Families with land, shares, savings or a business usually reach the same question sooner or later: should everything simply pass under a will, should it go into a trust, or should a company hold it? In Kenya the answer changed on 25 September 2026, when the Trust Administration Act, 2026 came into force. This guide compares the main structures for family wealth in Kenya, what each does well, where each falls short, and how to choose between them.
The three building blocks
A will is the simplest tool. Under section 11 of the Law of Succession Act, a written will is valid if the testator signs it and two or more competent witnesses attest it. It is inexpensive and can be changed at any time. Its weakness is that nothing happens until death, and then the estate must pass through probate: a court petition, a grant, confirmation and distribution, all of it public and open to objection. Our guide to wills, probate and estate administration explains that process.
A family trust holds assets now, through trustees, for the family’s benefit. Section 10 of the Trust Administration Act defines a family trust as a living or testamentary trust set up to plan or manage a personal estate, for the preservation or creation of wealth across generations, and it must be a non-trading entity. Assets transferred into a trust during your lifetime are no longer part of your personal estate, so they do not need a grant of probate to reach the family.
A family holding company owns assets through shares. Family members hold the shares, and the articles of association and a shareholders’ agreement govern control and exits. A company suits assets that trade or generate business income, which matters because a family trust cannot trade.
How they compare on the points that matter
Control during your lifetime
With a will you keep full ownership until death. With a company you keep control through voting shares and directorship. With a trust, legal ownership passes to the trustees, but the Act lets a settlor reserve significant powers: to vary the trust, direct distributions and appoint or remove trustees (section 13). A settlor can also be a trustee and a beneficiary, though never the sole beneficiary (section 12(3)). One trap: a trust is irrevocable unless the deed contains an express power of revocation (section 7).
Probate and continuity
A will depends on probate. A lifetime trust and a company both continue without it: trustees keep managing trust property, and a company continues regardless of who dies, although the deceased’s shares themselves still pass through the estate unless they were held in trust. That is why many families combine structures, with a trust holding the shares of the family company.
Privacy
Probate files are court records. A trust used to offer more privacy, but that has narrowed. A written trust must now be registered or incorporated with the Registrar of Trusts to be enforceable (section 5), and every trust must keep and lodge a register of its beneficial owners (sections 65 and 66). Companies face a similar beneficial ownership regime, covered in our guide to beneficial ownership filings.
Dependants’ claims
Under section 26 of the Law of Succession Act, a court can order reasonable provision for a dependant out of the deceased’s net estate where the will, a gift in contemplation of death, or intestacy leaves them without it. A lifetime trust takes assets out of the estate, but a transfer made in contemplation of death is expressly within section 26. A trust made to defeat creditors can also be declared void (section 6(3) of the Trust Administration Act).
Land and non-citizen family members
Under Article 65 of the Constitution, non-citizens may hold land only on leasehold of up to 99 years, and property held in trust counts as held by a citizen only if all the beneficial interest belongs to citizens. The same rule applies to a company, which counts as a citizen only if it is wholly owned by citizens. If any beneficiary or shareholder is not a citizen, freehold land needs careful structuring. Our article on family land, succession, trusts and land-holding companies covers land-holding structures in more depth.
Tax
The First Schedule to the Income Tax Act exempts the principal sum of a registered family trust (paragraph 57), capital gains on transferring immovable property to a family trust (paragraph 58), and gains on property, including shares, transferred into a registered family trust (paragraph 36(g)). Stamp duty is narrower than often assumed. The Stamp Duty Act treats a gift of property as if it were a sale (section 52(1)), and its express exemption for transfers to a registered family trust in section 52(2)(b) is limited to trusts for charitable purposes only. Plan for stamp duty on transferring land into a private family trust unless the Collector confirms otherwise. Neither Act defines “registered family trust”, and whether an incorporated family trust under the new Act qualifies has not yet been tested, so take advice before relying on an exemption.
Cost
A will is the cheapest to set up but carries probate costs later. A trust costs more upfront, including registration or incorporation with the Registrar, and carries annual returns (section 75) and record-keeping for at least seven years (section 63). A company carries its own filing and governance costs. The Registrar’s fees under the new Act are still to be prescribed by regulation (section 83). Our professional fees for trusts are published on our Our Fees page.
Choosing the right structure
- A will alone may be enough for a modest estate, a single home and savings, or where the family is small and relations are good.
- A family trust suits families who want assets managed across generations, provision for minors or vulnerable members, and continuity without probate.
- A holding company suits assets that trade or generate business income, and families that want governance through shares and a board. See our guide to family business succession.
- A combination is common: a trust holds the family company’s shares, and a will deals with everything left outside both.
Whatever you choose, keep a will. Even with a trust in place, some assets always remain outside it.
How We Can Help
Clay & Associates Advocates advises families on structuring wealth through wills, trusts and holding companies, and on registering and running trusts under the Trust Administration Act, 2026. If you are weighing a trust, our guide to registered and incorporated family trusts explains the next decision. Contact our Corporate & Commercial team to discuss the right structure for your family.
Sources: Trust Administration Act, 2026, sections 5, 6, 7, 10, 12, 13, 63, 65, 66, 75 and 83; Law of Succession Act, sections 11 and 26; Constitution of Kenya, Article 65; Income Tax Act, First Schedule, paragraphs 36(g), 57 and 58; Stamp Duty Act, section 52.
Frequently asked questions
Does a family trust avoid probate in Kenya?
Assets transferred into a trust during your lifetime are held by the trustees and do not need a grant of probate. Assets you still own personally at death do, which is why a will remains necessary alongside a trust.
Can I control assets I put into a trust?
Yes, to a degree. The deed can reserve powers to the settlor, such as varying the trust or appointing trustees, and you can act as a trustee yourself. A trust is irrevocable unless the deed expressly allows revocation.
Is transferring land into a family trust free of tax?
Capital gains on the transfer are exempt under the Income Tax Act, but the Stamp Duty Act’s express exemption covers only registered family trusts for charitable purposes. Budget for stamp duty on a private family trust unless the Collector confirms otherwise.
Should I use a trust or a company to hold a family business?
A family trust cannot trade, so the business itself usually sits in a company. Many families then place the company’s shares in a trust to combine governance through the company with continuity through the trust.
