How to Hold a Freehold Venue You Buy in FY27
Freehold Venue Ownership Structure | Switchboard Finance
Accommodation Finance
Commercial Property · Trust or Company · SMSF
How to Hold a Freehold Venue You Buy in FY27
Buying a freehold pub or motel in the new financial year is as much a structuring decision as a finance one. Where you hold the title, in a trust, a company or as SMSF business real property, shapes the loan, the tax and the exit. Here is how the holding structure reads to a lender, and what the Budget changes mean for it.
Quick Answer
If you are buying a freehold going concern this financial year, the ownership structure comes first: most hold the freehold in a trust or company, sometimes as SMSF business real property, and finance it with a commercial property loan. Set the structure with your accountant before you offer.
Set the structure first
The ownership structure is the first thing an underwriter weighs, well ahead of the rate. When you buy a freehold pub or motel as a going concern, the first decision is who holds the freehold title: you, a company, a trust, or a self managed super fund. From the underwriter's seat, that choice sets how the whole deal reads long before a rate is quoted.
Most buyers end up with a freehold going concern held in a trust or company, financed with a commercial property loan secured by a first mortgage over the title. Across the accommodation finance lane, that is the structure we arrange most often for a freehold pub or hotel. Get the structure set with your accountant before you offer, because unwinding it after contracts are signed is slow and costly.
Trust, company or SMSF business real property
Three structures do most of the work for a freehold venue, and a lender reads each one differently. A discretionary trust gives distribution flexibility and asset protection, but credit wants to see a trust deed that clearly permits borrowing and a corporate trustee holding the title rather than an individual. A company gives a simpler, flatter read that many lenders prefer. An SMSF can hold the venue as business real property, with the fund as owner-occupier paying market rent back to the fund.
Whichever you choose, the borrowing base is the freehold itself. A lender will usually advance up to around 70 per cent of the going-concern valuation, indicative and varies by lender, and the loan attaches to the freehold bricks rather than the headline business value. How that security read is built is set out in our lender-eye note on motel freehold valuation.
Where the holding structure passes
- Trust deed that clearly permits borrowing and guarantees
- A corporate trustee, not an individual, on the title
- Company or trust with a clean, traceable ownership line
- An SMSF buying business real property, not residential
- Structure set before the offer, not after contracts
Where it stalls in credit
- A trust deed silent on borrowing or out of date
- Layered structures that hide who controls the asset
- An SMSF trying to hold residential under the new rules
- An owner living in or privately using the venue rent free
- Structure changed mid-deal, restarting the credit read
The wider market backdrop for an FY27 purchase sits behind all of this.
What the Budget trust and CGT changes mean
The Budget changes do not stop you holding a venue in a trust, but they do change the tax arithmetic on the way out, so they belong in the structure decision now. Treasury's small business explainer on the CGT and discretionary trusts reform sets out the direction.
The four small business CGT concessions stay. The headline change passed Parliament on 25 June 2026 and commences 1 July 2027: the flat 50 per cent CGT discount is replaced by a discount for inflation plus a 30 per cent minimum tax on real gains. It is prospective, so any value you build up before that date keeps the old 50 per cent rule and a venue bought now is not caught retrospectively. Some detail, including the small business and start-up carve-outs, is still being settled in consultation. For the minority of owners who use a discretionary trust, the 30 per cent minimum tax on discretionary trusts from 1 July 2028 is the next measure to plan around, with restructure support flagged for those who move and most small businesses not affected in any given year. That trust tax is announced but not yet law. So price the legislated CGT change into how you hold the asset now, and plan around the trust measure as intended rather than settled.
Buying the freehold through an SMSF
You can buy a freehold pub or motel through an SMSF, because the new limits target residential property, not commercial. The SMSF residential lending change, part of the tax package that passed Parliament on 25 June 2026 with commencement tied to Royal Assent, winds back new residential borrowing inside a fund. It does not touch a working venue: a pub, motel or park bought as SMSF business real property (the residential SMSF change does not apply) can still be acquired and, where needed, financed.
From the underwriter's seat, an SMSF venue deal lives or dies on a clean arm's length lease and a fund that can service the loan, with the fund as owner-occupier paying market rent back to the fund. Specialist funders still write SMSF commercial lending up to around 70 per cent of the going-concern valuation, indicative and varies by lender, and where the freehold and the business are funded together our note on the freehold and business split walks it through. One boundary to be clear about: Switchboard arranges the secured credit over the freehold, while the trust, company or SMSF structuring itself is licensed-partner territory, set with your accountant and licensed advisers, not your broker. How the pricing on that lending is built is covered in our guide to commercial property loan rates.
A freehold venue you buy in FY27 is a structuring decision first and a finance decision second. Hold the freehold in a trust, a company or as SMSF business real property, match it to a commercial property loan against the going concern, and price in the Budget trust and CGT changes before you offer rather than after you settle.
Key takeaway: decide who holds the freehold title before you sign, because the structure shapes the loan, the tax and the exit.Frequently Asked Questions
You can buy a freehold pub or motel through an SMSF, because the rules that are tightening target residential property, not business real property. A working pub, motel or park bought as SMSF business real property can still be held in the fund, usually with the fund as owner-occupier paying market rent back to the fund under an arm's length lease. The structuring sits with your accountant and licensed advisers, while a commercial property loan covers the secured borrowing.
Whether you hold a freehold venue in a trust or a company depends on asset protection, how you want income taxed and how cleanly a lender can read the structure. A discretionary trust offers distribution flexibility but needs a trust deed that clearly permits borrowing, while a company gives a simpler, flatter read. This is an accountant's decision first and a finance decision second, so settle it before you offer.
Borrowing against a freehold going concern is usually sized at up to around 70 per cent of the going-concern valuation, indicative and varies by lender, because a venue is a specialist security. The loan attaches to the freehold bricks rather than the headline business value, which our motel freehold valuation read explains. A clear deposit or equity position and a clean going concern read move the number in your favour.
The Budget trust and CGT changes do not affect the gains you build on a venue you buy now, because the reform is prospective. The CGT change passed Parliament on 25 June 2026 and commences 1 July 2027, and Treasury's explainer confirms that value accrued before that date keeps the existing 50 per cent discount rule. A separate 30 per cent minimum tax on discretionary trust income is announced from 1 July 2028 but is not yet law. Plan around the legislated CGT change now and treat the trust measure as intended rather than settled, and our going concern explainer sets the context before you check the structure with your accountant.
A self managed super fund can still borrow for a commercial venue, because the residential lending change does not extend to business real property. Specialist funders continue to write SMSF commercial lending against a freehold pub, motel or park, typically up to around 70 per cent of the going-concern valuation, indicative and varies by lender. The fund holds the title as owner-occupier paying market rent back to the fund, and a commercial property loan sits behind it.
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