A bare trust is a legal structure that holds property on behalf of a beneficiary, with the trustee having no discretion or control over the property. A bare trust deed is used to connect the legal owner of the property (bare trustee company) with the beneficial owner (SMSF). In the context of self-managed super funds (SMSFs), a bare trust is used to hold property purchased by the SMSF until the loan is repaid. This structure is necessary to comply with SMSF regulations when acquiring property with security, such as a mortgage. Setting up a bare trust involves preparing a trust deed, naming fund trustees, and ensuring compliance with tax obligations. The costs associated with establishing a bare trust structure may vary, with potential expenses including the corporate trustee, custodian trustee, and bare trust. To avoid common mistakes, it is crucial to seek advice and ensure that your investments are protected properly from the outset.

Bare Trust

Set up your bare trust online.
Your SMSF must be set up and ready to buy property before setting up a bare trust.
Speak to a mortgage broker or lender to understand how much your SMSF can borrow.
Submit your bare trust order online.
Make payment from your SMSF cash account.
We prepare your bare trust documents and register your bare trustee company with ASIC.
We provide instructions on what name goes on the purchase contract.

Understand the SMSF borrowing process

Bare trust documents will be signed either before or after the contract.
We provide instructions on when to sign.
Sign electronically in most cases.
5. Finance approval
Get final approval for your SMSF loan.
We provide you with certified copies of SMSF and bare trust documents for the lender.
Now it's time settle your SMSF property purchase. If you've followed all the instructions from Grow, your mortgage broker or lender and your solicitor, settlement will happen smoothly.

Bare trust setup fees

$799
Bare trust only
  • Existing company as trustee
  • Online paperless application
  • Sign electronically
  • Bare trust deed
  • SMSF minutes for borrowing
  • Updated SMSF investment strategy
  • Certified copies for finance
  • Phone & email support
$1375
Bare trust + company
Essential βœ…
  • New trustee company
  • Includes company registration✝
  • Online paperless application
  • Sign electronically
  • Bare trust deed
  • SMSF minutes for borrowing
  • Updated SMSF investment strategy
  • Certified copies for finance
  • Phone & email support
$799
Bare trust only
  • Existing company as trustee
  • Online paperless application
  • Sign electronically
  • Bare trust deed
  • SMSF minutes for borrowing
  • Updated SMSF investment strategy
  • Certified copies for finance
  • Phone & email support
$1375
Bare trust + company
Essential βœ…
  • New trustee company
  • Includes company registration✝
  • Online paperless application
  • Sign electronically
  • Bare trust deed
  • SMSF minutes for borrowing
  • Updated SMSF investment strategy
  • Certified copies for finance
  • Phone & email support

✝ Bare trust setup fee includes the fee to register a new trustee company with ASIC.

Why choose Grow to setup your SMSF?

Learn why we are the SMSF setup experts:
Human support
We guide you through the entire SMSF setup process and beyond. Help and answers always available via phone or email.
Quality SMSF documents
We use high-quality SMSF trust deeds that allow investment into any allowable asset including support for cryptocurrency and digital assets.
Completely digital
Our SMSF setup process is completely digital. Paperless from application, signing documents, bank/broker applications and transferring your super.
Changes at no cost
Each property requires its own unique bare trust. We understand that sometimes a purchase doesn't go ahead and the target property changes. Grow enables you to change the nominated property two times without additional fees.
Fast bare trust set up
Once payment is received, we will set up your bare trust within 1 business day (Mon-Fri) giving you the best opportunity to secure your purchase.
As registered tax agents and SMSF specialist accountants, Grow can take care of all your ongoing SMSF compliance needs including SMSF accounts, tax returns and the independent audits.

Frequently Asked Questions

What is a bare trust and why is it necessary for SMSF property investment?

A bare trust is a legal structure that holds the property on behalf of the SMSF until the loan is repaid.

SMSF regulations require that any property acquired with borrowings (e.g., a mortgage) be held in a bare trust, with the SMSF as the primary beneficiary (or beneficial owner).

How do I set up a bare trust for my SMSF property investment?

To set up a bare trust, you will need to determine the trustee (new or existing company) and arrange a bare trust deed and associated minutes.

Whether you’re a new or existing customer of Grow, you can order your bare trust (and trustee company) online here: Bare Trust Order Form

What are the costs associated with setting up a bare trust structure?

To set up a bare trust with Grow is as follows:

  • Bare trust only (using an existing company) – $799
  • Bare trust with new trustee company – $1375

You can order your bare trust online here: Bare Trust Order Form

Who is responsible for the property's income, expenses, and deductions?

The bare trust trustee should hold the property title and nothing else.

Any rental income, property expenses, fees, land tax, and other costs are received or paid by the SMSF trustee, so there is no requirement for a separate bank account for the bare trust.

A bare trust doesn’t have its own ABN or TFN, and there is no requirement for the bare trust to lodge a tax return or prepare accounts.

The only ongoing cost relating to a bare trust are the ASIC fees for the trustee company, which is paid by the SMSF.

Can I use a bare trust to buy residential or commercial properties?

Yes, you can use a bare trust to buy both residential and commercial properties.

Each property purchase with borrowings requires its own unique bare trust, but the same trustee company can be used for multiple bare trusts.

Can I have multiple properties in a single bare trust?

No. Only one property can be held in a bare trust at a time.

To purchase multiple properties, you must set up a separate bare trust for each property.

The same trustee company can act as trustee for multiple bare trusts.

What are the common mistakes to avoid when using a bare trust for SMSF property investment?

The most common mistakes when setting up a bare trust for SMSF property investment are:

  1. Putting the incorrect name on the property purchase contract;
  2. Signing the bare trust documents at the incorrect time.

The name on the contract varies depending on the state the property is located.

When the bare trust deed is signs also varies depending on the state the property is located. You will either sign the bare trust documents before or after signing the contract.

Does an SMSF bare trust need to be stamped?

Whether an SMSF bare trust needs to be stamped depends on the state in which it is being established. Here are the stamping requirements for some Australian states:

  • New South Wales (NSW): Duty is payable, and the Declaration of Trust must be lodged through a Revenue NSW (OSR) agent on Duties Online or through the OSR public lodgement system. The OSR’s EDR system does not allow agents to duty stamp holding trusts, so the deed and other required documentation must be dropped off at one of their Revenue NSW locations or posted to them. Double stamp duty can be avoided if the exemption under Section 55 of the Duties Act, 1997 is met.
  • Victoria (VIC): No duty is payable on an Asset Acquisition Trust (AAT) in Victoria, but the Deed must be lodged with the State Revenue Office (SRO) through an SRO agent on Duties Online or through the SRO’s public lodgement system.
    .
  • Northern Territory (NT): Duty is payable, and the executed Deed must be dropped off at the appropriate location.
  • QLD, SA, ACT, TAS & WA – Stamp Duty is not payable on the declaration of Trust (bare trust deed not required to be stamped).

The specific requirements and fees may vary, so it is advisable to contact the local revenue office or seek independent legal advice to confirm the stamp duty obligations for an SMSF bare trust in a particular state.

Grow SMSF Reviews

Google 5.0/5.0
Highly Recommend!
I highly recommend the services that Kris and Grow SMSF provide. Top quality service and all set up within a day. Professionally guided through the process with excellent communication and efficiency. Grow SMSF prices are so low for what you are getting - Amazing...
Could not be happier.

Allan M.
Google Review

Great customer service

I highly recommend Kris from Grow SMSF. Cheap setup and ongoing costs, great customer service, very helpful and professional. I was amazed how quick the SMSF was setup. It only took 2 weeks for Kris to set the SMSF up vs my friend's accountant took 2 months to set his. I am so glad that I found Grow SMSF.

Rose D.
Google Review

Great service and guidance
I've worked with Kris from Grow SMSF for a number of years and he's always delivered a great service and advice where needed. From the original setup of my SMSF through to getting the returns etc done each year, everything works well with no drama. Highly recommend + keep up the good work!

Simon P.
Google Review

Great assistance

Kris is very responsive to queries and flexible - always takes the time to explain and assist. I would recommend him to anyone wanting to dip their toes into an SMSF.

Steve BD.
Google Review

Responsive and effective support
Kris is exceptional. Very responsive, effective and diligent.

Stephen W.
Google Review

Ready to go?

Set up your bare trust today with Grow.

Bare Trust Setup Questions?

Setting up an SMSF and bare trust can be daunting. Get in touch to ask any questions you have about setting up a bare trust to purchase property via an SMSF with borrowings.
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Copyright Β© 2020 by Grow SMSF Pty Ltd. All rights reserved.
Registered Agent Number 26057627.

General Information Warning & Disclaimer

All information contained on this website is provided as an information service only and, therefore, does not constitute, and should not be relied upon as, financial product advice. None of the information provided takes into account your personal objectives, financial situation or needs, and you will need to make your own decision about how to proceed. Alternatively, for financial product advice that takes account of your particular objectives, financial situation or needs, you should consider seeking financial advice from an Australian Financial Services licensee before making a financial decision.

Grow SMSF does not hold an Australian Financial Services Licence (AFSL) and we are not authorised representatives of a AFSL. We do not provide financial product advice or recommend any financial products either expressly or implied.

From time to time Grow SMSF may produce information or content about specific financial products or services that enable access to specific financial products however we do not recommend, endorse or confirm as suitable any financial product or service featured on the Grow SMSF website or social media assets. This condition specifically applies to any financial product where Grow SMSF provides services at a discounted or preferential fee due to the use of those products, services or accounts. It’s not compulsory to utilise a specific account or service provider to be a client of Grow SMSF however the types of accounts, investments and service providers you use for your SMSF will determine the fees your SMSF is charged.

Where Grow SMSF provides information in relation to a financial product or service supported by or integrated with Grow SMSF the information is factual information only about the operation of the account or service and how data or reporting information is made available to us. Before making a decision on any financial product for your SMSF you should obtain a Product Disclosure Statement (PDS) relating to that product and consider the PDS before making any decision. As financial product and solution providers are frequently making changes to their products and services Grow SMSF cannot accept any responsibility for any outdated or inaccurate information provided on this website or via social media assets.

Grow SMSF Gold Coast based accountants looking after SMSF trustees from around Australia. Liability limited by a Scheme approved under Professional Standards Legislation.