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CRUCIALITY OF ESTATE PLANNING FOR NRI’S

As the number of Non-Resident Indians (NRIs) living and working abroad continues to rise, concerns around NRI estate planning and asset succession have also increased proportionally. With complex cross-border tax and inheritance laws involved, proper NRI estate planning is essential for NRIs looking to pass on their assets smoothly to their heirs in India. In a world where the Indian diaspora is spread far and wide, managing assets and properties across borders becomes a crucial aspect for Non-Resident Indians (NRIs). Beyond the emotional and financial ties that connect them to their homeland, NRIs face the challenge of navigating complex inheritance laws when it comes to managing their estates.

The Role of a Well-Crafted Will

Wills are indispensable for NRIs, securing their legacy and assets regardless of their residence. Estate planning is an ongoing process; keeping the will current and adapting it to life changes ensures the legacy remains protected. Whether an NRI or not, proper estate planning through a will is essential to safeguard one’s legacy. A will is not just a recommended practice for NRIs; it is a critical tool to ensure their wishes are honored and their legacy protected. The absence of a clear will may lead to further disputes and legal complications.

A well-drafted will addresses the complexities of diverse legal systems, providing clear instructions on asset distribution. NRIs should include key elements like a comprehensive list of assets, beneficiaries, and an executor. Seeking professional legal advice ensures compliance with both Indian and foreign laws, and proper execution and registration in India validate the will.

For NRIs, creating a will for Indian properties is a critical step in securing your family’s future and preventing potential inheritance disputes. In today’s world, where NRIs often maintain investments in India while residing abroad, the importance of clear estate planning is vital. Creating an effective will as an NRI often involves unique challenges. One of the primary obstacles is navigating the complex jurisdictional requirements spanning multiple countries.

Being physically distant from India adds another layer, as managing documentation and legal requirements can be difficult. Consider the case of Rajesh Patel, an NRI in the UK, who faced significant hurdles in claiming an inherited Mumbai property due to a lack of a will.

Common challenges include:

  • Jurisdictional Complexities: A will created in another country may require validation steps to be valid in India. Understanding these differences is crucial.
  • Documentation Requirements: Certain Indian legal processes require specific documents and in-person attestations.
  • Family and Cultural Dynamics: Managing expectations and family disputes is harder from abroad.

Key estate planning strategies for NRIs

 

  • Have a will executed in the home and host country – This will cover global assets and appoint executors with authority across jurisdictions.
  • Obtain Indian probate for immovable property – To streamline transfer of real estate to legal heirs in India.
  • Create a private discretionary trust – Appoint Indian trustees to professionally manage and pass on Indian assets per terms of the trust deed.
  • Consider the tax implications while transferring/receiving assets – Structure transfers judiciously using tax treaties to avoid double taxation.
  • Use nominations and gift deeds for a quick settlement – Especially for FDs, investments, and certain movable assets located within India.
  • Determine domicile and residency status for inheritance law – Crucial for determining personal laws and distribution of worldwide assets according to the home and host country rules.
  • Seek expert guidance from estate planning lawyers – To ensure all legal documentation is prepared and executed as per relevant regulations in India and country of residence.

 

Conclusion

 

Effective estate planning involves multiple factors for NRIs. With strategic choices around wills, trusts, taxation, domicile, and more, they can ensure a hassle-free inheritance transfer of their Indian assets to their legal heirs as intended. Consultations with experienced cross-border legal experts are recommended to aid the pro

An Essential Guide to The Societies Registration Act, 1860: Understanding Its Purpose and Impact

INTRODUCTION

As the nation develops and grows each day, equal importance should be given to all regions in all genres. The best approach to the advancement and recognition of any field is to create groups and societies that understands the skills and talents of individuals to help them grow bigger, better and appreciated, and to do things beyond the standards and definitions of those around them.

In India, Registration of Society works on the doctrine of management and regulation of registration and other such aspects related to societies. Society registration is being done for various purposes including the promotion of development of science, art, and charity in some way.

WHAT IS A SOCIETY?

To begin with, let us understand what is a society. According to The Societies Registration Act, 1860, registered a “society” which has been accepted by various state governments with or without further amendment. Furthermore, the Act defines it as “an association of persons united by mutual consent to deliberate, determine and act jointly for some common purpose. Societies are usually formed for the promotion of charitable activities like education, religion, art and culture, music, and sports activities etc.”

WHY TO REGISTER A SOCIETY?

There are various benefits as to registration of a society like-

  • Helps to attain legal status after being registered.
  • Gets certified statutory status which further helps in legal implication of society’s wealth.
  • The said registered society can open its current account by own name.
  • A registered society can obtain registration and approval under the Income Tax Act.
  • Entitles to income tax exemption under the Income Tax Act.
  • Gives a separate legal entity after registration.
  • Gets various legal rights like the Right to lease, rent, buy or sell property or borrow money and even to enter into legal contracts in it’s own name.
  • A registered society can sue or be sued.
  • A registered society is legally recognized in the eyes of all forums and government officials.
  • The members of the society are not personally liable for any debts or obligations only unless a loan is obtained for activities undertaken to make a profit or certain activities which are illegal in nature.

WHAT IS THE OBJECTIVE OF REGISTRATION OF SOCIETY?

According to Section 20[1], the main purposes of the Registration of Society are as follows:-

  • Charitable Societies for various vulnerable sections of society like National Socity for equal opportunities for the Handicapped, Nirmal Jyoti Educational and Charitable Society.
  • Origin of Military Orphan Funds
  • Establishment of societies at the several presidencies of India
  • The promotion of science, literature or the Performing Fine Arts- NCERT (National Council of Educational Research and Training), Kala Kendras etc.
  • Promotion of Diffusion and Instruction of useful knowledge
  • The Political Education Diffusion
  • The maintenance or foundation of reading rooms or libraries for open to the public or general use among the members
  • Maintenance and collection of Natural History
  • Knowledge
  • Grants for charitable aid
  • For any other reason approved by the government.

 

WHAT ARE THE DOCUMENTS REQUIRED TO REGISTER A SOCIETY IN INDIA?

  • PAN card- All of the proposed society member have to submit PAN CARD along with the application.
  • Residence Proof- For the valid Residence Proofs, all the society member have to submit-
  • Aadhar Card
  • Bank Statement
  • Utility Bill
  • Passport
  • Driving License
  • Memorandum of Association (MOA)- It should contain objective and function of the society for which it is being established, details information of the members constituting the society and it must contain the address of the registered office of the society.
  • Society Rules and Regulations
  • Covering Letter
  • Address Proof- A copy of the address proof where the registered office of the society will be located from the landlord with a Non Objection Certificate (NOC), if any, is to be attached.
  • List of the entire members
  • Declaration – The President is willing and able to hold the said post of the proposed society if to be declared.

[1] Indian Societies Registration Act,1860.