Declaration of Trust BEFORE You Buy (‘secretly buy’)
Let’s say that you own 7 out of 8 of the units in the same block. The last unit finally comes onto the market. The vendor knows that you own all the other units and is going to hold out for a lot of money. But you never approach the vendor. Instead you get a friend to sign a Declaration of Trust BEFORE You Buy. Your friend is the trustee. You are the beneficiary.
You, as a Trustee, sign the Declaration of Trust BEFORE You Buy first. Only then does your friend offer to buy the unit. The vendor sells the home to your friend – unaware that you are the true purchaser. Your friend delivers the contract of sale to you and using the Declaration of Trust BEFORE You Buy the property settles in your name for no additional stamp duty or any CGT. The vendor is furious, but there is nothing he can do.
Your friend was just the ‘trustee’ of the asset. You, as the beneficiary, own the asset in equity – you are the ‘true’ owner. At any time, the beneficiary can direct, the Trustee, to transfer the asset to the beneficiary. There is generally no stamp duty or CGT for the transfer from the Trustee to the Beneficiary
Open a bank account for another person?
You can also use this document to open a bank account for your children and partner.
Other types of bare trusts we have available:
Acknowledgement of Trust - ‘AFTER the Trustee buys’
Gifting Trust - ‘death bed declaration’
Bare Trust Deed - 'hide assets you own'
Please contact me for further legal advice on your document.
Dr Brett Davies
39 Stirling Highway, Nedlands
(08) 63890100 or 0477796959