Keynotes on Trust Registration
Trust Registration in 10 to 15 days.
Completely online service - No physical presence required
No minimum capital requirement
Trust registration service needs necessary documents like trust deed and rental agreement. One Click Business Solutions Private Limited has experienced professionals who are well-versed with trust registration online procedure in order to accelerate registration process.
We have experts to provide you with assistance with complete process to form your trust while taking care of any legal hazards. You may contact us to know more about our cost-effective trust registration fees while enrolling your start-ups.
Public trust is known as the easiest way to start a non-governmental organization like NGO. A trust acts with one of its social objectives to remove poverty. If you want to incorporate your trust online without any legal issues, it is best to contact us as soon as possible. We will help you to process your trust registration documents properly and we also guide you further to establish the start-ups.
Get in touch with us to know the perfect procedure of trust registration service. At One Click Business Solutions Private Limited, we are committed to offer business services in quick turnaround time. We work only with qualified and experienced professionals to ensure the best quality with cost-effective price.
So what are waiting for! It's time for you to commence your start-ups.
According to Indian Trust Act, a trust is defined as "A trust is made when the author of the trust indicates with realistic faith by any of the following:
An intention to make a trust as par his will
The aim of the trust
The trust property and transfer of the same to the trustee (unless the trust is stated by will or the author himself to be the trustee).
Trusts are classified into two categories:
Public Trust – Public trust is one whose beneficiaries include common public in a large or small part. A public trust is categorized under:
Public Charitable Trust
Public Religious Trust
Public trust is called non profit charitable organization or non-governmental organization (NGO).
Private Trust – A private trust is one whose beneficiaries are families and individuals. It is cauterized in the following:
Private specific trust / Private Discretionary trust – Both beneficiaries and shares are determined
Both or either of the beneficiaries and their share is indeterminate
A trust can be a mix of both and called Public-cum-Private trusts. A part of their income is used for the promotion of public welfare and other part is obtained by an individual. The part of income going to a person is accessible as private while the part used for public welfare is entitled for exemption of tax under Section 11. The trust needs to be created before 01/04/1962 which is before start of the income tax act, 1961. Public-cum-private trusts set up on or after the date cannot obtain tax exemption under section 11.
Let us know about the basic information about a trust and a few terms related to it:
Trustee – The individual accepting the confidence revealed or stated by the settler or author is called Trustee. Unlike societies, some or all of the trustees are related closely. Following can be trustee as par the Indian Trust Act:
An individual who can hold property where the trust includes the task of judgment, he cannot do it unless he is capable to contract.
Not any bound for accepting trust
Signal to accept with realistic certainty by any act or word of the trustee
The intended trustee may disclaim it within a reasonable time. Such disclaimer will restrict the trust property from him.
A disclaimer by one of the two or other co-trustees moves the trust property to other or others. It makes him or them sole trustee or trustees from the date of set up of the trust.
A trustee requires satisfying the purpose of the trust while following rules of the settler mentioned at the time of establishment of the trust with an exemption for modifying by the approval of all other trustees.
A deed can be titled by a trustee. He can reimburse the expenditure, give decrees, settle accounts etc. However a trustee cannot give up after offering acceptance and he cannot use trust property for his own profit.
Author of Trust – An individual declaring the confidence is known as settler or author of a trust. Under the Indian Trust Act, an individual capable to contract with approval of a principal civil court or original jurisdiction by or on behalf of a minor can make a trust. It subjects to the case of law for the time being as to the conditions and extent to which the trust's author may show the trust property.
Beneficiaries – Individual who get benefit by the confidence reposed by settler or author and approved by the trustee are known as beneficiaries. Under the Indian Trust Act, beneficiary can be any individual who can hold property. A proposed beneficiary may renounce his interest according to the trust by the disclaimer which is addressed to the trustee or by setting up with notice of the trust, a claim contradictory therewith. Beneficiaries have the authority to profit, rents, and particular execution. They can ask for the copies of trust's instruments, any act of duty etc.
Trust Property – Trust property or Trust money is called subject matter of a trust. Instrument of trust refers to an instrument by which declaration of trust took place.
Trust Deed – A memorandum is required to be created before registering a trust. This memorandum of understanding is known as the trust deed. This is the document includes crucial things with reasonable assurance. They are as follows:
Aim of the trust
The intention of the part of the settler or author to make a trust
Transfer of the property to the trustee
This is necessary instrument of the trust. In includes declaration of the objectives, purposes and methods of management. Trust deed includes the legal status of a trust which is compulsory if the property is involved especially land and building to offer a prima facie proof.
A public charitable trust needs to be registered with the office of the charity commissioner with authority over its jurisdiction.
For completing trust registration procedure, it is required to follow a number of steps. Let us know them:
Step 1 – Select a suitable name for the trust. This includes the core step to register a trust. Proposed name should not include any suggestion for any type of support by any state government or the government of India. It should follow the provisions of Emblems and Names Act, 1950 and should not contain any of the restricted lists of names. However it is possible to use such names that are already registered in the registrar office as a trust. The proposed name may not violate any of the above mentioned rules but it may be refused by the registrar at the Registrar Office for registering the trust. In this circumstance, a complaint can be filed with the higher authorities and proper action will be taken.
Step 2 – Author/ Settler and Trustees of the intended trust should be determined. There is not any clear rule regarding the number of authors or settlers. It depends on the decision of the Sub-Registrar at the Registrar Office. Traditionally there is one settler or author in most cases. At least two trustees are essential and there is not any maximum limit. Author / Settler are not Trustees generally. It is based on the will, choice and understanding of other Trustees. In order to become a Trustee, educational qualification is not necessary. An illiterate individual can become a trustee. In case of female, 18 years is the minimum age and 19 years in case of male. Sometimes an average of both the minimum age which is 19.5 is considered for the process. A trustee needs to be a resident of Republic of India. NRIs, OCI card holders and Foreigners residing in other countries more than 6 months cannot be a member of a trust.
Step 3 – A Memorandum of Association and Rules & Regulations of the trust should be made. This is called Trust deed which is a must for your trust and also a legal evidence of the same. The trust deed includes different clauses which are as follows:
Settler and Trustee Clause
Object Clause and Beneficiaries
Registered Office Clause
General Body Member Clause
A table includes name, address and occupation of the members with their signatures must be made in the Memorandum of Association. Rules and Regulations section has the following Clauses:
Committee / Governing Body Clause
Legal Process such as replacement, appointment of a trustee, their duties, authorities, rights etc.
An intention to separate trust property upon the trustee(s) (The intention must be written in simple language and confidence)
Property will be separated upon the trustees(s) under the trust to provide its beneficiaries with benefits (under Indian Registration Act, 1908, Section 21, a deed of trust related to immovable property is a must for trust registration. The deed should include a description of property enough to recognize it)
ByLaws of the Trust – Each and every rule should be mentioned that are applicable to the trust point wise. This involves Sections of Income Tax act that are applicable. Indian Trust Act and other laws are applicable to administer and run the working of the trust. All the procedures and conditions should be mentioned clearly. That should be followed properly while opening and operating a bank account. These bylaws are incorporated in the trust deed. Accurate process about the changes, addition or removal of trustees needs to be established. The trust deed is incomplete with inclusion of bylaws. Due to this, experienced professionals should be hired that are having experience to make trust deeds. Issues related to proving legal status of the trust can be there in the future without an accurate trust deed.
Step 4 – File all the documents that are needed at the time of submission. A trust deed is important for that. Trusts are permanent unless it is stated in the deed. Once a trust is established cannot be wound up.
The essential elements of the trust deed are as follows:
Names and address of the trustees
Name and address of the Author / Settler of the Trust
Minimum number is 2 while there is not any maximum limit of trustees. But it is important to determine the maximum number that the trust can have. All the trustees govern the trust together and they are known as Board of Trustees.
Name of the trust
Purpose to form the trust
Address of the trust's registered office
Rules and regulations governing the trust
Aims of the trust
Tenure of the trustees is required to be given in the deed. This is not a must to follow electoral procedure while appointing the trustees
Information about the bank and branch where a bank account is to be opened with
Responsibilities and posts of each should be determined in the trust deed
Board of Trustees can also have different designations for trustees like managing trustee and chairperson.
Date of execution of the trust deed
Trustees cannot draw any remuneration from fund of the trust but they will get compensation for their professional services to the trust. The same is to be determined in the deed.
Ways through which income should be distributed among beneficiaries or used in execution of projects or programs for their welfare.
Details of the trust funds, created by the Settler with movable and immovable property included in the trust fund. Information about the activities and sources are also there through which income can be obtained and deposited in the fund.
Number of meetings to be held every year and certain conditions about the same are compulsory for the trustees to participate
Duties, rights and limitations of the trustees
Conditions under which a trustee will expire
Processes for changing, varying or any modification of any Clause in the trust deed
The trust deed is to be made on a stamp paper whose worth should be of certain percentage of the whole value of the property of the trust. This percentage differs state to state.
Things to remember - Verbal or written consent of all the members is essential. Laws regarding the physical presence of trustees vary in different states. Physical presence of settler is essential throughout India. In some states, trustees need to submit their original photo Ids along with self attested copies.
Step 5 – Trust deed must be submitted along with attested copies with the registrar. The settler must sign on the photocopy of the trust deed on every page. At the time of registration, 2 witnesses and the settler are needed to be present along with their ID proof (Both original and self attested copies). Some states demand physical presence of the Trustees and some other demand their written consent with ID proofs (Both original and self attested copies) only.
Step 6 – The photocopy is retained by the registrar and original registered copy of the trust deed is returned by him.
Step 7 – Once all the necessary documents are submitted and all formalities are completed, at least 7 working days are required to get registration certificate. This is not stated in any rule but the registrar may want to verify the registered office address by sending an official letter at the place in order to do verification.
Request letter for registration of a society
2 copy of Memorandum of Association including list of founder members of society and list of proposed governing body. All are to be signed by all members
2 sets of Rules and Regulations made for the functioning of the society
Affidavits on Rs.10/- stamp paper from Secretary Society or President about the name or title of the society
Photocopy of residence proof of all members
Evidence of ownership of the society registered office and no objection certificate on ten rupees stamp paper
Photocopy of evidence of identification of all society
Most important feature of Trust Registration includes those who want to include family members also in Trust can apply for Trust Registration
To improve academic and social circumstance of the people, cultural, better governance, peace, work for democracy, cooperation and justice
Support the people to make an improved society
Contribution of effort for rehabilitation of beggars in India
To make programs that facilitates education