Using secret family deals to avoid taxes can exact a heavy price

It might be tempting to use a secret family arrangement to save on real estate taxes, but venturing into this legal minefield brings high risks, including the chance you could lose the property.

- Tan Ooi Boon

Hiding behind a "secret trust" — getting a relative to hold a property on your behalf — so you do not appear on records as an owner seems easy at first glance, but such deeds don't stay hidden for long, especially if a family dispute flares.

MOTHER PUT HOME IN CHILDREN'S NAME

In an Australian case that is often cited by judges here, a woman put her home in the name of her children because she wanted to get state subsidies meant to help widows of war veterans buy homes if they did not own any property.

But she did not count on falling out with her children, who sold her house for themselves. She won her case when she sued the children to stake her claim on the sale proceeds, but had to return her ill-gotten subsidies.

PROPERTY BOUGHT IN SON'S NAME

A Singapore couple bought a $5 million home in July 2020 to be held in trust for their son.