Can a nri or foreign resident indian can become trustee in indian trust (2024)

FAQs

Can a nri or foreign resident indian can become trustee in indian trust? ›

Indian courts have held that a non resident cannot be a trustee of an Indian resident trust unless he is domiciled in India. The principle behind this is that the trustee at all times must be within the reach of Indian Courts in order to ensure the enforcement of the terms of the trust.

Every person capable of holding property may be a trustee; but, where the trust involves the exercise of discretion, he cannot execute it unless he is competent to contract. No one bound to accept trust.

Beneficiaries can be residents and non-residents. A Trustee is appointed to manage the assets. He will manage the property and use the property for the benefit of the beneficiaries.

1) Yes, you can still continue to be be trustee . 2) As you are holding OCI cards you do not have to seek multiple visa to visit India. 3) As per section of Indian Trust Act, 1882 any person capable and competent to enter into contract can become a trustee.

FEMA Rules to Create Private Family Trust for NRIs

RBI approval is needed for this. An NRI citizen can transfer non-repatriable assets or funds outside India to a maximum limit of $1 million per year. A trustee can be a resident or a nonresident.

In general, it's unadvisable to name a non-U.S. citizen as successor trustee for your trust. Even if your spouse is your preferred successor trustee, if they are not a U.S. citizen, you're placing them in a potential terrible tax situation both during your lifetime and afterward.

Trustees generally need to be over the age of 18, or over the age of 16 if your organisation is a Charitable Incorporated Organisation (CIO). They cannot have been previously disqualified as a trustee or company director, be an undischarged bankrupt or have certain unspent criminal convictions.

A non-citizen can form a trust in California but will need significant legal advice on the tax consequences. Both California and the United States have some special laws for taxing trusts. The amount of tax could vary widely depending on who the trustee is, and several other factors.

Trusts can have multiple beneficiaries, including the trustee. Naming a non-US citizen as a beneficiary of a Trust could have consequences for inheritance or income-tax. For one, selecting a foreign citizen as a beneficiary can expose the Trust to increased tax liability.

Naming a Non-US Citizen as Beneficiary

Naming a non-US citizen as a beneficiary of a trust can expose the trust to increased tax liability or could result in double taxation. In addition, there may be complexities of transferring or making distributions to a non-US trustee depending on the country of citizenship.

Do trustees get paid in India? ›

Section 50 of this Act provides that Trustees cannot be paid remuneration. However it may be noted that Indian Trust Act 1882 does not apply to public charitable or religious trust. The provision of section 50 is provided as under: “Trustee may not charge for services.

A: OCI card holders can purchase residential and commercial properties in India. But they are not permitted to purchase agricultural land, including farmland or any kind of plantation property. Q: Can a foreign national of non-Indian origin resident outside India purchase immovable property in India?

The objective of the trust– You must be clear on whether the objective of your trust is religious or charitable. Formation of the trust– A minimum of two trustees are required to form a trust. No restriction is imposed on the maximum number of trustees.

Indian courts have held that a non resident cannot be a trustee of an Indian resident trust unless he is domiciled in India. The principle behind this is that the trustee at all times must be within the reach of Indian Courts in order to ensure the enforcement of the terms of the trust.

Discretionary Trusts

Thus, such a trust which is popularly known as a “discretionary trust”, is chargeable to income tax at the maximum marginal rate, i.e., 30%. However, there are certain exceptions to the above rule of charging the income of a discretionary trust at the maximum marginal rate.

There are no legal impediments under the Indian Succession Act, 1925 against a Non-Resident Indian from inheriting property however, in the event of the deceased person having properties in India but not having a domicile in India, the same shall be governed by the laws of the country in which the deceased was ...

Indian courts have held that a non resident cannot be a trustee of an Indian resident trust unless he is domiciled in India. The principle behind this is that the trustee at all times must be within the reach of Indian Courts in order to ensure the enforcement of the terms of the trust.

When using a private trust in India, it is not unusual for the trustee to also be a beneficiary of such trust. There is no embargo under the Indian Trusts Act, 1882, which prohibits an individual to be a trustee as well as beneficiary.

trustees can draw a “reasonable” compensation from the trust fund for the services they provide to the trust. Trustee who is a full time employee of the trust can draw reasonable salary as per law.

As per Section 10 of the Indian Trusts Act, any person who is capable of holding property can be appointed as a trustee. A person is deemed to have the capacity to hold property, if such a person is capable of administering the property effectively and efficiently with ordinary prudence.