A trust can be for the benefit of a closed group or persons, known as a Private Trust or for the public at large, known as a Public Trust. We advise and assist in Trust Registration, which is mandatory anywhere in India. Call us now.
The Indian Trusts Act, 1882, defines a trust as an obligation, annexed by the ownership of property, arising of a confidence reposed in the owner and accepted him, for the benefit of another owner or another person known as its beneficiary. In simple words, the owner of the property / assets, called the ‘author of the trust’, entitles its ‘trustee’ to hold his property / assets for the benefits of other authors and beneficiaries. For this purpose, we can say that the ‘author of the trust’ has reposed his confidence on the Trustee. The beneficiary’s rights against the trustee as the owner of the property / assets is termed as his ‘beneficial interest’ in the Trust.
The first step of trust registration online starts with the drafting of a trust deed. The trust deed is to be drafted on an appropriate non-judicial stamp paper, the cost of which varies across different states in India. Additionally, the trust deed must be stamped for which the stamp duty charges vary for different states in India. Besides a valid trust deed, the necessary prerequisites for Trust formation also include a legitimate objective, beneficiaries based on the type of trust, and the minimum number of trustees as prescribed by law. Follow the table below for detailed information on all such necessary prerequisites of Trust Registration in India.
The NGO Trust registration online is done with the Registrar of Trusts in India. While a private trust is registered under the Indian Trusts Act, 1882, a public trust is registered under the Trust Act specific to the state where it is getting established. The entire process of Trust Registration is centered around the registration of the Trust Deed, drafted and signed by the author of the trust in the presence of the registrar and 2 other witnesses. A detailed stepwise procedure for the registration of Trusts in India has been mentioned below.
The documents required for Trust Registration can be categorized into the Trust Deed, the documents of all signatories to the Trust Deed, and the documents of the principal place or the registered address of the Trust. An elaborate list of all the documents required for Trust Registration in India have been mentioned in the table below. A failure to produce any of these documents during the process of Trust registration may result in the rejection of the entire application of registration. Therefore, it is advised that the process of documentation must be executed with utmost carefulness and sincerity.
| Documents of the Trustee & Settlers of the Trust | Documents of the Business Premises |
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Before proceeding with the registration of a trust, it is important to consider the associated costs involved. While the exact expenses can vary based on jurisdiction and other factors, the following aspects highlight some of the common costs to consider for trust registration.
Trust registration safeguards your assets from risks like lawsuits, creditor claims, and financial downturns. Placing your assets in a trust can help reduce loss in unforeseen circumstances.
Trusts being non-profit entities are subject to many tax exemptions under the Income Tax Act. The exact provisions may vary based on the type of trust and jurisdiction of registration
Registering a trust provides a level of privacy and confidentiality. Unlike public entities, trusts are not required to disclose beneficiaries or details about the trust's activities publicly.
Trusts are excellent tools for succession planning. By transferring assets into a trust, you can outline specific instructions for their distribution to beneficiaries.
Charitable trusts promote philanthropic endeavors to make a positive impact on society. You can enjoy tax benefits on your personal contributions to registered trusts.
Trusts can exist in perpetuity, allowing you to create a lasting legacy. Through trust registration, you can ensure the continuity of your objectives beyond your lifetime.
Ensuring compliance with Trust Registration laws is extremely important when establishing and administering a trust. Failure to adhere to these laws can lead to significant adverse consequences as discussed below :
