Setting up a private charitable trust

Trusts are legal structures established to hold and distribute funds according to the legal requirements of the trust’s deed. Unlike some other forms of non-profit organisations, charitable trusts are not established to specifically undertake action to fulfil a purpose, but to distribute funds in a considered way in order to enable other organisations to pursue their purpose. Charitable trusts are often set up through a bequest in a will, but do not have to be. A trusts is established with the investment in the trust of an initial corpus of money that may be held in perpetuity. A certain percentage of the interest on this sum is granted periodically to particular causes, organisations, winners of scholarships or other grant-seekers. In some cases, a trust’s deed or other legal requirements such as wanting to retain tax exempt status may require that the trust only make grants to non-profit organisations or to charities.