A family trust to hold your business / shares — clean succession

The problem with holding shares personally

When a promoter holds shares personally, inheritance splits them among heirs — diluting control, creating minority factions and inviting disputes or forced sales.

What a holding trust does

• The trust owns the shares; trustees vote them as one block — control stays unified.
• The deed sets who benefits from dividends and how leadership passes.
• Shares don't get fragmented on each death; the trust continues.
• With a will and family settlement, it pre-empts litigation.

The tax picture

Dividends received by the trust are taxed per its character (specific → beneficiaries' slabs; discretionary → MMR). A holding trust mainly receives dividends and capital gains, not business income, so it usually avoids the business-income MMR trap. Transferring shares into the trust can be a capital-gains event — sequence it carefully (and note the post-2024 buyback rules).

Layering

Large families often use a trust over a holding company that holds the operating companies — the trust gives succession/control, the holding company gives the inter-corporate dividend deduction (Section 148, old 80M). Advanced structuring — we model it end to end.