THE TRUST ADMINISTRATION ACT 2026: A NEW FRAMEWORK FOR TRUST ADMINISTRATION

Kenya has introduced a new statutory framework for the creation, registration and administration of Trusts. Assented into law on 8^th September 2026 and set to come into force on 25th September 2026, the Trust Administration Act, 2026 (hereinafter referred to as” the Act”) consolidates the already existing legal frameworks governing Trusts and introduces new requirements relating to registration, beneficial ownership, governance, trustee obligations and regulatory oversight.

The Act repeals the Trustee Act, Cap. 167 and the Trustees (Perpetual Succession) Act, Cap. 164, bringing various aspects of trust administration under one legislative framework.

The salient features of the Act include:

Beneficial Ownership Disclosure

One of the most significant changes introduced by the Act is the formalization of beneficial ownership requirements for trusts. Trustees are required to maintain a register of beneficial owners and lodge prescribed information with the Registrar. The concept of beneficial ownership extends beyond the person who established the trust or settled assets into the trust.

Trustees will therefore need to identify the relevant individuals, obtain the required identification and residence information, keep the information accurate and up to date, and maintain appropriate supporting records.

Registration,Incorporation and Governance

The Act establishes a Register of Trusts and provides a clear distinction between registration and incorporation. Registration places trust withing the statutory framework while incorporation gives the trustees a separate legal personality through which they may hold property and also enter into transactions.

The Act gives recognition to the role of an enforcer as an additional accountability mechanism within the trust structure and has responsibilities aimed at ensuring that trustees properly discharge their obligations.

The Act provides, among other requirements, that a family trust must have at least one (1) trustee, while charitable and non-charitable trusts must have at least three trustees. Where a corporate trustee or trust corporation is appointed, at least one trustee must be a resident in Kenya.

Trustee Duties and Beneficial Rights

The Act also provides a more detailed statutory framework governing the responsibilities of trustees and the rights of beneficiaries. Trustees are subject to obligations concerning the proper administration of trust property, fiduciary responsibilities, accounts, audits and record keeping. Beneficiaries are also given rights relating to access to information concerning the administration of the trust.

These provisions are particularly relevant to family trusts, where disputes may arise concerning investments, distributions or the management of trust assets. Proper documentation and transparent administration will therefore become increasingly important.

Compliance and Penalties

The Act introduces financial penalties for certain forms of non-compliance. These include failures relating to the maintenance of beneficial ownership information and the provision of information to enforcement authorities.

Reported penalties include fines of up to KSh 500,000 for individuals and KSh 2 million for corporate entities for certain failures to maintain beneficial ownership records, with higher penalties applicable to some other forms of non-compliance.

Trustees should, however, consider the applicable provisions of the final legislation and any regulations issued under it when determining the precise extent of potential liability.

What Happens to The Existing Trusts Established Before The Act came into Force?

The Act provides that trusts incorporated before commencement must lodge a copy of their beneficial ownership register with the Registrar within 24 months of the Act coming in force. Existing trusts should therefore begin reviewing their records and structures rather than waiting until the compliance deadline approaches.

Conclusion

The Trust Administration Act, 2026 marks an important development in Kenya’s trust law. While trusts remain available as effective vehicles for succession planning, wealth preservation, charitable purposes and asset management, they will now operate within a more formal framework of registration, disclosure and regulatory oversight.

At HMS Africa, we advise our clients on broad range of corporate and commercial matters such as establishment of trust, regulatory compliance, appropriate structure, governance arrangement among others.