There are two types of trust, Public Trust and Private Trust. A public trust (charitable trust) is created for the benefit of the general public whereas a private trust is created for the benefit of a particular group of individuals known as the beneficiary.

Litigation

Every Trust has its legal entity separate from its members it is capable of filing suits against any person or any member. The registered trust can file a suit anywhere in India and in any state even if it is not registered in that particular state.

Legal status

Registration of trust gives it a legal status and that is very important because of various reasons like: for opening bank accounts, obtaining registrations and approvals under Income Tax Act, legally vesting properties.

Tax Benefit

The trust can take the tax benefit after applying for the 12AA/80G Certificate. Both the trust and the investor get tax exemptions.