Buying property through a trust or SMSF in NSW

Stamp duty when a trust buys

Revenue NSW has no separate stamp duty rate for trusts. The general scale applies, including the premium rate for residential property over $3,870,000.

First home buyer relief is for individuals. A trust or company is not eligible unless Revenue NSW waives that requirement on application.

Foreign beneficiaries in a discretionary trust

A discretionary trust can be treated as a foreign trust if any beneficiary, or anyone who could become one, is a foreign person.

A foreign trust buying residential property may pay surcharge purchaser duty of 9% on top of normal duty, and surcharge land tax of 5% of the land value each year.

For the trust not to be treated as foreign, the deed must remove foreign beneficiaries and must not be able to be changed to add them. The change must be irrevocable. Simply not paying them is not enough.

We check the trust deed before the trust signs a contract.

Unit trusts and fixed trusts

A unit or fixed trust can be treated as foreign if one foreign person holds 20% or more, or foreign persons together hold 40% or more.

Land tax for trusts

A trust that does not meet the concessional trust criteria is a special trust, and discretionary trusts do not get the threshold. A special trust pays land tax at 1.6% from the first dollar, with no threshold, and 2% above the premium threshold.

The home exemption generally does not apply to land held in a special trust.

Read land tax in NSW after you buy.

Buying property in an SMSF: the rules

1. The sole purpose test: the property must be held only to provide retirement benefits to members.
2. Members and their relatives must not get a benefit from it now. The ATO gives the example of holidaying in the fund's property.
3. The fund cannot buy residential property from a member or related party. Business real property is an exception.
4. Business real property can be leased to a related party, at market rent on arm's length terms.
5. Every investment must be on commercial terms and fit the fund's investment strategy.

SMSF borrowing changed on 10 August 2026

An SMSF generally cannot borrow. The exception is a limited recourse borrowing arrangement, where the property is held in a separate holding trust until the loan is repaid.

From 10 August 2026, a limited recourse borrowing arrangement can be used to buy real property only if it is business real property.

An SMSF can still buy residential property with its own money, but it cannot borrow for it under a new arrangement.

The change does not affect arrangements entered into before 10 August 2026, their refinancing, or contracts exchanged before that date.

Stamp duty for an SMSF

The purchase itself pays stamp duty on the general scale.

When the loan is repaid and the property moves from the holding trustee to the SMSF trustee, duty on that transfer is capped at $750, if there is no change in who owns it beneficially and the other conditions are met.

Where buyers get caught

Tax and super advice should come from your accountant or financial adviser. We deal with the contract, the trust deed, duty and land tax.

Common questions