Best setup for brothers buying investment property together

What state are the properties in? You would need to at least consider a trust if you are approaching the land tax threshold.

You also need to protect your own interest if your brother were to go bankrupt, die or divorce.

In addition you need to plan things to reduce personal liabiity and assist borrowing power.

A unit trust might be the more appropriate structure to make sure you establish the proper amount of % shareholding of each person. It avoids disputes as to who owes/owns what.

Hi KMC
i have been buying property with my two brothers since 1989.
First up was a partnership.Partnerships suck.
Eg. If one partner wants out – this can create a trigger – from a minority owner – at a time that may not suit the other partners – so the whole thing can topple over, or force a refinance. Higher risk.
Set up a pty ltd – much more stable, each shareholder is responsible for his own shares – for example a divorce – split the shares. Less risk.
Brothers in a company – still going strong.

I was on a mobile device when i wrote the above, so let me elaborate why you should not use a company:
1. No 50% CGT discounts for companies
2. Income of a company does not retain its character. Capital gains will be passed on as dividends to shareholders – which may not help a shareholder who has a capital loss from another investment for example.

A better way to join with someone is to use a unit trust with a company as trustee and the units owned by the investors – who could then use a discretionary trust to own their units depending on the circumstances.

A trust is a legal arrangement best done by a person who knows what they are doing – lawyer and/or accountant. Lawyer better really as there are a host of legal issues, but you may need some tax advice too.