How to own property abroad: company or trust

How to own property abroad: the short answer

A $1 million Miami condo held in a foreigner's own name leaves the heirs a bill from the Internal Revenue Service (IRS) of roughly $333,000. For non-residents, US estate tax starts once US assets exceed $60,000, while a US citizen dying in 2026 pays nothing on the first $15 million. That 250-fold gap has nothing to do with the property's price and everything to do with whose name is on the title.

The ownership structure settles four money questions: how much tax goes on purchase, how much on rent, how much on sale, and what the heirs receive and how fast. On top of that come protection from creditors and divorce, privacy, and whether a bank will accept the funds at all.

The headline conclusion comes before the tables. A single apartment for personal use is almost always cheaper to hold in your own name, backed by a will. A company, trust or private foundation pays for itself when there are several properties in different countries, when heirs hold different passports, or when the property's country taxes foreigners' estates heavily. For a Russian tax resident, any foreign structure also means filings with the Federal Tax Service and a possible controlled foreign company (CFC).

Buying property personally, through a company, trust or foundation: six options

There are six ways to hold real estate abroad, and each one changes the tax and inheritance picture. The property's country always comes first: its transfer tax, its land registry and its succession rules for real estate. Russian law points there too: succession to real estate generally follows the law of the country where it sits (Article 1224 of the Russian Civil Code).

• In your own name. The owner appears in the local land registry. Cheapest to maintain, but on death the heirs go through probate in the property's country, and under Russian law an inheritance must be accepted within 6 months (Article 1154 of the Civil Code).
• As a married couple. Title in both names or one. For Russian citizens, property bought during marriage is joint regardless of whose name is on it (Article 34 of the Family Code), unless a prenuptial agreement says otherwise.
• Through a local company in the property's country: a Spanish sociedad limitada (SL), a US limited liability company (LLC), a UAE company. The company pays tax on rent at the local rate, and the owner receives dividends.
• Through a foreign company from a third country, such as the British Virgin Islands or Cyprus. The property can be sold by selling the shares, but many countries penalise this kind of owner with special taxes.
• Through a trust. The settlor transfers assets to a trustee, who manages them for the beneficiaries. Typically the trust owns a company and the company owns the property. Jurisdictions are compared in our offshore trust overview.
• Through a private foundation. A legal entity with no owners, a charter and a council, familiar in civil law countries: Liechtenstein, Panama, Austria.

Tax on foreign property: how the ownership options compare

Purchase tax applies whatever the structure; the differences show up on rent, on sale and in special levies on companies. The table gives the overall picture with sample 2026 rates; exact figures depend on the property's country.

The second table covers the reasons structures usually exist: succession, protection and privacy.

Buying property in a company or personal name: three typical cases

A structure rarely pays for itself on the first apartment: a company brings bookkeeping, filings and profit tax, and a Russian owner adds CFC rules on top. Here are three situations where the answer differs.

Example 1. A rental apartment in Dubai. If the apartment is owned by an individual and let without a licence for that activity, there is no UAE corporate tax: Cabinet Decision No. 49 of 2023 expressly takes such real estate investment income out of scope. A company holding the same unit pays 9% on profit above AED 375,000. The conclusion: a single rental unit is better held personally, with succession handled by a will. A Russian tax resident still has to declare that rent at home.

Example 2. A family villa in Spain or France where the parents live and adult children with different passports visit. The main risk here is not tax on rent but succession: several heirs, several countries and probate under local rules. A foreign company is exactly what these countries penalise, with a 3% annual levy. Workable options: personal ownership with a will choosing the law of nationality (EU Succession Regulation No. 650/2012 allows this), or a local company whose shares sit in a trust or foundation.

Example 3. A portfolio across several countries. If a family owns apartments in, say, Dubai, Lisbon and London, each one held personally means a separate probate under its own country's law. The usual answer: a local owning company in each country, a holding company above them, and the holding owned by a trust or private foundation. The properties then pass to the next generation under the trust deed or foundation charter, without court proceedings in three countries. Each country still needs checking on its own: UK inheritance tax at 40% reaches residential property through offshore companies, and Portugal's property tax for a blacklisted company is 7.5% a year.

Property in the UAE: what happens to an estate without a will

Until February 2023, a non-Muslim who died in the UAE without a registered will risked having the estate divided under Sharia rules, where shares depend on gender and degree of kinship. Since 1 February 2023, Federal Decree-Law No. 41 of 2022 on Civil Personal Status has applied. For non-Muslim foreigners living in the UAE it introduced a secular default: half the estate goes to the surviving spouse and the other half is split equally among the children, with no difference between sons and daughters.

The law lets heirs ask for the law of the deceased's nationality to apply. But its scope is framed around foreigners residing in the country, and for owners who do not live in the UAE practice is not settled. That is why Murblz specialists advise against relying on defaults and recommend registering a will, either with the DIFC Wills Service Centre or with the Abu Dhabi Judicial Department's registry. For Muslims, Sharia still applies.

The second route is a Dubai International Financial Centre foundation (DIFC Foundation). Since May 2018, under an agreement between the DIFC and the Dubai Land Department (DLD), such foundations can buy and register property in areas open to foreign ownership. The founder's death does not stop the foundation: the property stays put and only the beneficiaries change under the charter. Transferring your own apartment into your own foundation may be treated as a gift with a 0.125% fee instead of the usual 4%, but the DLD decides case by case.

UAE taxes favour personal ownership: individuals pay nothing on rent while a company pays 9% (Example 1 above). A foundation is chosen for succession, not for tax. More detail in our UAE tax overview; properties are in real estate in the UAE.

Buying property in Europe: transfer tax and levies on offshore owners

In Europe the costliest moment is the change of ownership itself. Spain's transfer tax (impuesto sobre transmisiones patrimoniales, ITP) on resale homes runs from 4% in the Basque Country and 6% in Madrid to 10% and more in Catalonia. In France a buyer of an existing home pays 7-8.5% of the price in notary costs: 89 of 101 departments raised the transfer duty to about 6.32% for the period from 1 April 2025 to 31 March 2028.

Hence the first rule: choose the structure before you buy. If the apartment is already in your own name, moving it into your own company, trust or foundation is a new transaction, and transfer tax or capital gains tax falls due again.

The second rule: an offshore company pays more in Europe, not less.

• Spain charges a special levy of 3% a year on the cadastral value of property held by entities resident in tax havens (gravamen especial sobre bienes inmuebles de entidades no residentes), declared on form 213 each January. More in our Spain tax overview.
• France charges 3% a year on the market value of property held by legal entities and trusts (Article 990 D of the French Tax Code). Exemption is possible by disclosing the properties and owners to the tax office on form 2746 by 15 May each year, but not every entity qualifies.
• Portugal charges companies on its national tax haven list property tax of 7.5% a year and purchase tax of 10%. On 25 June 2026 the government approved a bill to use the EU list (10 jurisdictions, against 77 on the Portuguese one) as the reference, but Parliament still has to pass it and the final list is not yet known.
• The UK levies the Annual Tax on Enveloped Dwellings (ATED) on homes worth over GBP 500,000 held by a company: from GBP 4,600 in 2026/27 up to GBP 303,450 for properties over GBP 20 million. And since 6 April 2017, UK inheritance tax at 40% looks through offshore companies and trusts whose value derives from UK residential property.

The EU offers a tool most countries lack: Regulation No. 650/2012 lets you choose the law of your nationality in your will, and courts in EU countries other than Denmark and Ireland apply it. It does not remove tax: Spain's basic inheritance tax scale reaches 34%, with regional reliefs on top.

Buying property in the US: estate tax for non-residents

The US taxes foreigners' estates more harshly than almost any other developed country. If the deceased was neither a US citizen nor domiciled there, tax applies to all US assets above $60,000: real estate, tangible property in the country and shares in US corporations. The rate climbs to 40%. For US citizens, the One Big Beautiful Bill Act (Public Law 119-21) set a $15 million exclusion from 2026.

Sample calculation. A $1,000,000 Miami condo in a foreigner's name, no mortgage. Under the estate tax rate schedule the tentative tax is $345,800; after the $13,000 unified credit available to non-residents, it is $332,800, a third of the value. The calculation ignores administration expenses and other deductions.

That is why foreigners often buy US property through a foreign corporation: according to the IRS, only shares in corporations organised under US law are US-situs assets. The route has its own costs. The company pays 21% federal corporate tax. On a sale, the buyer withholds 15% of the price under the Foreign Investment in Real Property Tax Act (FIRPTA). And a US LLC owned by a foreigner files Form 5472 every year on pain of a $25,000 penalty.

More in our US tax overview; for properties and the transaction see real estate in the USA.

Foreign property and Russian tax: CFCs, trusts and foundations

Russia levies no property tax on an apartment abroad, and there is no separate duty to report simply owning one. But a Russian tax resident (183 days or more in the country within 12 consecutive months) pays personal income tax on worldwide income, and a company, trust or foundation adds mandatory filings with penalties of up to RUB 500,000.

If the property is held personally.

• Rent is taxed on the main progressive scale of 13% to 22% (Article 224 of the Tax Code). Tax paid in the property's country can be credited if a double tax treaty is in place (Article 232). Presidential Decree No. 585 of 8 August 2023 suspended parts of the treaties with 38 countries, including the US, Spain, France, Cyprus and Portugal, but the articles on eliminating double taxation remain in force.
• A sale is tax-free after the minimum holding period: 3 years for property inherited or gifted by a close relative, 5 years otherwise (Article 217.1; the Ministry of Finance has confirmed the rule covers foreign property). An earlier sale is taxed at 13% on income up to RUB 2.4 million and 15% above.
• Income goes on the 3-NDFL return by 30 April of the following year, with tax due by 15 July.

If the property is held by a foreign company.

• A stake above 10% requires a notice of participation in a foreign organisation within 3 months (Article 25.14). The penalty for missing it is RUB 50,000 per company (Article 129.6).
• The company becomes a CFC if the owner's stake exceeds 25%, or 10% where Russian residents together hold more than 50% (Article 25.13). An individual files the CFC notice by 30 April of the year after the year in which profit is taken into account, together with the company's financial statements. The penalty for not filing is RUB 500,000 per CFC.
• CFC profit is added to the owner's income if it exceeds RUB 10 million for the year (Article 25.15(7)) and taxed on the main scale of 13% to 22%. Exempt are, among others, companies from Eurasian Economic Union states and companies whose effective tax rate is at least 75% of the Russian weighted average (Article 25.13-1). The alternative is tax on a fixed profit: from 2025 it is RUB 27.99 million for a single CFC (Article 227.2).

If a trust or foundation holds the property. The Tax Code treats a trust as a foreign structure without legal personality, which can also be a CFC (Article 25.13(2)). The settlor is the controlling person by default (paragraph 9). The settlor ceases to be one only if, at the same time, they have no right to receive or dispose of the structure's income, have kept no rights to the transferred assets (the transfer is irrevocable) and do not influence decisions on distributions (paragraph 10). Foundations without share capital follow the same rules (paragraph 15). Establishing such a structure must be notified within 3 months (Article 25.14). Filings and profit calculations are covered in CFC filings.

Owning property in a trust: what sanctions changed for Russians

The classic trust jurisdictions are largely closed to Russian citizens and residents. Article 5m of EU Regulation No. 833/2014 prohibits registering trusts and similar arrangements, providing them with an address and managing them where the settlor or a beneficiary is a Russian national or an individual residing in Russia. The exception covers EU citizens and holders of temporary or permanent EU residence permits. That applies to Cyprus, Malta and the rest of the bloc.

The UK introduced its own prohibition on 16 December 2022, and it also applies in Jersey, Guernsey, the Isle of Man, Gibraltar and the BVI. The British rule turns on residence, not nationality: it catches anyone ordinarily resident or located in Russia, as the Society of Trust and Estate Practitioners (STEP) explains. A Russian citizen resident in, say, the UAE falls outside the UK ban, but inside the EU one unless they hold an EU residence permit.

So for a buyer from Russia the list of real options is shorter: Seychelles trusts and foundations, the Panama foundation, UAE foundations and, with an EU residence permit, European jurisdictions too. The final word rests with the trustee or registrar, each of whom runs their own client and source-of-funds checks.

Pitfalls: when a structure costs more than personal ownership

The most expensive mistake is buying in your own name and building the structure later: a second round of transfer tax wipes out the benefit for years. The other traps are rarer but just as costly.

• A trust set up against debts. If assets go into a trust after creditors' claims have surfaced or in the middle of a divorce, a court can set the transfer aside. Protection works when the structure is created early and with clean money.
• Hidden control. If the settlor keeps the right to revoke the transfer or to direct the income, the Russian tax office still sees a controlling person and a court sees the real owner.
• Penalty regimes for offshore owners. Spain and France take 3% a year, Portugal 7.5%, and the UK adds ATED and inheritance tax through the company. A BVI company over a Spanish apartment almost always costs more than owning it personally.
• Mortgages and banks. Banks rarely lend to offshore companies against homes, and a company account takes longer to open with a detailed source-of-funds review. Russians face limits in the EU: Article 5b of the same regulation bars banks from accepting deposits from them above EUR 100,000 per bank, except for EU residence permit holders.
• Transparency. Beneficial owners of companies and trusts are visible to registers, banks and tax authorities under CRS. Since 2022, foreign companies owning UK property must disclose their owners in the Register of Overseas Entities. A structure does not buy anonymity.
• Annual costs. Agent, accounts, audit, trustee fees and Russian CFC filings. They pay off on a portfolio, rarely on a single apartment.

What we do: from choosing the property to the succession plan

The ownership structure is chosen before the deposit, not after completion. So the work starts with three questions: where the property is, where the owner is tax resident, and who the heirs are.

• we find the property and support the transaction through investment property: countries, prices, seller and title checks;
• we register the owning company in the property's country or a holding company elsewhere: company formation in almost 100 jurisdictions, including the UAE, the USA and Cyprus;
• we set up trusts and private foundations, with jurisdiction cards above on this page, from the Seychelles to Liechtenstein;
• we build the succession plan: inheritance planning in the UAE and a will under BVI law for assets held in companies;
• we calculate tax in the property's country and the country of residence, compare regimes in taxes by country and prepare CFC filings;
• we open business accounts for the purchase payments, rent and running costs.

If the country is not chosen yet, start with our investment property overview: it lists countries with different taxes and rules for foreign buyers.