Kenya's New Trust Administration Act, What Changes for Family Trusts and Estate Planning

Kenya's new trust law could make your family trust unenforceable if you miss the deadline

Say a relative set up a family trust five years ago to keep the family home and a few rental properties out of a messy succession fight. A lawyer drafted the deed, everyone signed it, and the family has been operating under it ever since without ever registering it anywhere. Under the law that takes effect September 25, 2026, that trust's enforceability is no longer guaranteed by the deed alone.

The Trust Administration Act, 2026 (No. 28 of 2026) was assented to on September 8 and repeals the two laws that have governed Kenyan trusts for close to a century, the Trustee Act and the Trustees (Perpetual Succession) Act. It doesn't touch every part of trust law. Much of what sounds new, the idea of a family trust where the settlor also benefits, the default assumption that a trust is irrevocable, the "enforcer" role that watches over a trustee, was actually already added to Kenyan law in 2021. What the new Act does is fold those 2021 reforms into one statute and add several genuinely new requirements on top, the biggest of which is that registration now decides whether a written trust can be enforced at all.

A trust deed used to be enough on its own. Now, if it's written and it isn't registered or incorporated, it may not hold up in court.

Does my trust still count in law after September 25?

Under the old regime, a properly drafted, signed trust deed was enforceable in its own right. Incorporation, turning the trustees into a body corporate, was something a trust could opt into, mainly so it could hold property and be sued in its own name rather than through named individuals.

The new Act changes that starting point. Section 5 says a written trust must be registered or incorporated with the new Registrar of Trusts, an office inside the Business Registration Service, and that it isn't enforceable until that happens. That single rule is the one most likely to catch people off guard, since it applies to the informal, lawyer-drafted family trust just as much as a large commercial one.

The Act does leave one door open. Anyone with an interest under a written trust that was never registered or incorporated can still ask a court to recognise or enforce it, under the same section. That's a real option, not a loophole to lean on, since it means arguing your case in court instead of pointing to a registered certificate. The Act also says none of this touches a trust created by a court order, under a will, or under customary law or equity, those keep whatever standing they already had before this Act. The rule that should worry most families is specifically about a written trust deed that nobody ever took to the Registrar.

If your trust was already incorporated before commencement, the Act deems it a trust under the new law automatically, no fresh application needed. If it wasn't formally set up with the Registrar at all, existing trusts get 24 months from September 25, 2026 to come into compliance, according to the Act's transitional provisions. That gives most families a two-year runway, but it isn't indefinite, and it isn't automatic either.

What's the actual difference between "registered" and "incorporated"?

The Act creates two tiers, and the distinction matters more than it sounds. A registered trust is simply recorded with the Registrar. It has no legal personality of its own, so its property and any lawsuit involving it still run through the named trustees personally. An incorporated trust becomes a body corporate, capable of holding property, suing and being sued, and continuing in existence in its own name even as individual trustees come and go.

For a family that wants a trust to outlast any one trustee without needing to retitle every asset each time a trustee changes, incorporation is the more durable choice. Registration alone is lighter and cheaper, but it leaves the trust's legal footing tied to whoever happens to be a trustee at the time.

Can I set up a trust and still benefit from it myself?

Yes, and this part isn't new, even though it often surprises people. Kenyan law has allowed a self-settled family trust since 2021, when the old Trustees (Perpetual Succession) Act was amended to say a family trust "shall not be invalid for reason that the settlor or joint settlors are also beneficiaries." The new Act carries that rule forward largely unchanged.

That matters for anyone hesitant to set up a trust because they assumed handing over legal ownership meant giving up the benefit too. A family trust can name the person who created it as one of the beneficiaries, provided it's made for the purpose of preserving or creating wealth across generations and doesn't operate as a trading business. One limit still applies: a settlor can be a beneficiary of their own trust, but cannot be its only beneficiary, so the deed still needs at least one other person or class of people named to benefit.

If I create a trust, can I still change my mind later?

Only if the deed says so. Since 2021, Kenyan trusts have defaulted to irrevocable unless the deed contains an express power of revocation, and the new Act keeps that default. If a settlor never exercised a revocation power during their lifetime, the trust is treated as irrevocable regardless of what anyone assumed going in.

That default is worth checking against your own trust deed specifically, not assuming either way. The Act does let a settlor reserve real ongoing control without becoming a trustee themselves, including the power to revoke or vary the trust, direct how distributions are made, give the trustee directions on buying, selling or managing trust property, and appoint or remove trustees, an enforcer, or the trust agent, but only if the deed spells those powers out. Silence defaults to irrevocable and to no reserved powers at all.

Who is actually watching my trustee?

The Act carries forward a role called the enforcer, also introduced in the 2021 amendment, most useful in a trust that has no beneficiary to hold the trustee accountable day to day, such as a non-charitable purpose trust. An enforcer can demand the trust's accounts and documents, require a trustee to take remedial action after a breach, and bring legal action against a trustee who won't cooperate. The same person can't be both enforcer and trustee, and an enforcer isn't allowed to profit from the role or transact with a trustee over trust property.

For a family trust with named beneficiaries who are adults capable of asking questions themselves, an enforcer isn't required. For a purpose trust, or one benefiting minors or people who can't easily assert their own rights, appointing one gives the arrangement a built-in check that doesn't depend on a beneficiary being able or willing to challenge the trustee.

Does a trust still protect my family's privacy?

This is where the new Act genuinely narrows something that trusts have offered before. Every trust, registered or incorporated, must now compile and lodge with the Registrar a register of its beneficial owners, the real individuals who ultimately control or benefit from it. That information isn't sealed. The Registrar can disclose it to competent authorities, to regulators supervising money laundering and terrorism financing, and to any institution designated as a reporting institution under the Proceeds of Crime and Anti-Money Laundering Act.

Trusts that already existed before commencement get 24 months to lodge that register, matching the general compliance deadline, and any later change to who the beneficial owners are has to be reported within 21 days. If part of the appeal of a trust structure for you was the privacy it offered relative to holding assets in your own name, that gap has narrowed meaningfully. It hasn't disappeared, the register isn't public, but it's now visible to a defined circle of authorities in a way it wasn't before.

Who is allowed to serve as my trustee?

Two new qualification rules matter here, neither of which existed under the old Trustee Act. First, at least one natural-person trustee must be a Kenyan citizen or resident, which affects any family, particularly one with members in the diaspora, that was planning to use an entirely foreign trustee panel. Second, if you want a corporate trustee, a bank's trust arm or a dedicated trust company, that entity now has to be registered and licensed to act as one, its main purpose has to be providing corporate trustee services, and it must keep a Kenya-resident natural person as a local contact.

Separately, anyone disqualified from acting as a company director, anyone barred from acting as a liquidator, and anyone convicted of corruption or an economic crime or of an offence carrying more than six months' imprisonment cannot serve as a trustee at all. That's a broader disqualification net than the old law carried.

What happens if my trustee mismanages the trust?

The new Act spells out trustee duties in far more explicit detail than the old Trustee Act ever did, care and skill appropriate to the circumstances, acting only in the beneficiaries' interest, avoiding conflicts, treating multiple beneficiaries impartially, and not taking any profit or reward beyond agreed remuneration. A trustee who commits or is party to a breach is liable for the resulting loss and for any profit the trust would otherwise have earned, on top of an administrative penalty that can run to a million shillings for an individual trustee or five million for a corporate one.

One protection worth knowing about sits in Section 62. A trust deed cannot exclude a trustee's liability for breaches involving dishonesty, willful misconduct, or gross negligence, and that rule applies even to a deed written before this Act existed. If your own trust deed happens to contain a broad liability waiver for the trustee, that clause is no longer enforceable against the worst kinds of conduct, regardless of when it was signed.

What happens if paperwork gets missed?

The Act attaches a specific shilling penalty to almost every filing deadline it creates, and most of them are small individually but easy to accumulate. Missing the 21-day window to notify the Registrar of a new trustee's appointment costs 7,000 shillings for an individual trustee or 14,000 for a corporate one. Missing the same window for a trustee's resignation or removal carries the same penalty, and the same 21-day window applies to a change of enforcer, though that one costs less, 5,000 shillings for a natural-person trustee in default or 10,000 for a corporate one. Falling behind on the beneficial ownership register costs 10,000 or 20,000 shillings depending on whether the defaulting trustee is a natural person or a body corporate. Annual returns filed late cost 3,000 shillings for every year of default.

None of these individually threaten a family's wealth. Together, across several trustees and several missed 21-day windows over a few years, they add up to a genuine ongoing compliance obligation that a family trust simply didn't carry before, since the old Trustee Act had no administrative penalty regime attached to it at all.

What this means for your own planning

None of this requires panic before September 25. It requires a specific, time-bound checklist. If you already have a family trust, confirm whether it was ever registered or incorporated, and if not, start that process well inside the 24-month window instead of at the deadline. Reread the deed itself for what it actually says about revocability and about any reserved powers you assumed you had, since the law's defaults may not match what you remember agreeing to. If the trust holds meaningful assets and few or no beneficiaries capable of policing the trustee themselves, consider whether an enforcer belongs in the structure. And if privacy was part of why you chose a trust over holding assets personally, factor in that a beneficial ownership register is now part of the arrangement, whether or not you've thought about it yet.

A trust that sits unregistered past its compliance window isn't just informally organized anymore, it risks being unenforceable exactly when a family needs it most, in a dispute, a death, or a disagreement between beneficiaries. The paperwork used to just formalize the arrangement. Now it's what makes the arrangement real in the eyes of the law.

Source: Trust Administration Act, 2026 (Act No. 28 of 2026), Kenya Gazette Supplement No. 223, assented September 8, 2026, commencing September 25, 2026; Trustees (Perpetual Succession) Act, Cap. 164 (as amended by Act No. 13 of 2021), repealed September 25, 2026; Trustee Act, Cap. 167, repealed September 25, 2026. This article explains the law in general terms and is not legal advice. Anyone restructuring an existing trust or setting up a new one should consult a qualified advocate.