Setting Up a Trust in Tanzania: Uses, Limits and Registration

This page is the Tanzanian trust operating file: what the deed can hold, who answers for it once signed, and which offices tax and record the outcome. It is not a drafting precedent and not a charity-registration manual.

• Choosing between vehicles: NGO, society, trust or guarantee company
• Before land enters the schedule: investment land due diligence
• Books the trustee must keep: records that support returns
• First three months of a structure: 90-day launch plan
• Wills and estates: wills and inheritance in Tanzania

As at 15 September 2026. Confirm rita.go.tz for incorporation of trustees and for lodging the deed. This file rests on Cap. 318, Cap. 358, the Land Act Cap. 113 and the Stamp Duty Act Cap. 189.

The law a Tanzanian trust sits on

Cap. 358 receives English common law, the doctrines of equity and statutes of general application in force in England on 22 July 1920, so far as local circumstances permit. The deed therefore does nearly all the work: no statutory default supplies investment, delegation or remuneration powers, and the received rule against perpetuities stops a family settlement running forever.

Cap. 318 turns appointed trustees into a body corporate with perpetual succession and a common seal, so property is not reconveyed each time a trustee dies. The certificate does not register the trust, prove the deed valid, or confer charity status.

Zanzibar keeps its own registries: companies at BPRA, wakf and trust property with the Wakf and Trust Property Commission. Income tax is a Union tax, so TRA owns the return wherever the deed was executed; VAT and stamp duty on the islands belong to ZRA.

Settlor, trustees, beneficiaries

The settlor transfers property and supplies the intention that creates the trust; afterwards the assets are no longer his. A settlor who keeps power to revoke, redirect income or instruct on distributions invites a revenue officer or judgment creditor to read the assets back to him.

Trustees take legal title and owe fiduciary duties. They may be individuals, a bank’s corporate trustee department, or a body incorporated under Cap. 318; two is the practical minimum.

Beneficiaries hold the equitable interest and must be ascertainable. “My family and dependants” fails for uncertainty of objects; “the settlor’s children living at each distribution date” does not. A protector who may remove and appoint trustees earns its place when beneficiaries are minors.

What the deed must carry

Beyond the three certainties (intention, subject matter, objects) the deed writes out what equity will not supply: appointment, removal and quorum of trustees; whether one illiquid asset may be held indefinitely; power to borrow against the property; accumulation and distribution mechanics; remuneration and indemnity; accounts and audit; the perpetuity period; governing law; and a schedule identifying every asset by its title number.

Settlor and trustees sign, witnesses attest before a notary public or commissioner for oaths, and the instrument is stamped. A document chargeable with duty but unstamped is not receivable in evidence under Cap. 189.

Uses and stopping points

A deed listing assets never moved leaves the estate intact, and it goes to the High Court or a Resident Magistrate’s Court under Cap. 352 as though nothing had been signed.

Mainland succession is plural: statutory, Islamic or customary rules govern a given deceased, selected through Cap. 358, and whatever stays in his own name enters that contest. Matrimonial property cannot be settled unilaterally: the Law of Marriage Act Cap. 29 protects the spouse, and both bank and Land Registry ask for written consent.

Land is the limit that bites first

Non-citizens may not hold land in Tanzania except as a derivative right for investment obtained through the Tanzania Investment Centre under the Tanzania Investment Act 2022. Incorporation does not help: the statute looks through to who controls the body, so non-citizen trustees holding for non-citizen beneficiaries still cannot take restricted land.

Village land is stricter: under the Village Land Act Cap. 114 it cannot pass to a non-citizen at all, and transfer to any corporate holder runs through the Village Council and Village Assembly, with conversion to general land where the purpose is investment.

A disposition of registered land goes to the Land Registry under the Land Registration Act Cap. 334; the deed itself is lodged at the documents registry under the Registration of Documents Act Cap. 117. If the trust will trade, screen the activity against the reserved list at GN No. 487A of 2025: no deed gives a non-citizen beneficiary what that list withholds.

How TRA reads the trust

Cap. 332 treats a trust as an entity distinct from settlor and beneficiaries. The trustee takes a TIN for the trust, files its return, and pays at the corporation rate of 30% on chargeable income, with provisional instalments due on the last day of the third, sixth, ninth and twelfth months of the year of income.

Whether a distribution is charged again in a beneficiary’s hands turns on the residence of the trust and the live provisions; settle that before promising a net figure. Charitable objects do not create exemption: that needs a ruling by the Commissioner General on the stated objects and how funds are in fact applied.

Where trustees trade or let commercial premises, VAT registration follows once taxable turnover passes TZS 100 million a year, charged at 18% under the VAT Act Cap. 148, and service levy at 0.3% of turnover under the Local Government Finance Act Cap. 290 attaches to that business. Trustees who employ staff meet PAYE, the skills levy and workers’ compensation.

Illustrative arithmetic on a Dar es Salaam building

A resident settlor moves a commercial building into a family settlement. Acquisition cost was TZS 400,000,000; the registered valuer puts market value at TZS 1,200,000,000. The transfer is a realisation, so the gain of TZS 800,000,000 attracts the single instalment at 10% for a resident: TZS 80,000,000, payable before the Registrar of Titles registers anything. A non-resident settlor pays 20%, or TZS 160,000,000. Conveyance duty under Cap. 189 rests on the same value; confirm the live rate at the stamping desk.

First year of operation: rent of TZS 180,000,000 less allowable deductions of TZS 60,000,000 leaves chargeable income of TZS 120,000,000 and tax of TZS 36,000,000. Turnover has crossed the threshold, so the trustees also account for VAT on the rent. Illustrative arithmetic, not a quotation; valuation, registry and consent charges sit outside it.

The order the desks take it in

1. Test the vehicle against the alternatives: trust, society, NGO and guarantee company do different work; decide before drafting.
2. Screen the people and the property: citizenship of everyone named, tenure of any land, whether an asset is matrimonial, and which succession rules would otherwise apply.
3. Draft and execute with an advocate, attested before a commissioner for oaths, the asset schedule annexed and signed.
4. Value, then stamp: a registered valuer’s report where land moves, then assessment and payment of duty before the instrument is used.
5. Settle the tax on the transfer in: TIN for the trust, the single instalment on any gain, the receipt kept for the registry.
6. Record it: deed at the documents registry, land at the Land Registry, and corporate form for the trustees where perpetual succession is needed.
7. Open the account: banks want the stamped deed, a trustees’ resolution, identification on everyone named, and source-of-funds evidence under the Anti-Money Laundering Act Cap. 423.
8. Operate it: trustee minutes, separate books, the annual return, and each distribution recorded when made, not reconstructed later.

Documents the file needs

Executed and attested deed with its schedule; proof of each asset: certificate of title or of occupancy, share certificates, bank statements, vehicle registration cards; NIDA numbers for citizens and passports for non-citizens; TINs for the settlor and every trustee; a signed consent to act from each trustee; minutes of the first trustees’ meeting naming chair and signatories; a board resolution where a company is settling assets; written spousal consent where matrimonial property moves; the valuer’s report; and the stamping and instalment receipts.

Where trustees are to be incorporated, add the Cap. 318 pack RITA publishes: objects, rules on how trustees succeed one another, and the proposed corporate name.

Where this file stalls

• A deed executed years ago and never funded: the settlor dies, probate opens, and the deed proves nothing about ownership.
• Beneficiaries described only as relatives, so the bank declines an account because the trustees cannot say who they answer to.
• Settlor, sole trustee and sole beneficiary are one person, and a creditor pleads sham.
• A non-citizen buyer told a settlement would carry village land. The Village Assembly never met and the title never moved.
• Duty left unpaid because the parties treated the deed as a private family paper.
• The instalment unpaid, so the Registrar will not register and title stays in the settlor’s name.

What beneficial-ownership filing changed

Since beneficial-ownership particulars entered the Companies Act Cap. 212, the company must identify and file the natural persons who ultimately own or control a trustee’s shareholding, which brings settlor, trustees and beneficiaries onto BRELA’s record. Banks apply an equivalent test under Cap. 423 at onboarding, and correspondent banks ask again. Deeds drafted on the premise that a settlement hides a shareholder are now the slowest matters at any counter. Confirm the current form and filing window with BRELA before the trustees subscribe for shares.

Mandate-holders this file does not replace

RITA owns the corporate form of trustees and the documents registry. TRA owns the TIN, the entity return and the instalment on transfers. The Land Registry and the ministry responsible for lands own the disposition and the citizenship question; village land answers to the Village Council. BRELA owns the beneficial-ownership record where shares are held, CMSA any arrangement inviting the public into a fund, and BPRA and ZRA their side on the islands. Drafting is an advocate’s work; an audit belongs to a licensed auditor. Zatra prepares, structures and coordinates across those offices, issues none of the approvals, and promises no outcome.

What to confirm before you act

• Citizenship of every trustee and beneficiary, against the tenure of any land the settlement is to hold.
• Whether the property is matrimonial, and whether the spouse consented in writing.
• Which succession rules would govern the estate if the deed failed or was never funded.
• The live trust row under Cap. 332 and the current duty schedule, from the revenue authority.
• Whether the objects as drafted would obtain a charitable ruling, or need rewriting first.
• Whether corporate form for the trustees is needed, or named individuals holding jointly will do.