Trust Deed Format & Clauses Every NGO Founder Should Understand

Structure of a standard Trust Deed

A well-drafted Trust Deed for a Public Charitable Trust in India follows a logical sequence. Here is the standard structure with a brief description of each section:

Preamble and recitals

The preamble identifies the parties and their intent. A standard preamble reads:

"This Trust Deed is executed on this [date] day of [month], [year], at [city], by [Full Name of Settlor], aged [age] years, [occupation], residing at [address] (hereinafter called the "Settlor" or "Author of the Trust"), being desirous of creating a public charitable trust for the purposes hereinafter mentioned…"

The recitals explain the motivation — typically, the Settlor's desire to contribute to a charitable cause in a legally structured manner. Keep recitals concise — one to three paragraphs.

Name and registered office

The Trust name should be distinctive, not likely to be confused with existing trusts or companies, and ideally descriptive of the cause area. Common name formats:

• [Name] Foundation
• [Name] Charitable Trust
• [Name] Society for [Cause]
• [Cause Area] Trust

The registered office clause specifies the full address. This address determines:

• Which Sub-Registrar has jurisdiction for registration
• Which Principal Commissioner of Income Tax handles the RNPO application
• The state law applicable (especially relevant in Maharashtra and Gujarat)

See also: Naming your NGO — rules and restrictions.

Objects clause — the most important clause

The objects clause is reviewed by the Sub-Registrar at registration and by the Income Tax Commissioner at RNPO application. Both look for the same thing: specific, legally valid, charitable purposes.

Structure of a good objects clause

List your primary object first, then ancillary objects that support it. Example structure for an education-focused NGO:

"The objects of the Trust shall be:

1. To establish, maintain, and support free or subsidised educational institutions — schools, coaching centres, libraries, and digital learning centres — for children from economically weaker sections (EWS) and scheduled caste / scheduled tribe communities in the Delhi NCR region.

2. To provide scholarships, educational materials, uniforms, and transport support to EWS students to prevent dropout and ensure continuation of schooling.

3. To train and support schoolteachers working in government and low-fee private schools in pedagogy, digital tools, and inclusive education practices.

4. To conduct research, publish reports, and advocate for policy reforms that improve educational access and quality for marginalised communities in India.

5. To do all such other acts, deeds, and things as may be necessary, incidental, or conducive to the attainment of the above objects."

Notice: specific activity, specific beneficiary group, specific geography, measurable intent. The final catch-all object (item 5) is standard but must not be the primary object.

Trust property clause

The Settlor must transfer some property to create a valid Trust. For a Public Charitable Trust, the initial corpus can be minimal — even ₹1,001 in cash is legally sufficient in most states. The clause reads:

"The Settlor hereby settles upon and transfers to the Trustees, the sum of ₹[amount] (Rupees [amount in words]) in cash as the initial corpus of the Trust, to be held by the Trustees upon the trusts and for the purposes herein declared. The Trustees shall be at liberty to receive additional contributions, donations, grants, and bequests from any person or institution and to add the same to the corpus or income of the Trust as they deem appropriate."

The second sentence is important — it explicitly authorises the Trust to receive donations and grants, which is the primary source of income for most NGOs.

Trustee clause and powers

Initial Trustees

List all initial Trustees with full name, age, address, and occupation. If the Settlor is also a Trustee (common), this must be clearly stated.

Appointment and removal of Trustees

Specify how new Trustees are appointed (typically by resolution of existing Trustees), minimum and maximum number of Trustees, and grounds and procedure for removal (ill health, misconduct, absence from meetings, self-dealing).

Powers of Trustees

A comprehensive powers clause should include:

• To open and operate bank accounts in the name of the Trust
• To receive donations, grants, bequests, and subscriptions
• To purchase, lease, or sell immovable property with the sanction of the Board
• To invest Trust funds in permitted securities
• To appoint, pay, and dismiss employees and consultants
• To enter into contracts and execute legal documents
• To apply for and maintain RNPO, 80G, FCRA, CSR-1, and other registrations
• To institute or defend legal proceedings on behalf of the Trust
• To do all acts necessary for carrying out the objects of the Trust

Meetings and quorum

Specify:

• Frequency — at least 2 meetings per year recommended (quarterly is better practice)
• Notice period — 7–14 days written notice to all Trustees
• Quorum — minimum Trustees needed for a valid meeting (typically 2 or 50% of Trustees, whichever is higher)
• Decision making — simple majority for ordinary decisions; unanimous or two-thirds majority for major decisions (amending the Trust Deed, buying property, dissolving the Trust)
• Minutes — all meetings must be minuted and signed by the Managing Trustee or Chairperson

Finance and bank accounts

This clause should specify:

• The Trust will maintain a dedicated current bank account in the Trust's name
• Cheques/bank transfers above a specified amount (e.g., ₹10,000) require two authorised signatories
• The financial year (1 April to 31 March, aligned with the Indian tax year)
• Permitted investments — government securities, nationalised bank fixed deposits, etc. (avoid speculative instruments)
• Expense approval thresholds — what the Managing Trustee can approve alone vs what requires Board resolution

Non-profit clause — mandatory for RNPO

This is non-negotiable. Every Trust Deed submitted for RNPO must contain an explicit non-profit clause. Recommended language:

"No part of the income or property of the Trust shall be paid or transferred, directly or indirectly, by way of dividend, bonus, profit, or otherwise to any Trustee of the Trust or to the Settlor. This shall not prevent the payment of reasonable remuneration to any Trustee or person in return for any services actually rendered to the Trust, subject to the approval of the Board of Trustees, provided that such remuneration is not disproportionate to the services rendered."

Accounts and audit clause

"The Trust shall maintain proper books of account and financial records in accordance with generally accepted accounting principles. The accounts of the Trust shall be audited annually by a Chartered Accountant. The Trust shall file its Income Tax Return in Form ITR-7 with the Income Tax Department of India for every financial year, and shall comply with all applicable provisions of the Income Tax Act, 2025, including the requirements for RNPO registration under Section 332."

Dissolution clause — mandatory for RNPO

The dissolution clause must ensure that assets do not flow back to Trustees or founders on winding up. Required language:

"In the event of dissolution of the Trust or in the event of the Trust being wound up for any reason, the remaining assets and funds of the Trust, after meeting all liabilities, shall be transferred to one or more Public Charitable Trusts or institutions registered under Section 332 of the Income Tax Act, 2025, having similar objects, as decided by a two-thirds majority of the existing Board of Trustees. No part of the remaining assets shall be paid or transferred to the Settlor, any Trustee, or their relatives."

Amendment clause

The amendment clause specifies how the Trust Deed can be changed. A balanced clause:

"This Trust Deed may be amended by a resolution passed by a two-thirds majority of the Board of Trustees at a meeting convened with at least 21 days' notice specifying the proposed amendment. Any amendment to the Objects Clause or the Dissolution Clause shall require unanimity of all existing Trustees. Amendments shall be effected by executing and registering a Deed of Amendment before the Sub-Registrar. No amendment shall be made that would cause the Trust to cease to be a Public Charitable Trust eligible for registration under Section 332 of the Income Tax Act, 2025."

The last sentence is important — it prevents inadvertent or bad-faith amendments that compromise RNPO eligibility.

Execution and registration

The Trust Deed is executed as follows:

1. Print the final Deed on non-judicial stamp paper of the prescribed value for your state (see the Trust registration guide for state-wise stamp duty)
2. All pages initialled by Settlor and all Trustees
3. Final page signed in full by Settlor, all Trustees, and two witnesses
4. All parties appear before the Sub-Registrar with original identity documents
5. Sub-Registrar registers the Deed — receives unique registration number and endorsement
6. Collect multiple certified copies of the registered Deed

Frequently asked questions