About Trusts Law in Sri Lanka
Trusts in Sri Lanka are legal arrangements where a person (known as the settlor) transfers assets to another person (known as the trustee) to hold and manage for the benefit of third parties (known as beneficiaries). Trusts are often used for estate planning, asset protection, charitable purposes, and business succession.
Why You May Need a Lawyer
You may need a lawyer to help you create a trust, ensure that the trust is structured correctly, understand your rights and responsibilities as a trustee or beneficiary, resolve disputes related to trusts, and navigate the complex legal requirements surrounding trusts in Sri Lanka.
Local Laws Overview
In Sri Lanka, trusts are governed by the Trusts Ordinance, No. 9 of 1917. This law outlines the requirements for creating a valid trust, the duties of trustees, the rights of beneficiaries, and the procedures for administering trusts. It is important to consult with a lawyer who is familiar with these laws to ensure that your trust is legally sound and compliant.
Frequently Asked Questions
1. What is a trust and how does it work in Sri Lanka?
A trust is a legal arrangement where assets are transferred to a trustee to hold for the benefit of beneficiaries. The trustee manages the assets in accordance with the terms of the trust deed.
2. Who can create a trust in Sri Lanka?
Any person who is competent to contract can create a trust in Sri Lanka. This includes individuals, corporations, and other legal entities.
3. What are the different types of trusts available in Sri Lanka?
Common types of trusts in Sri Lanka include discretionary trusts, charitable trusts, testamentary trusts, and business trusts.
4. How do I choose a trustee for my trust?
When selecting a trustee, it is important to choose someone who is reliable, honest, and competent in managing the trust assets. You may also consider appointing a professional trustee, such as a bank or trust company.
5. What are the duties and responsibilities of a trustee in Sri Lanka?
Trustees have a fiduciary duty to act in the best interests of the beneficiaries, to manage the trust assets prudently, and to follow the instructions outlined in the trust deed.
6. How do I resolve disputes related to trusts in Sri Lanka?
Disputes related to trusts can be resolved through mediation, arbitration, or litigation in the courts. It is advisable to seek legal advice to determine the best course of action in your specific situation.
7. Can a trust be revoked or amended in Sri Lanka?
Depending on the terms of the trust deed, a trust may be revocable or irrevocable. Revocable trusts can be amended or revoked by the settlor, while irrevocable trusts are typically permanent and cannot be changed without the consent of all parties involved.
8. What are the tax implications of creating a trust in Sri Lanka?
Trusts in Sri Lanka are subject to taxes on income and capital gains. It is important to consult with a tax advisor to understand the tax implications of creating a trust and to ensure compliance with tax laws.
9. Can a foreigner create a trust in Sri Lanka?
Yes, foreigners can create trusts in Sri Lanka, subject to compliance with local laws and regulations. It is advisable to seek legal advice to understand the requirements for creating a trust as a foreigner.
10. How can I protect my assets through a trust in Sri Lanka?
Asset protection trusts can help safeguard your assets from creditors, lawsuits, and other risks. It is important to create a trust that is structured in a way that provides the desired level of asset protection while remaining compliant with the law.
Additional Resources
If you need legal assistance with trusts in Sri Lanka, you may consider contacting the Bar Association of Sri Lanka, the Department of Registrar of Companies, or a reputable law firm specializing in trusts and estate planning.
Next Steps
If you require legal assistance with trusts in Sri Lanka, the first step is to consult with a qualified lawyer who is experienced in trusts law. The lawyer can assist you in creating a trust, understanding your rights and obligations, and addressing any legal issues that may arise in the administration of the trust.
Disclaimer:
The information provided on this page is intended for informational purposes only and should not be
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frequently, and interpretations of the law can vary. Therefore, you should consult with qualified legal
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