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Differences that set a public trust aside from a private trust 


When people hear “trusts” they often assume it’s just one of a kind. However, trusts can be separated into 2 kinds: public trust and private trust. They are not the same as some assumed them to be. 

Definition of a Trust 

Definition of a Trust
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Before we move forward, let’s establish what trust means first. According to Investopedia, a trust is: 

A fiduciary relationship where 1 party known as a trustor gives another party, usually a trustee, the right to hold title to properties and assets for the benefit of a 3rd party, the beneficiary. 

You can commonly find trusts and trustees appointed in wills, insurance policies, bank accounts, and many financial documents and entities. Trusts and trustees ensure that the beneficiaries receive the assets of the deceased as requested in their legal documents. 

What Are The Differences between a Public Trust and a Private Trust? 

What Are The Differences between a Public Trust and a Private Trust
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Having said all of that, were you aware that there are differences between a private trust and a public trust? If you don’t already know, then here are some common differences between the 2 trusts.

Public Trust Private Trust
A public trust is a trust for a public entity. It’s a constructive trust meant for religious and charitable purposes. However, the entity or society has to be a registered society/entity in order to be listed as a beneficiary. A private trust is where the beneficiaries are definite and specific individuals. You can name anyone to be your will’s trustee or trust. The beneficiaries are often individuals and people. It can be your family and relatives, or it can be a very close friend.
There is no specific purpose and/or for any individuals to contribute to entities. Meaning to say, when an individual passes away, none of their assets or monies will go to any entities unless specifically stated in their wills and legal documents.  If a person passes away, the distribution act pushes the fact that the deceased’s next of kin gets their monies, assets, and properties. This is only when the deceased leaves no will behind. There are shared portions that get shared between the family members. You may check the technicalities of assets and monies distribution here.
Public trusts often are made for the purpose to benefit the public as a whole. For example, if you a member of a religious organization or society, and someone passes away and listed your religious institution as their beneficiary. Then that means whatever monies and assets that the deceased has given to your religious institution will not just benefit the institution itself, but also anyone and everyone else who are members of that institution. As the name suggests, private trusts are for the benefit of private individuals. If the will states certain members “related” will receive the monies or assets, then the individual will receive accordingly. However, if there is no will, which means there will be no trustees, then the distribution act will apply in this situation. An executor will take over the role of a trustee and help with the distribution accordingly.
A public trust is open for inspection. People can question the details of its trustees’ management and purpose. Since that it is a public trust, special care are taken to make sure that transparency, effectiveness, and utility are not diminished and continuously serve the beneficiaries as intended. A private trust is meant for the private eye. Only lawyers and beneficiaries are able to view it besides the will’s owner. If anyone that is not related to the deceased wish to view it, they won’t be able to.
There isn’t exactly a “centralized” public trust act in Malaysia, however, there are state-specific and religion-specific public trusts that exist. 

In order for anyone to register for public trust in Malaysia, they will have to have a draft of the trust deed stating the trustees, trust objectives, and intended beneficiaries. As soon as that is settled, then have the public trust registered under your state’s trust act. Registering it will enable the public trust eligible for tax rebates (if any). Religious endowments and Wakfs are also variations of public trusts too.

To legitimize your will, you will first have to write a will with the help of a certified lawyer. Make sure that you are at least 18 years old and above, be in sound mind, your will has to be in writing, and have your will signed by the will maker in the presence of 2 witnesses. The 2 witnesses (preferably above 21 years old) will also have to sign the will in the presence of each other and the will maker. 

The above is for non-Muslims. If you are a Muslim, there are different sets of rules for your will.


There are differences between a public trust and a private trust. We hope that you are able to differentiate between the two after reading this article. 

If you need any help with wills and trusts, do not hesitate to contact us. We will be more than happy to assist you.