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Register Trust in India

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Trust is defined in section 3 of the Trust Act, 1882 as " an obligation annexed to the ownership of property and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the benefit of another or of another and the owner. In simple words it is a transfer of property by the owner to another for the benefit of a third person alongwith or without himself or a declaration by the owner, to hold the property not for himself and another.

PROCEDURE INVOLVED

1. Decide on Details for Registering the Trust

Before you register trust you will need to decide the following:

  1. Name of the trust
  2. Address of the trust
  3. Objects of the trust(charitable or Religious)
  4. One settler of the trust
  5. Two trustees of the trust
  6. Property of the trust-movable or immovable property (normally a small amount of cash/cheque is given to be the initial property of the trust, in order to save on the stamp duty).

2. Prepare a Trust Deed on stamp paper of the requisite value 

Prepare a Trust Deed on stamp paper of the requisite value (8% of the value of property of the trust in Delhi. The rate varies from state to state)

3. Fulfill Requirement for registration of Trust Deed with the Local Registrar under the Indian Trusts Act, 1882

Basic Requirements are:

  1. Trust Deed on stamp paper of requisite value (as stated on point no.2 above)
  2. One passport size photograph & copy of the proof of identity of the settler
  3. One passport size photograph & copy of the proof of identity of each of the two trustees.
  4. One passport size photograph & copy of the proof of identity of each of the two witnesses.
  5. Signature of settler on all the pages of the Trust Deed
  6. Witness by two persons on the Trust Deed.

4. Submission of Documents with Local Registrar

Submit the Trust Deed, along with one Photocopy for registration. The photocopy of the Deed should also contain the signature of settler on all the pages. At the time of registration, the settler & two witnesses are required to be personally present, alongwith their identity proof in the original.

5. Receipt of Acknowledgement

The Registrar retains the photocopy & returns the original registered copy of the Trust Deed.

Register Trust in India-FAQs

1. What are the minimum number of trustees required to set up a trust?

Minimum number of trustees is two. The maximum number of trustees can be mentioned in the Trust Deed. All the trustees are collectively called Board of Trustees.

2. Can a Trust work on Pan India Level?

Yes, it can.

3. Can a trust be wound up?

A trust cannot be wound up if it is not mentioned in the Trust Deed.

4. What is the tenure of trustees and their remunerations?

The trustees are normally for life unless their tenure is mentioned in the Trust Deed. The Trustees cannot draw remuneration from the trust though they can take reasonable compensation for professional services they provide to trust.

5. Can the profit of Trust be distributed amongst its trustees?

No the profits cannot be distributed amongst trustees, it has to be used for the objective mentioned in the Trust Deed.

Register Trust (Charitable) in India

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Register Trust (Charitable) in India

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