Here’s a quick look at the benefits of forming a trust to distribute your wealth to future generations:
Setting up a trust protects your legacy, provides for future generations, and most importantly, safeguards your assets from a variety of threats. Trust provides a way for you to distribute your wealth in a structured and steady fashion to your heirs.
Safeguard your assets: A private family trust can help you safeguard your assets for your family from liabilities and insolvency proceedings.
Flexible distribution: A trust allows you to distribute your assets in the proportion and manner you like (for example, you can provide for the education of minors or time the distribution of wealth by age).
Prevent disputes: A business trust can help prevent succession disputes and ensure business continuity by clearly spelling out the distribution of wealth and assets.
Manage assets of minors: Many beneficiaries, such as minors, may not be able to manage their inheritance. A trust will manage the assets of such beneficiaries till a specific time or during their lifetime.
Succession planning is a complex exercise. JM Financial Services Limited brings its decades of experience and deep financial expertise to help its clients manage and distribute their assets in the best possible manner. Our experts and qualified associates work closely with clients to understand their needs and priorities, guide them through the suitable trust formation processes, help them identify and appoint trustees and executors, assist them in the legalities, and consult them on execution.
FACTBOX
A trust is a contract that allows an individual (trustee) to manage assets on behalf of one or many beneficiaries. Trusts are used to ensure that the assets held by the trust are distributed in the right way to the right beneficiaries.
The documents required for the registration of a trust are:
- Form 10G
- Registration certificate
- Copy of the trust PAN card
- Copy of Utility bill as address proof
- NOC from the owner of the property
- Copy of the trust deed
- Bank passbook transcripts for the past 3 years
- Evidence of the trust’s progress report and activities
To form a trust, you need the following:
- An author or settler of the trust
- Trustee(s)
- Beneficiary or beneficiaries
- Purpose and objectives of the trust
Anyone, including individuals, HUFs, charitable organisations and companies, can create a trust. A trust can even be created on behalf of a minor. To form a trust, the author of the trust must state that the members have an intention to create a trust, define the lawful purpose of the trust, name the beneficiary or beneficiaries of the trust, outline the assets or property of the trust and transfer of the property to the trustees. Usually, a trust is formed by a trust deed, but it can also be formed by a will.
A minimum of two trustees are required to form a trust with no limit on the maximum number.
