If you’re planning to build a substantial property portfolio, here’s why you should do it using a Trust

Julie Brownlee, Fsp Invest, 15 May. 2015

Tags: trust, property, investing in property, buying property using a trust, property investment vehicles, property investor,



If you’re serious about investing in property, you have a number of options when it comes to buying.

You can buy properties as an individual, in a partnership, using a company or using a Trust.

If your goal is to buy a number of properties, a Trust is the best option.

Here’s why…



When a Trust is the best option


An Inter Vivos Trust (a living Trust) is the best option if you plan to buy a substantial number of properties over the years.

The main advantage of a Trust is that it protects your assets, in this case property. Your properties will be completely safe, even if you get divorced, someone sues you or you have creditors chasing you.

The other major plus of buying property using a Trust is that when you pass away, the Trust will continue on as before.

Your family, or whoever you decide to make as benefactors of your Trust, won’t have to pay estate duty or other taxes as they would if you owned the properties as an individual, in a partnership or in a company.


When a Trust isn’t a good option for you


If you buy a lot of properties to do up and sell, a Trust isn’t the best option. This is because Trusts attract higher capital gains tax than individuals, partnerships and companies.

But if your goal is to build wealth through property and pass it on to your dependents, a Trust is well worth considering.

Once it’s set up, the admin is minimal.

So there you have it. Why you should use a Trust is you’re planning to build a substantial property portfolio.

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