Trust registration is the legal process of formally establishing a trust by registering a trust deed with the relevant government authority, typically the Registrar of Trusts or the office of the Inspector General of Registration (IGR), depending on the state. A trust is an arrangement where a settlor (trustor) transfers property or assets to trustees, who manage these assets for the benefit of specified beneficiaries. In India, private trusts are governed by the Indian Trusts Act, 1882, while public trusts (charitable or religious) are generally regulated by state-specific laws.    

Types of Trusts in India

Trusts in India are primarily classified based on their purpose, beneficiaries, and legal framework.

The main types are:

Private Trusts

• Purpose: Created for the benefit of specific individuals or families.

• Beneficiaries: Clearly identified persons or groups, such as relatives or family members.

• Governing Law: Indian Trusts Act, 1882.

• Examples: Family trusts for asset protection, succession planning, or welfare of children

Public Trusts

• Purpose: Established for the benefit of the general public or a large, unidentifiable section of society.

• Beneficiaries: Uncertain and not specifically known; includes the public at large.

• Governing Law: Regulated by state-specific public trust acts.

• Examples: Charitable trusts for education, healthcare, religious or social welfare.

Public-cum-Private Trusts

• Purpose: Serve both public and private interests.

• Beneficiaries: Partly specific individuals and partly the general public.

• Examples: A trust that provides scholarships to family members and also funds public education initiatives.

Charitable Trusts

• Purpose: Specifically created for charitable purposes such as relief of poverty, education, medical relief, or advancement of any other object of general public utility.

• Tax Benefits: Eligible for tax exemptions under the Income Tax Act.

Special Trusts

• Purpose: Formed for a specific, limited objective, such as maintaining a park or caring for a pet.

• Duration: Usually temporary and dissolved after fulfilling their purpose.

Implied and Express Trusts

• Express Trusts: Created by a clear, formal trust deed specifying terms, trustees, and beneficiaries.

• Implied Trusts: Arise from circumstances or conduct, even without a formal trust deed.

Summary Table

What are the main differences between private and public trusts

Why is Trust Registration Important?

Trust registration is important because it provides a trust with formal legal recognition, allowing it to operate as a distinct legal entity separate from its founders and trustees. This legal status enables the trust to own property, enter into contracts, sue, and be sued in its own name, which is essential for legitimacy and effective functioning. Registration also unlocks significant tax benefits, such as exemptions under Sections 12A and 80G of the Income Tax Act, making the trust more attractive to donors and reducing its tax liabilities.

Documents Required for Trust Registration (IGR)

To register a trust with the Inspector General of Registration (IGR) or the Registrar of Trusts in India, 

The following documents are typically required:

• Trust Deed: The primary and most important document, drafted on non-judicial stamp paper of appropriate value (varies by state). The trust deed should clearly state the objectives, rules, and management structure of the trust.

• PAN Card of Trustees and Settlor: Self-attested copies of the PAN cards of all trustees and the settlor (the person creating the trust).

• Identity Proof of Trustees and Settlor: Aadhaar card, Voter ID, Passport, or Driving License for all trustees and the settlor.

• Address Proof of Trustees and Settlor: Recent utility bills, Aadhaar card, Voter ID, Passport, or Driving License for all trustees and the settlor.

• Photographs: Recent passport-size color photographs of all trustees and the settlor.

• Proof of Registered Office Address: Ownership document (if owned) or rent agreement/utility bill (if rented), along with a No Objection Certificate (NOC) from the property owner if the premises are rented.

• Trust PAN Card: PAN card in the name of the trust (can be applied for after trust deed execution).

• Objective Statement: A clear statement of the trust’s objectives and purpose, as outlined in the trust deed.

• Details of Trustees and Settlor: Occupation, designation, and relationship among trustees, as required in the trust deed.

How to Register a Trust with IGR – Simple Process

• 1. Choose the Name of the Trust

Select a unique name for your trust that complies with relevant laws, such as the Trade Marks Act and Emblems and Names Act.

• 2. Draft the Trust Deed and Memorandum of Association (MOA)

Prepare a trust deed on non-judicial stamp paper (stamp duty varies by state) and an MOA outlining the trust’s objectives, details of trustees, and rules for management.

The trust deed should include:

• Name and address of the trust

• Details of settlor, trustees, and beneficiaries

• Objectives and rules of the trust

• Powers and duties of trustees

• 3. Gather Required Documents

Collect all necessary documents, such as:

• Trust Deed (original and copies)

• Identity and address proofs of settlor and trustees (Aadhaar, PAN, passport, etc.)

• Passport-size photographs of all parties

• Proof of registered office address (utility bill, rent agreement, NOC from owner if rented)

• Written consent from each trustee

• 4. Submit Application and Documents

File the application along with the trust deed and supporting documents at the jurisdictional Sub-Registrar or Registrar of Trusts. In some states, part of the process may be online, but most require a physical visit.

• 5. Pay Stamp Duty and Registration Fees

Pay the required stamp duty (as per state rates) and registration fees. Payment can often be made online or at the registrar’s office.

• 6. Trust Deed Execution and Registration

The settlor and at least two witnesses must be present for the execution of the trust deed at the registrar’s office. The registrar will verify the documents and, if satisfied, register the trust deed and return a certified copy.

• 7. Obtain Trust Registration Certificate

Once registration is complete, the registrar issues a Trust Registration Certificate, officially recognizing the trust.

• 8. Post-Registration Steps

• Apply for a PAN card for the trust

• Open a bank account in the trust’s name

• Apply for 12A and 80G registrations (if seeking tax exemptions)

Why Choose auditfiling for Trust Registration?

Choose AuditFiling for seamless and expert trust registration services. Our experienced team ensures full legal compliance, manages the entire registration process, and helps you secure valuable tax benefits like 12A and 80G certifications. With AuditFiling, your trust gains enhanced credibility, access to funding, asset protection, and long-term stability. We also provide ongoing compliance support, making it easy for you to focus on your mission while we handle the complexities of registration and legal formalities.