Trusts Registration
Trusts registration is the process of officially recording a trust with a government authority or registry, depending on the jurisdiction. This process is often required to comply with anti-money laundering (AML) and tax transparency regulations.
- Consultation by Experts
- Trust Deed Drafting
- Application Filing with Trust Registrar
- PAN/ TAN of Trust
- Follow Up with Department
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Table of Content
- What is a Trust?
- Parties Involved in the Trust Registration Process
- Benefits of Trust Registration
- Importance of Trust Registration
- Advantages of Trust Registration
- Documentation for Trust Registration (India)
What is a Trust?
Trusts registration is the process of officially recording a trust with a government authority or registry, depending on the jurisdiction. This process is often required to comply with anti-money laundering (AML) and tax transparency regulations.
A trust is a legal arrangement where a trustee holds and manages assets on behalf of beneficiaries, based on the instructions of a settlor.
Parties Involved in the Trust Registration Process
- Settlor (Grantor) : Creates the trust, funds it, and signs the trust deed.
- Trustee(s): Manages the trust assets and ensures terms are followed.
- Beneficiaries : Individuals or entities who benefit from the trust.
- Legal Advisor : Drafts the trust deed and assists with compliance.
- Registrar / Government Authority : Registers the trust and issues the official certificate.
- Witnesses : Sign the trust deed to validate it (usually two required).
- Chartered Accountant (optional) : Advises on tax and financial matters related to the trust.
Benefits of Trust Registration
- Provides legal recognition to the trust as a separate entity.
- Enables the trust to own property and open bank accounts in its name.
- Offers tax exemptions under Sections 12A and 80G of the Income Tax Act.
- Builds credibility with donors, institutions, and government bodies.
- Allows the trust to apply for government grants and foreign funding.
- Ensures perpetual existence, regardless of changes in trustees.
- Facilitates smooth legal and financial operations.
- Enhances transparency and public confidence in the trust’s activities.
Importance of Trust Registration
1. Legal Recognition
Gives the trust a separate legal identity.
2. Proof of Existence
The trust deed and registration certificate serve as official proof.
3. Tax Benefits
Mandatory for availing income tax exemptions under sections like 12A and 80G.
4. Credibility
Enhances public trust, especially for donations and fundraising.
5. Banking & Transactions
Required for opening bank accounts and conducting financial transactions.
6. Property Ownership
Enables the trust to legally own and manage property in its name.
7. Dispute Resolution
Helps resolve conflicts legally as terms are documented and recognized
FAQs on OPC Registration FAQ's
A trust is a legal arrangement where a person (settlor) transfers assets to trustees to manage for the benefit of beneficiaries.
Yes, for public charitable or religious trusts; private trusts may not require registration unless they deal with immovable property.
The Indian Trusts Act, 1882 governs private trusts; public trusts are governed by state laws.
A minimum of two trustees is generally required.
Yes, family members can be trustees if not restricted by the trust deed.
Yes, the settlor can also act as a trustee.
It’s the primary legal document that outlines the objectives, rules, and functioning of the trust.
Yes, the trust deed must be executed on stamp paper and notarized.
The cost includes stamp duty (varies by state), notary fees, and professional fees if applicable.
Typically 7 to 21 working days, depending on the state and documentation.
Registered trusts may get exemptions under Section 12A, 80G, and other provisions of the Income Tax Act.
Yes, a registered trust can hold, acquire, and transfer property in its name.
Yes, but only according to the terms specified in the original trust deed.
These are provisions under the Income Tax Act allowing income tax exemptions and donor deductions, respectively.
Yes, but it must be registered under FCRA (Foreign Contribution Regulation Act).
Yes, a Permanent Account Number (PAN) is required for tax and banking purposes.
No, but it can engage in activities to support its charitable objectives, not for profit-making.
Yes, by following the process laid out in the trust deed and applicable legal provisions.
Private Trusts (for specific individuals) and Public Trusts (charitable or religious).
Yes, a registered trust can operate across the country unless geographically restricted by its deed.
Related Business Registrations
In addition to registration or incorporation, a business may require other registrations depending on the business activity undertaken. Talk to an Advisor to find out registrations your business may require post registration.
