Charitable Trust Deed (Nigeria)

A Charitable Trust Deed in Nigeria transfers an interest in property between the named parties and records the terms of that transfer.

The primary legal framework governing trusts in Nigeria is the Trustee Act Cap T22 LFN 2004 (applicable in the South) and the Trustee Law applicable in Northern states, supplemented by common law and equitable principles received from English law. For charitable organisations seeking legal personality, Part F of the Companies and Allied Matters Act (CAMA) 2020 (Sections 823 to 849) provides the mechanism for registration as Incorporated Trustees with the Corporate Affairs Commission (CAC), giving the charitable body corporate status with perpetual succession.

Charity law in Nigeria recognises four heads of charitable purpose derived from the English law tradition: relief of poverty; advancement of education; advancement of religion; and other purposes beneficial to the community. Nigerian courts, including the Federal High Court and the Court of Appeal, have applied these four heads of charity in determining whether a purpose is charitable for the purposes of CIT exemption under the Companies Income Tax Act.

The Federal Inland Revenue Service (FIRS) grants CIT exemption to qualifying charitable organisations under Section 23(1)(c) of the Companies Income Tax Act Cap C21 LFN 2004, subject to the organisation applying for an exemption letter and satisfying the FIRS that its activities are genuinely charitable and that no part of its income benefits its trustees or founders.

Real property held in trust in Nigeria is subject to the Land Use Act 1978 (Cap L5 LFN 2004), which vests all land in the state governor and requires the governor's consent under Section 22 for any alienation of a statutory right of occupancy. Charitable trusts holding land must obtain a Governor's Consent each time trust land is sold, transferred, or mortgaged. Certificate of Occupancy (C of O) documents for trust-held land should be maintained in the trust's statutory records. The Lagos State Land Bureau and equivalent State Land Registries process Governor's Consent applications, which typically require submission of the trust deed, CAC incorporation certificate, and valuation report.

The Nigeria Data Protection Act 2023 (NDPA), administered by the Nigeria Data Protection Commission (NDPC), applies where the charitable trust processes personal data of beneficiaries, donors, or employees. Incorporated Trustees registered under Part F of CAMA 2020 must also comply with the Special Control Unit Against Money Laundering (SCUML) registration requirements under the Money Laundering (Prevention and Prohibition) Act 2022, which applies to non-profit organisations operating in Nigeria as designated non-financial businesses and professions (DNFBPs) under the Financial Action Task Force (FATF) standards adopted by Nigeria. The Corporate Affairs Commission (CAC) requires Incorporated Trustees to file annual returns under CAMA 2020, and the Federal Inland Revenue Service (FIRS) administers the CIT exemption application process under the Companies Income Tax Act Cap C21 LFN 2004.

A Nigeria Charitable Trust Deed is needed in the following situations.

When a philanthropist, family, or corporation wishes to create a permanent charitable vehicle to support a defined cause — such as education, healthcare, poverty relief, environmental conservation, or community development — and wants a formal legal structure that separates the charitable assets from their personal assets and confirms the funds can only be used for the charitable purpose.

When a religious body, church, or mosque wishes to formalise the holding and management of its assets (land, buildings, investment funds) through a trust structure, with trustees accountable to the congregation or the faith community.

When a family wishes to honour the memory of a deceased member by establishing a scholarship fund or a charitable endowment in their name, with the trust deed specifying the criteria for beneficiaries, the selection process, and the investment mandate.

When a corporate donor or foundation wishes to establish a dedicated philanthropic vehicle in Nigeria that can receive tax-deductible donations and manage grant-making activities, with CAC registration as Incorporated Trustees providing the legal personality needed to open bank accounts, acquire property, and enter contracts.

When an existing unregistered community or charitable organisation wishes to formalise its structure by adopting a trust deed and registering as Incorporated Trustees with the CAC under Part F of CAMA 2020, to gain legal personality, protect the organisation's name, and qualify for tax exemption from the FIRS.

Parties in Nigeria should prepare a Charitable Trust Deed (Nigeria) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.

A complete Nigeria Charitable Trust Deed should contain the following elements.

Settlor details: Full legal name, address, and nationality of the settlor (the person establishing and initially funding the trust). For corporate settlors, RC Number and registered address.

Trustees: Full legal names, addresses, occupations, and nationalities of the initial trustees (minimum 2). A trustee acceptance clause confirming each trustee's consent to act. Provisions for the retirement, removal, and replacement of trustees.

Name of the trust: The name by which the charitable organisation will be known, including the word 'Foundation', 'Trust', 'Fund', or 'Society' as appropriate — the CAC requires a distinct and acceptable name for Incorporated Trustees registration.

Charitable objects: A precise and legally valid statement of the charitable purposes for which the trust is established — for example: 'to advance education by providing scholarships and bursaries to academically gifted students from low-income households in Nigeria'. The objects must fall within one of the recognised heads of charity and must be exclusively charitable.

Initial trust property: Description of the property or funds transferred by the settlor to the trustees at the establishment of the trust — cash, land (with C of O details), securities, or other assets.

Investment powers: The scope of the trustees' powers to invest the trust fund — at minimum, the trustees' statutory investment powers under the Trustee Act Cap T22 LFN 2004; ideally expanded to include a broader investment mandate consistent with the charitable purpose.

Beneficiaries and application of income: Description of who benefits from the trust (the public or a class of the public), how income and capital are to be applied, and the grant-making or programme delivery process.

Governance: Provisions for trustee meetings, quorum, decision-making, record-keeping, and annual reporting to the CAC as required by CAMA 2020.

Dissolution: What happens to the trust's assets on dissolution — must be transferred to another charitable body with similar objects, not to the trustees or settlor.

Governing law: Laws of Nigeria, with jurisdiction of the Federal High Court or the relevant state High Court.

Additional compliance elements for a Charitable Trust Deed (Nigeria) used in Nigeria include: Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Forms-legal.com provides this template as a starting point for Nigeria-compliant documentation.