The Trust Registration Service Explained
Are you a trustee? All trusts now need to be registered with HMRC's Trust Registration Service. Tax consultant Nick Giles explains everything you need to know.
The Trust Registration Service (TRS) was introduced by HMRC in 2017 to enable trustees and personal representatives to comply with their obligations under the Fourth Money Laundering Directive (4MLD).
Under 4MLD, a trust was obliged to be registered on the TRS when it incurred any form of UK tax liability, which would include a liability to income tax, capital gains tax, inheritance tax or stamp duty land tax.
The introduction of the Fifth Money Laundering Directive (5MLD) on 6 October 2020 has now extended the scope of the entities that are required to register on the TRS and increased the compliance requirements of trusts that are already registered.
The registration process requires trustees to give HMRC personal details of all individuals associated with the trust, including the person who created it (the settlor), the people who manage it (the trustees) and any individual who can receive a benefit from it (the beneficiaries), as well as details of any assets held in the trust.
HMRC finally opened the TRS for 5MLD on 1 September 2021 and all trusts with an obligation to register must be registered by 1 September 2022.
Save for a few detailed exceptions, it is now a requirement for all trusts to be registered on the TRS.
For trusts that have already registered on the TRS, 5MLD will now require trustees to “claim” the trust on the register and review the details held to ensure they are correct. Any changes must be updated on the TRS within 90 days of the change taking place and the trustees of taxable trusts must confirm annually that the trust's details are correct. The annual deadline is 31 January, in line with the self-assessment tax return deadline, and the process is carried out by confirming the details on the TRS itself and then by ticking a box on the trust tax return confirming that the details have been checked and confirmed on the TRS.
An unfortunate timing issue means that if a trust was in existence on 1 October 2020, despite the fact that the TRS was not available until 1 September 2021, it must be registered on the TRS even if it has subsequently been closed down.
Page Kirk can help you with registration and maintenance of a trust's details on HMRC's TRS. Click here for more details.
Contact us to discuss how we can help you on 0115 955 5500 or email enquiries@pagekirk.co.uk.