Article by Manyara Mavis Musara
A trust can be for charitable purposes like an organisational trust or for private benefit like a family trust. The Deeds Registries Act [Chapter 20-05] as amended 2005 governs trusts in Zimbabwe. The parties to the trust are :
- The founder(s)
The founder(s) should have the intention to create a trust and donate assets to the trust. The assets that can be donated include both movable and immovable properties, securities, life policies, businesses and cash. The donations can also come from well-wishers. The founder(s) can also be beneficiaries of the trust but not the sole beneficiary(ies). They can also be trustees but should not be exactly the same founders who are the only trustees for there to be trusteeship.
- The trustees
They should agree to hold office as such and should not have a criminal record involving dishonesty. At least three(3) trustees are ideal and an odd number is preferred for voting purposes. The trustees administer the trust for the benefit of the beneficiary(ies) and should always act in good faith in the interests of the beneficiary(ies). The work is usually done on a voluntary basis with no compensation
- The beneficiary(ies)
These are the persons or groups of people who are to benefit from the creation of the trust.
All the parties to the trust should be fully described. The name, address and objectives of the trust should also be provided. Please take note that the registration of a Trust requires the services of a registered Notary Public
Benefits of registering a trust In Zimbabwe
- It offers protection of assets from creditors of the founders, trustees and beneficiaries because the creditors will not have a claim over trust assets
- A trust can provide for perpetuity meaning that it will have continuity even if the founder(s) and first trustees are no longer there. The beneficiaries will continue benefiting even to future generations .
- Exemption from some taxes like estate duty.
- A family trust is effective in estate planning as it does away with the costs of estate administration.
- It ensures the protection of loved ones and assets now and in the future.
- It ensures equitable distribution of resources according to the needs of the beneficiaries.
Please take note that this article should not be taken as legal advice but as general information regarding the subject matter. The writer can be contacted at mmusara@mmmlegal.co.zw for more information