company (for example, ‘Citizen Holdings Pty Ltd ACN … as trustee for the Citizen Family Trust’)
On the contract and on the certificate of title, you’ll see the trustee’s name. The trust relationship sits behind it.
That sounds simple. In conveyancing, the details matter more than you’d expect.
Why Melbourne buyers choose a trust (and what a conveyancer can, and can’t, do)
People usually look at trusts for a few familiar reasons:
Long term asset planning (thinking ahead to kids, future ownership, or business risk)
Tax planning (where an accountant is guiding the strategy)
Privacy and administration (keeping personal ownership separate from other dealings)
Shared ownership arrangements (especially where multiple family members are contributing)
A quick note on roles: a conveyancer helps you buy property safely, correctly, and in line with Victorian conveyancing practice. We’ll raise risks, structure the contract properly, and make sure settlement can happen. We don’t replace tailored tax advice, so it’s wise to have your accountant involved early if tax is part of the reason you’re using a trust.
The trust types that come up most often in Melbourne purchases
You don’t need to become a trust expert to buy property, yet it helps to know the flavour of trust you’re dealing with because the rules and risks can shift.
Family discretionary trusts
This is the classic ‘family trust’ setup, where the trustee has discretion about distributing income or capital among a class of beneficiaries.
These are common, and they’re also the ones that cause time pressure at purchase time. They often have broad beneficiary clauses, which can create duty issues in Victoria if not handled properly (more on that soon).
Unit trusts
Here, beneficiaries hold ‘units’, similar to shares. Unit trusts pop up in investment groups, developments, and business related property.
Fixed trusts and bare trusts
A bare trust is often used as a ‘holding’ arrangement where the beneficial owner is clear from day one. It’s also a structure you’ll hear about with certain lending arrangements.
Self managed super funds
Buying property through a self managed super fund has its own set of rules. If there’s borrowing involved, a separate holding trustee arrangement is often needed and the paperwork has to be right from the start.
The big Melbourne trap: auction day and ‘we’ll fix the trust bit later’
This is the scenario we see again and again.
You’re heading to an auction in the inner north. You’ve got your limit, your partner is trying to look calm, the agent is floating around with a clipboard, and you’re thinking about nothing except the next bid.
If you win, you sign the contract straight away.
If the contract is signed in your personal name, swapping the purchaser over to a trustee later can be difficult, expensive, or simply not possible without the vendor’s agreement. It can also create a duty problem, because changing who is really buying can be treated as a new transaction in its own right.
So the golden rule is simple:
If you want to buy in trust, have the trust ready before you bid or sign.
‘Ready’ usually means:
The trust deed is signed and dated
The trustee is in place (and if it’s a company, it exists and is correctly set up)
The person signing has authority to sign for the trustee
The name you plan to use is agreed and consistent across documents
Getting the purchaser name right: it’s not just a spelling issue
In Victorian conveyancing, the purchaser details aren’t a casual field you can tidy up later. Lenders, the duty process, and land registration rely on those details.
Individual trustee
If an individual is the trustee, the contract often needs to show capacity clearly, such as ‘as trustee for’ the relevant trust.
Corporate trustee
If a company is trustee, we usually want:
The full company name
The ACN
Trustee capacity wording (again, ‘as trustee for’)
We also check who will sign and whether a director’s signature is enough or whether trustee minutes or a resolution are needed (this varies depending on how the trust and company are set up).
A small mismatch can become a big delay at settlement, when everyone is tired, the bank is chasing, and you’d rather be measuring the lounge room.
Duty and trusts in Victoria: what you should be thinking about early
Duty (stamp duty) is often the first thing people ask about when a trust is involved, and for good reason.
Here are the key ideas to keep in mind.
Declarations of trust can attract duty
In Victoria, a declaration of trust over land can be dutiable. This is one reason we’re careful when someone wants to ‘sign now and sort the trust later’. If what happens later is treated as a trust declaration over dutiable property, duty can arise.
Changes in beneficial ownership can trigger duty
Duty can apply where there’s a transaction that changes the beneficial ownership of land. In plain terms, if the real economic ownership shifts, the State Revenue Office may treat it as dutiable.
That’s why the structure and timing matter. It’s also why we get a bit twitchy when we hear ‘we’ll just nominate the trust later’ without checking what the contract allows.
Foreign purchaser additional duty and discretionary trusts
This one catches Melbourne buyers by surprise, even buyers who are Australian citizens and have lived here for years.
In Victoria, discretionary trusts can be treated as ‘foreign’ for foreign purchaser additional duty if the trust deed allows for a potential foreign beneficiary. Wide beneficiary clauses can create that risk.
Many trust deeds now include an express exclusion clause to prevent foreign persons being beneficiaries, yet older deeds may not. The timing matters too, because any amendment that’s needed must be done before settlement for the purchase in question.
If you’re buying through a family discretionary trust, it’s worth having your trust deed checked early, not the week before settlement when you’ve got removalists booked.
Land tax: trusts can be assessed differently
A lot of buyers focus on the purchase and forget the ongoing holding costs.
Victoria has land tax rules that treat trusts differently to individuals. Many trusts can be subject to a trust surchargeonce the total taxable land held in the trust reaches a relatively low threshold.
Owner occupiers also assume their home is always land tax free. With trusts, it can be more complex. Some trusts can access relief in certain scenarios, and trustees of discretionary trusts or unit trust schemes may be able to nominate a principal place of residence beneficiary for concessionary treatment rather than a full exemption.
The takeaway isn’t ‘don’t buy in trust’. It’s ‘know the ongoing rules before you commit’.
Finance and buying in trust: expect extra questions from the bank
If you’re borrowing, the lender will usually want more than they would for a straightforward personal purchase.
Common requests include:
A copy of the trust deed (and any variations)
Trustee details (including company documents if relevant)
Identification documents for directors and sometimes beneficiaries
Trustee minutes or a borrowing resolution
Personal guarantees in some cases
This can affect timing, especially if you’re trying to buy quickly in a competitive part of Melbourne where vendors expect clean offers and short finance periods.
A practical tip: if you’re planning a trust purchase, talk to your broker or lender before you’re deep into Saturday inspections. Getting a ‘yes’ in principle is one thing. Getting formal approval with trust documents is another.
Off the plan and trust purchases: the long gap creates its own risks
Melbourne has plenty of off the plan stock, from apartments closer to the CBD through to townhouse developments further out. Off the plan contracts often have long settlement periods, which can tempt people to think the trust structure can be sorted later.
Be careful.
Over time, trustees change, trust deeds get varied, companies get replaced, and family plans shift. Some changes can have duty implications, especially if a change is seen as affecting beneficial ownership.
If you’re buying off the plan in trust, it’s smart to:
Ensure the trust and trustee are correct at signing
Keep the trust deed and trustee structure stable unless you’ve taken advice
Tell your conveyancer early if anything changes, even if it feels ‘internal’
Common mistakes we see (and how to avoid them)
‘The trust doesn’t exist yet, we’ll set it up after we win’
If the trust isn’t established at contract time, you may have no clean way to put the property into that trust without creating a new transaction.
Fix: set up the trust and trustee before you offer or bid.
Signing in your own name ‘to keep it simple’
It can feel easier in the moment. It can also be costly later.
Fix: get the purchaser details right on the contract from the start.
Using the wrong trustee name or missing the trustee capacity
This can cause settlement delays and registration issues.
Fix: provide your conveyancer and the agent with the exact trustee name, plus ACN if it’s a company, and the trust name.
Ignoring foreign beneficiary issues in a discretionary trust deed
This can create unexpected additional duty exposure.
Fix: have the trust deed reviewed early, especially if it’s an older family trust.
Forgetting land tax and ongoing holding costs
A trust can be a long term structure. Land tax is a long term cost.
Fix: consider land tax treatment as part of the purchase decision, not an afterthought.
A quick ‘before you sign’ guide for trust buyers in Melbourne
If you want a smoother purchase, aim to have these ready before you step into an auction crowd or send an offer email from a tram stop:
Trust deed signed and dated
Trustee confirmed (individual or company)
If corporate trustee: company details and ACN handy
Signing authority clear (who signs and in what capacity)
Trust deed checked for foreign beneficiary wording if it’s a discretionary trust
Lender or broker told you’re buying in trust, with documents ready to provide
Conveyancer lined up to review the Section 32 and contract conditions early
It’s a small amount of work up front that can save a lot of stress later.
When to bring a conveyancer in (spoiler: earlier than most people do)
If you’re buying in trust, the best time to involve your conveyancer is before you sign, not after. That’s true for private sales, and it’s even more true for auctions where you’re committed the moment the hammer falls.
We can:
Review the Section 32 and contract with the trust purchase in mind
Confirm the purchaser details and signing requirements
Flag duty and land tax issues that commonly arise with trusts
Help you avoid a last minute scramble with the agent, the bank, and settlement deadlines
Ready to buy in trust? Let’s make sure it’s set up properly
If you’re considering buying property in trust in Melbourne, we’re happy to help you get the details right before you commit. Contact Pearson Chambers Conveyancing for guidance and a complimentary Section 32 contract review, so you can bid or sign with more confidence and fewer surprises.