Trust Registration is the formal procedure for establishing a legally recognized trust entity. It involves drafting a trust deed, which details the trust’s purpose, governance structure, and operational rules. The process includes selecting a unique name for the trust, filing the necessary documents with relevant government authorities, and obtaining essential identifiers such as a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN). Additionally, opening a dedicated bank account is crucial for managing trust funds. Proper registration ensures the trust is legally compliant and capable of managing assets, pursuing charitable activities, and receiving donations while adhering to regulatory requirements.
Procedure for Trust Registration
Name Selection
First of all decide on appropriate and unique name for Trust. The name should not violate or infringes someone else name or trademark.
Deed Draft
The next step is to draft the trust deed having details of all the parties to the deed like the author of the deed, trustee and the beneficiary.
Submission for Registration
After trust deed preparation, it is mandatory to do the registration of this document.
Registration Process
Registration Process After submission of form with all the document ,trust is registered and original registered copy of the Trust Deed is returned.
PAN, TAN and Bank A/C
After successful registration of the trust, apply for allotment of PAN and TAN number and bank A/C for the trust.
Documents Required for Trust Registration
Below is the list of documents required for the Trust registration process
- Trust Deed on proper non-judicial Stamp paper value
- Two passport size Photographs of all Partners each
- PAN Card of Each Partner
- Identity Proof of each Partner
- Address Proof of each Partner
- Signed Declaration (s) from all Partners
Documentation required for the registered address of Trust
- Proof of Registered Office
- Latest Utility Bill as proof must be
- If property is rented then No objection certificate of the owner.
Benefits of Registering Trust
Registering a trust offers several significant benefits:
Legal Recognition: Registration grants the trust formal legal status, enabling it to operate as a distinct legal entity. This recognition is essential for managing assets, entering into contracts, and conducting activities in compliance with the law.
Tax Advantages: Registered trusts may qualify for tax benefits and exemptions, such as deductions on donations received and exemptions on income generated for charitable purposes, depending on jurisdictional regulations.
Enhanced Credibility: A registered trust gains credibility and trust from donors, beneficiaries, and the public. It demonstrates commitment to transparency and adherence to legal standards.
Access to Funding: With legal status, a trust can more effectively apply for grants, donations, and other forms of financial support from government agencies, foundations, and private donors.
Asset Protection: Registration helps in safeguarding trust assets, ensuring they are managed according to the trust deed and protected from personal liabilities of trustees.
Governance and Structure: A registered trust benefits from a clear governance structure outlined in the trust deed, which helps in organizing its operations and making decision-making processes more effective.
Legal and Financial Compliance: Registration ensures compliance with legal requirements, which can prevent potential legal issues and provide a framework for proper financial management and reporting.
Overall, registering a trust establishes a solid foundation for achieving its objectives, managing resources efficiently, and maintaining legal and financial integrity.