Countdown to 1 September Trust Registration Service deadline

All ‘express trusts’ must be registered with the Trust Registration Service (TRS) by 1 September 2022; part of a series of changes trustees should be aware of.

The Trust Registration Service is a website operated by HMRC which was introduced in 2017. The purpose of the TRS is to prevent money laundering, terrorist financing, minimise tax evasion and provide trustees with a way of applying for a tax reference for a trust.

Trustees are responsible for ensuring a trust is registered on the TRS, if necessary. Previously, only trustees of trusts that pay tax were required to register. Registration involves providing HM Revenue and Customs (HMRC) with information about the settlor, the trustees, the trust’s assets and the beneficiaries.

The TRS has evolved so that the majority of non-taxpaying trusts need to register. Some of the changes are:

  • Trustees of UK ‘express trusts’ are required to register regardless of whether the trust pays tax
  • New trusts must be registered within 30 days of the creation of the trust (this does not apply to trusts incorporated into a will)
  • Trustees must notify HMRC of changes to the trust. For example, HMRC should be notified if a new trustee is appointed.

You may be wondering what an ‘express trust’ is. The clearest answer is trusts that are not named in Schedule 3a of the Money Laundering and Terrorist Financing (Amendment) (EU Exit) Regulations 2020. Trusts named on this list do not automatically need to register. All other trusts are deemed to be ‘express trusts’ and should be registered, unless they are already registered.

The deadline by which ‘express trusts’ need to be registered is 1 September 2022. If an ‘express trust’ is not registered prior to HMRC’s deadline, HMRC has indicated they will send a letter to the trustees to remind them of the duty to register. If the trustees do not comply, a financial penalty will be issued to the trustees.

For legal advice on protecting your business assets, including setting up trusts, administration of trusts and estates, bare trusts, life interest and discretionary trusts, please get in touch with Tom on tom.oriordan@willans.co.uk or visit willans.co.uk for more information.

About Willans LLP

A leading South West law firm, Willans provides businesses, people, charities and not-for-profit organisations with expert, practical and personal service. In 2022, the firm celebrates 75 years in business; acting for local, national and overseas clients from its Cheltenham offices.

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