Paper 1 · Land Law
Trusts, Gifts, Succession & Future Interests in Property
Must-know for the exam
- A trust splits ownership: the trustee holds legal title with their name on the title, while the beneficiary holds the beneficial (equitable) ownership.
- A minor (under 21) cannot hold land in their own name, so an adult trustee holds legal title on trust until the child comes of age.
- An express trust is created deliberately by deed or will, a bare trust is a nominee holding with no active duties, and a resulting trust is implied by law.
- Under the ABSD (Trust) rule, ABSD is payable up front when residential property is transferred into a living trust; a trust is not an ABSD avoidance route.
- A remission of ABSD (Trust) may be claimed back where all beneficiaries are identifiable individuals, but the duty must be paid first; conditions are confirmed with IRAS.
- A gift is a voluntary transfer for no or below-market payment, yet stamp duty is assessed on market value and BSD and any ABSD can still apply to the recipient.
- A buyer from an estate deals with the executor (grant of probate, with a will) or administrator (letters of administration, intestate), who needs the grant before validly selling.
Not every property transaction is a straightforward sale between two adults. A parent may want to buy for a young child, an owner may gift a flat to a relative, and every owner will eventually die — triggering questions about who inherits and how the property can be sold. This lesson covers the CEA competencies on trusts, gifts, succession and future interests, all of which regularly appear in RES scenarios and in real practice.
Legal vs beneficial ownership: the trust concept
A trust splits ownership of property into two parts. The trustee holds the legal ownership — their name is on the title — but they hold it for the benefit of someone else. The beneficiary holds the beneficial (equitable) ownership — they are the person truly entitled to enjoy the property. Property held this way is said to be held on trust.
A common reason to use a trust is that a minor (a person under 21) cannot hold land in their own name. If a parent wants a property to belong to a young child, an adult trustee holds the legal title on trust for the child until the child comes of age.
| Type | How it arises | Typical use |
|---|---|---|
| Express trust | Deliberately created by the owner, usually in a written trust deed or will | Parent settles a property on trust for a child |
| Bare trust |
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Practise exam-style questions on Land Law — with instant answers and explanations.
Practise Land Law questions →Exam-style questions on this topic
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Common questions
- Does buying a property in trust for my child avoid ABSD?
- No. Under the ABSD (Trust) rule, ABSD is payable up front when residential property is transferred into a living trust. A remission may be available where all beneficiaries are identifiable individuals, but the duty must be paid first and then claimed back. Always confirm the current rate and conditions with IRAS.
- What is the difference between a grant of probate and letters of administration?
- A grant of probate is issued where the deceased left a valid will — it confirms the executor's authority to deal with the estate. Letters of administration are granted where the person died intestate (no will), appointing an administrator to distribute the estate. A buyer purchasing from an estate should confirm the correct grant is in place before completing.
- If one co-owner dies, does their share always pass under their will?
- Only if they held the property as tenants in common — then their share forms part of their estate and passes by will or intestacy. If they held as joint tenants, the right of survivorship applies and the interest passes automatically to the surviving joint tenant, outside the estate, regardless of any will.
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Join @resprepsg →Study material aligned to the public CEA syllabus. Not financial or legal advice — verify current figures with the relevant authority (IRAS, HDB, CEA, MAS).