HMRC extends scope of Trust Registration Service

HM Revenue & Customs’ (HMRC) has implemented legislative changes to its Trust Registration Service (TRS).

The scope of the TRS has been extended to cover almost all UK express Trusts and some non-UK express Trusts established on or before 6 October 2020.

The UK TRS came into effect following implementation of the EU’s Fourth Money Laundering Directive. The directive aims to improve transparency around the beneficial ownership of assets held in Trusts with UK tax liabilities.

The Fifth Money Laundering Directive, implemented on 6 October 2020, extends the scope of the TRS with limited exclusions and covers certain non-UK trusts, but all UK express trusts. Brexit has not affected the obligation to comply, as the Directive was transposed into UK law.

Commenting on these developments, Axiom DWFM Partner Harry Pattihis said: “This briefing note is an important update on Trusts and in respect of which professional trustees and corporate service providers ought to be aware of the deadlines.”

Trusts affected by the legislative updates

From 6 October 2020, the following Trust must be registered with HMRC’s TRS.

1. All UK express trusts (unless specifically excluded);
2. Any non-UK trusts (which is an express trust):
3. and which has assets in the UK receiving income or has assets in the UK on which it is liable to pay the following taxes:
4. Income Tax
5. Capital Gains Tax

• Inheritance Tax

1. Stamp Duty Land Tax2.
2. Any non-UK trust which is an express trust but not excluded under Schedule 3A and whose trustees
3. Acquire an interest in land in the UK; or
4. Enter into a business relationship where at least one of those trustees is resident in the UK and the trust is not an EEA registered trust.

Registration deadlines

The following deadlines apply to register with the TRS:

• Trusts created prior to 4 June 2022 and not already registered as taxable trusts, the deadline is 1 September 2022
• Trusts created on or after 4 June 2022, the trustees must register within 90 days of creation
• Any changes as to the details or circumstances of a trust must be updated within 90 days of the change taking place.
• An express trust in existence on or after 6 October 2020 must register by 1 September 2022, even if it has closed prior to this date.

How to register

If these changes are relevant to you, registration must be complete by 1 September 2022 and state the trust details within 90 days, if applicable.

Registration may be dealt with online via the HMRC website, but should you wish assistance in so doing, or further information, get in touch with Harry Pattihis, Partner at Axiom DWFM, via [email protected].