- Trusts are governed by Relevant state trust act or Bombay Public Trusts Act.
Who manage the trust?
A trust is an arrangement between 3 parties; one is trustee who controls the property for the benefit of another person who is known as the beneficiary. The person who creates the trust will be known as settlor.div>
How many types of Trust?
There are two type of trust. A public trust generally charitable trust that is created for the benefit of the general public whereas in private trust, benefits are created in favor of particular individual or group of individuals. Those individual will be known as beneficiary.
How many trustees are required to form a trust?
A trust needs a minimum two trustees and no limit for maximum. The board of management comprises the trustees. An application will be filed by trustee to registrar of trust having jurisdiction over the location in which the trust is being to be registered.
Can the trustee also be a beneficiary?
Yes, this statement is correct as a trustee can act as a beneficiary also. A trust's owner may appoint a beneficiary who receives benefits (income and assets) from the trust. Original trustee can be replace by the beneficiary if it seems that trustee is not fit and using his rights in illegal way or violating his legal responsibilities.
Who is the owner of the trust?
To create a trust, the property owner called as settlor who transfers a possession to a person or group called the trustee to control that property. The property will be managed for the benefit of some group of person or an individual person called the beneficiary. The trustee receives compensation or commission for his management role.
.
How the trust will pay taxes on its funds?
In general, any income generates by the trust’s asset then that income will be taxable under income tax act. But if the trust pays any portion of its income to beneficiary, then the trust is eligible to get a deduction for any distributable net income. If trust has any undistributed income then on that income trust will pay taxes.
.svg){kind=icon}
