To obtain the benefits of a Trust, it needs to meet certain prerequisites, and the registration process is one of the prerequisites. Are you planning to register the trust?
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Auriga Accounting has a team of registration experts who can provide complete guidance to register your TRUST.
Our team of experts will get in touch with you and collect all necessary documents and details
We fill out and file your application for registration
Your TRUST is registered
Auriga Accounting has a team of registration experts who can provide complete guidance to register your TRUST .
Our team of experts will get in touch with you and collect all necessary documents and details
We fill out and file your application for registration
Your TRUST is registered
Trusts are established through a trust deed, managed by trustees, and primarily focus on managing assets for beneficiaries’ benefit. They often involve charitable or private purposes.
Section 8 Companies (under the Companies Act) are incorporated entities with limited liability and operate for promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment, or any other similar objective. They must apply any profits towards promoting their objectives.
Societies are formed by a group of individuals for charitable, literary, scientific, or political purposes. Governed by Societies Registration Act, they operate through elected members and have legal status distinct from their members.
A trust is like a container that holds assets, managed by one party (the trustee) for the benefit of another party (the beneficiary). The person who creates the trust (the grantor) transfers ownership of assets into the trust, outlining how they should be managed and distributed according to specific terms and conditions. Trusts are used for various purposes, such as estate planning, asset protection, and charitable giving. They provide a way to safeguard assets, ensure they’re used for intended purposes, and allow for the efficient transfer of wealth while minimizing taxes and avoiding probate.
A trust is a legal arrangement where a person or entity (known as the “settlor” or “grantor”) transfers ownership of assets to another person or entity (known as the “trustee”) for the benefit of one or more individuals or organizations (known as the “beneficiaries”). The trustee holds and manages the assets on behalf of the beneficiaries according to the terms and conditions specified in a legal document called the trust deed or trust agreement.
Settlor/Grantor: The settlor, also known as the grantor or creator, is the person who establishes the trust and transfers assets into it. Any individual or legal entity capable of entering into a contract can act as a settlor.
Trustees: Trustees are responsible for managing the trust’s assets and carrying out the instructions outlined by the settlor. Typically, individuals or corporate entities can serve as trustees. However, some jurisdictions may have specific regulations regarding who can act as a trustee, such as disqualifying certain individuals or entities with conflicts of interest.
Beneficiaries: Beneficiaries are the individuals or entities designated to receive benefits from the trust. Beneficiaries can include individuals, organizations, or even other trusts. The eligibility of beneficiaries can be defined by the settlor in the trust document.
Asset Protection: Trusts can provide asset protection by separating the trust assets from the personal assets of the settlor and beneficiaries. This can safeguard the assets from creditors, lawsuits, or other potential risks.
Estate Planning: Trusts are commonly used in estate planning to facilitate the smooth transfer of assets to beneficiaries. They can help avoid probate, reduce estate taxes, and provide greater control over how and when the assets are distributed.
Privacy: Unlike wills, which become public upon probate, trusts offer a higher level of privacy. Trust documents generally remain private, allowing the settlor’s wishes and the trust’s details to remain confidential.
Flexibility in Asset Management: Trusts provide flexibility in managing and distributing assets. The settlor can establish specific instructions and conditions for the distribution of assets, such as age restrictions, educational milestones, or purposes for which the assets should be used.
Continuity of Assets: Trusts can ensure the continuity of asset management and protection even in the event of the settlor’s incapacity or death. This can provide stability and peace of mind for the beneficiaries.
Charitable Giving: Trusts can be utilized for charitable giving and philanthropic endeavors. Charitable trusts allow individuals to support causes they care about while enjoying certain tax benefits.
Avoidance of Probate: One of the significant advantages of trusts is the ability to avoid or minimize probate. Assets held in a trust generally do not go through the probate process, which can save time, costs, and potential disputes.
Choose a unique name for the Trust – Your first task is to give a proper name to your Trust. The online registration of Trust is only possible if the name you choose for your Trust is reliable and as per the standards of the government of India.
To form a Trust, your name should not contravene the Emblems act
The name should not violate the trademark act
The name you choose should be unique
Drafting the Trust Deed
Formulate the bylaws of your Trust and put them inside the trust deed.
Documentation – Gather the documents required for Trust Registration. Make sure all the documents are signed from the get-go.
Online Application filing – To form a trust online, the applicant must file an online application. Go to the official website of Trust Registration in your state and start filling out the application form.
Application Submission – Submit the online application for Trust Registration to the appropriate authority with the requisite documents.
Obtain the Trust Registration Certificate – It is not only the documents and registration that the society registrar assesses. It is also the purpose of your Trust. After the analysis, if the registrar deems you worthy, you will obtain the trust registration certificate.
Not following the rules mentioned in the trust deed is considered a contravention of the provisions of the Trust Registration Act. And thus, you will become liable for civil and criminal penalties.
A Trust must obtain the Tax Deduction Account Number. Not doing so is considered a criminal offence per Section 27BB of the Indian Trust Act, 1882.
Not every Trust is considered to be a Non-Profit Organization. Unless the Trust has the registration under Section 12A of the income tax act, it cannot avail of tax benefits. It means that the Trust is required to furnish the tax returns on time. Not complying with the rules will cause issues for your company.
Auriga Accounting is a team of leading business professionals who are well-versed in the matters of Trust registration. In addition to answering several questions about what is Trust registration certificate and its rules and regulations, we will provide you with the following services
We are India’s leading Trust registration consultant with a Delhi base. We can thoroughly assist you with trust registration in a minimum time.
To register a trust, you typically need to draft a trust deed specifying the trust's objectives, trustees, beneficiaries, and rules. The deed must be signed and executed by the settlor and trustees. It should then be registered with the local Sub-Registrar or the office of the Charity Commissioner, depending on the jurisdiction.
Requirements may vary by location, but generally, you need a trust deed, details of trustees, and compliance with local regulations to register a trust. Consult legal professionals or authorities for specific requirements.
A trust can be formed by an individual (settlor) or a group of individuals (trustees) for a lawful purpose, with defined beneficiaries.
While registration is not compulsory, it provides legal recognition, tax benefits, and increased credibility. Many trusts choose to register for these advantages.
The cost of trust registration varies depending on factors like location, legal fees, and any associated government charges. It's advisable to consult with legal experts for precise cost estimates.
Trusts can be categorized into various types based on their objectives, such as charitable trusts, private trusts, public trusts, religious trusts, and educational trusts, among others.
Registering a private trust involves creating a trust deed specifying its objectives, trustees, beneficiaries, and rules, and then registering it with the appropriate authority as per local laws.
Section 12A of the Income Tax Act in India provides for the registration of trusts and institutions for availing tax exemptions under Section 80G. It's essential for trusts seeking tax benefits.
The number of members in a trust can vary, but there must be a minimum of two trustees. The trust deed may specify the maximum number of trustees, if any.
Benefits of trust registration include legal recognition, tax exemptions, credibility, the ability to hold and manage property, and fulfilling the trust's objectives more effectively.
The best type of trust depends on the specific objectives and purposes you want to achieve. Consult with legal experts to determine the most suitable trust structure for your needs.
Yes, in order to provide protection under Section 11 of the Income-tax Act of 1961, a trust must first register under Section 12AB of that Act.
A public trust can be incorporated in India by a single person who focuses on philanthropic activities and provides relief for poverty medical and educational purposes.
To make the Trust a legal entity, the concerned parties, the trustor and the trustee, must obtain a trust deed. These contracts aid in defining the trustee's authority to administer the settlor's assets.
A family trust normally doesn't pay any taxes on its own revenue. Instead, the beneficiaries receive the income and pay tax at their own rates. The fund's trustee determines who in the family will receive dividends.
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