Trust Registration

this image is about trsuts registration with Zfiling
Document Required
Know More

Trust Registration:

Get Trust Registered With Us !
INR 5,499/- All Inclusive
INR 7,499 /- , 2,000/- Off

Consultation by Experts, Application Filing with Trust Registrar, PAN/ TAN of Trust, Follow Up with Department.

*Prices may vary depending upon location of service and stamp duties.

Terms & Conditions

Get Quote
Pay Now

Get in touch

Please enable JavaScript in your browser to complete this form.

Submit your details for personalised quotes for diverse service requirements and a FREE Expert consultation!

TRUST REGISTRATION

A. Trusts: Comprehensive Details:

 A Trust is a fiduciary arrangement established by one party, known as the trustor or settlor, who transfers property or assets to another party, the trustee, to manage for the benefit of a third party, the beneficiary. Governed by the Indian Trusts Act, 1882 for private trusts and by specific state laws for public trusts, trusts can be created for various purposes including charitable, religious, or private interests such as estate planning and asset protection. The foundational document of a trust is the trust deed, which details the terms, conditions, and objectives of the trust, specifying the roles and responsibilities of the trustor, trustee, and beneficiaries.

Trusts can be revocable, allowing the trustor to modify or terminate the trust, or irrevocable, which once established, cannot be altered. The formation of a trust involves drafting and executing the trust deed on non-judicial stamp paper, registering it with the relevant authorities, obtaining a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN), and opening a bank account in the trust’s name. Compliance with annual filings, audits, and income tax returns is mandatory, especially for public trusts, which may also need to file with the Charity Commissioner. Trusts provide numerous benefits including tax exemptions, asset protection, and perpetual existence, ensuring long-term benefits for beneficiaries. However, they also entail complexities and costs related to legal, administrative, and compliance obligations.

B. Parties Involved in a Trust

  1. Trustor/Settlor
  • The individual or entity that creates the trust.
  • Transfers property or assets to the trustee.
  • Sets the terms and conditions of the trust.
  1. Trustee
  • The individual or entity responsible for managing the trust.
  • Holds legal title to the trust property.
  • Acts in the best interest of the beneficiaries in accordance with the trust deed.
  1. Beneficiary
  • The individual or group that benefits from the trust.
  • Receives benefits or income from the trust property.
  • Can be specific persons or the general public (in the case of public trusts).

C. Types of Trusts in India

  1. Private Trusts
    • Purpose: Created for the benefit of specific individuals or groups.
    • Governing Law: Indian Trusts Act, 1882.
    • Examples: Family trusts, employee benefit trusts.
    • Key Features:
      • Specific beneficiaries.
      • Can be revocable or irrevocable.
      • Primarily used for estate planning and asset protection.
  1. Public Trusts
    • Purpose: Created for the benefit of the general public or a section of the public.
    • Governing Law: State-specific laws (e.g., Bombay Public Trusts Act, 1950).
    • Examples: Charitable trusts, religious trusts, educational trusts.
    • Key Features:
      • Beneficiaries are the general public or a segment of the public.
      • Must serve a public purpose such as education, relief of poverty, medical relief.
      • Typically irrevocable.

Sub-Types of Public Trusts

  1. Charitable Trusts
    • Objective: Promote social welfare, education, relief of poverty, or any other object of general public utility.
    • Examples: Schools, hospitals, relief funds.
  1. Religious Trusts
    • Objective: Promote religious activities or maintain religious properties.
    • Examples: Temples, mosques, churches.
  1. Educational Trusts
    • Objective: Promote education and learning.

· Examples: Educational institutions, scholarships.

Related Guides

D. Perquisites of a Trust:

  • Asset Protection: Trusts offer a secure way to protect assets from creditors and legal claims.
  • Estate Planning: Trusts facilitate the smooth transfer of assets to beneficiaries, avoiding probate and reducing estate taxes.
  • Tax Benefits: Trusts engaged in charitable activities can avail tax exemptions under relevant provisions of the tax laws.
  • Continuity: Trusts can continue to operate perpetually, ensuring long-term benefits for beneficiaries even after the trustor’s demise.
  • Flexibility: Trusts can be customized to meet specific objectives and conditions set by the trustor.
  • Confidentiality: Trusts provide a level of privacy as they are not required to publicly disclose assets and beneficiaries.
  • Charitable Activities: Trusts can be established to support charitable, educational, or religious purposes, contributing to social welfare.

E. Advantages:

  1. Tax exemptions
  2. Asset protection
  3. Perpetual existence
  4. Flexibility
  5. Confidentiality

F. Disadvantages:

  1. Irrevocability
  2. Complexity
  3. Cost
  4. Regulatory compliance
  5. Initial setup effort
  6. Limited beneficiary control

G. Components of a Trust Deed:

  1. Name of the Trust: Clearly states the name of the trust being established.
  2. Date of Establishment: Specifies the date when the trust deed is executed.
  3. Trustor/Settlor: Identifies the person or entity creating the trust and transferring assets.
  4. Trustee: Names the individual or entity responsible for managing the trust assets.
  5. Beneficiaries: Lists the individuals or groups who will benefit from the trust.
  6. Trust Property: Describes the assets or property being transferred to the trust.
  7. Objectives/Purposes: Outlines the goals and purposes for which the trust is established.
  8. Powers and Duties of the Trustee: Defines the authority and responsibilities of the trustee.
  9. Distribution of Trust Property: Specifies how the trust assets will be distributed to beneficiaries.
  10. Revocation and Amendment: States whether the trust can be revoked or amended, and under what circumstances.
  11. Governing Law: Indicates the jurisdiction and laws governing the trust.
  12. Duration/Perpetuity: Specifies whether the trust is established for a fixed term or in perpetuity.
  13. Miscellaneous Provisions: Includes any additional clauses or provisions relevant to the trust.
  14. Signatures: Requires signatures of the trustor, trustee, and witnesses to validate the trust deed.

H. Eligibility Criteria for Establishing a Trust:

  1. Legal Capacity: Any individual of sound mind, competent to contract, or a legal entity capable of holding property can establish a trust.
  2. Intent: The trustor must have a genuine intention to create a trust for lawful purposes.
  3. Trust Property: The trustor must possess the legal capacity to transfer property or assets to the trust.
  4. Beneficiaries: Trusts must be established for the benefit of identifiable beneficiaries or a charitable purpose recognized by law.
  5. Compliance with Law: The trust must comply with the legal requirements and formalities prescribed by the applicable laws governing trusts.
  6. Non-Contravention of Public Policy: The trust’s objectives and activities must not contravene public policy or be unlawful.
  7. Registration (for Public Trusts): If establishing a public trust, compliance with registration requirements under relevant state laws is necessary.

I.Frequently Asked Questions (FAQs) about Trusts:

 A trust is a legal arrangement where one party (the trustor) transfers assets to another party (the trustee) to hold and manage for the benefit of a third party (the beneficiary) or for a specific purpose.

 Trusts can be broadly classified into private trusts and public trusts. Private trusts are created for the benefit of specific individuals or groups, while public trusts are established for the benefit of the general public or a section thereof.

 Benefits of trusts include asset protection, estate planning facilitation, tax exemptions for charitable trusts, continuity of benefits, flexibility in asset management, and confidentiality.

 Setting up a trust involves drafting a trust deed specifying the terms and conditions of the trust, appointing trustees, transferring assets to the trust, and complying with legal formalities such as registration (for public trusts).

Almost any type of asset can be placed in a trust, including real estate, cash, securities, business interests, intellectual property, and personal property.

Trusts can be either revocable or irrevocable. Revocable trusts allow the trustor to modify or revoke the trust during their lifetime, while irrevocable trusts cannot be modified or revoked once established

 Tax implications vary depending on the type of trust and its purpose. Charitable trusts may qualify for tax exemptions under relevant tax laws, while other trusts may be subject to income tax, gift tax, or estate tax.

· Trustees are responsible for administering trusts, managing trust assets, distributing income or principal to beneficiaries according to the terms of the trust deed, and complying with legal and fiduciary duties.

Compliance requirements include annual filings, audits (for public trusts), income tax returns, and adherence to legal and regulatory obligations specified by the relevant trust laws.

 Depending on the terms of the trust deed and applicable laws, trusts may be dissolved by court order, mutual agreement of the parties involved, fulfillment of the trust’s purpose, or other specified circumstances.

J. Detailed list of documents required for trust registration

  1. Trust Deed:
  • The primary document outlining the terms, conditions, and objectives of the trust.
  • Includes details such as the names of the trustor, trustee(s), beneficiaries, and description of the trust property.
  1. Identity Proof of Trustees and Settlor:
  • Copies of identity documents such as Aadhar card, PAN card, passport, or driver’s license.
  • Identity proof of all trustees and the trustor/settlor.
  1. Address Proof of Trustees and Settlor:
  • Copies of address documents such as Aadhar card, passport, utility bills, or bank statements.
  • Address proof of all trustees and the trustor/settlor.
  1. Passport Size Photographs:
  • Recent passport-size photographs of all trustees and the trustor/settlor.
  • Typically, two photographs for each individual.
  1. Proof of Trust Property:
  • Documents proving ownership or title of the trust property.
  • Examples include property deeds, sale deeds, gift deeds, or any relevant property documents.
  1. Affidavit:
  • An affidavit signed by the trustor and the trustees.
  • States that the information provided and documents submitted are true and accurate to the best of their knowledge.
  1. Trustee Declaration:
  • Declaration forms signed by all trustees.
  • Acknowledges their consent to act as trustees and their understanding of their responsibilities.
  1. Miscellaneous Documents:
  • Any other documents as required by the relevant authorities or specified under the trust registration laws.
  • This may include additional forms, declarations, or affidavits depending on local regulations.
Client Portal
Client Portal