Using A Family Trust To Purchase Investment Property Using a family trust as an ownership structure means that you won’t be the investment property’s legal owner but rather the beneficial owner. This means that the trustee (which can be an individual or a company entity) will own the investment property on your behalf.

Can a trustee buy property from the trust?

The answer to the question of “self-dealing” depends upon the terms of the trust. There will be a section in the trust agreement titled “Power of Trustee” or something to this effect. This section could possibly grant the trustee the power to purchase trust property as long as she is paying fair market value.

What are the benefits of buying property in a trust?

In the case of a property, a trust structure increases the chances that the asset will not form part of a person’s asset base in the event of legal or creditor action. It also gives the flexibility of distributing both income and capital gains to a group of people at the discretion of the trustee.

Can a personal representative or trustee buy estate property?

An express authority in the will or trust instrument will be effective as it will be implied authority – given the fact that the testator or settlor placed the executor or trustee in a position of conflict of interest. If you are a personal representative or trustee and you wish to purchase estate or trust property then you should:

What can a real estate trust be used for?

A real estate trust is widely used as a tool to disguise owner names, help with estate planning or allow a group of people to invest in a property without getting taxed differently.

When to buy a real estate trust or LLC?

When buying an investment property, you have the option of purchasing it in your own name or under another entity name, such as a real estate trust or a limited liability company (LLC). The reasons to do the latter mainly revolve around your desire for anonymity or liability protection.

Can a trustee be both seller and buyer?

Newey, J emphasised that the self-dealing rule is based not only upon the principle that a trustee cannot be both seller and buyer, but also upon the wider principle that a trustee must not put themselves in a position where there is a conflict or possible conflict between their interest and duty.