Are you ready for the HMRC Trust Registration Service?

If you are a trustee of a UK trust, or a non-UK trust with certain UK connections, you are required to take action under the Money Laundering Regulations (the Regulations) and register your trust with the HMRC Trust Registration Service (TRS).

Do I need to register?

The Regulations first came into effect in June 2017 and were amended on 6 October 2020 to widen the categories of trusts that must now be registered by 1 September 2022. The trusts which must be registered are:

• all UK express trusts (with some limited exceptions); and
• non-UK express trusts that acquire land or property in the UK or have at least one trustee in the UK and enter into a new business relationship within the UK (on or after 6 October 2020).

The trustees may be required to register the trust with the TRS even if it does not have a UK tax liability, although there are some exceptions to this such as charities and life insurance policies written in trust.

How do I register?

Trustees must register the trust online via HMRC’s website at: https://www.gov.uk/guidance/register-a-trust-as-a-trustee.

You will be required to create a Government Gateway ID account and you should have the relevant information and documentation relating to the trust to hand as you will be required to provide information about:

• when the trust was created and where it is administered;
• the settlor;
• the trustees;
• the beneficiaries;
• the trust assets (although this is not the case with all trusts);
• other specific information relating to UK business relationships and interests in UK land (for non-UK resident trusts); and
• details of any UK tax liability arising to the trust.

The TRS has been designed so that trustees can easily register trusts themselves. However, it is possible for an agent, for example a lawyer or accountant, to register the trust on behalf of the trustees if this is preferred.

What are the deadlines for registration?

Trusts created on or after 1 September 2022 must be registered within 90 days of creation.

Trusts created before 1 September 2022 but on or after 6 April 2021 must be registered by 1 September 2022.

Trusts created before 6 April 2021 must be registered by 31 January after the year in which a tax liability occurred or by 5 October after the end of the tax year for the first year of liability to income tax or capital gains tax.

Trusts that are subject to a “triggering event” such as entering into a new UK business relationship, acquiring an interest in UK land or if it is a Will trust that continues for longer than 2 years from death of the testator, must also be registered within 90 days of the event.

Penalties for failing to register

Failing to register with the TRS could result in a penalty of £5,000 per offence.

Does the TRS record need to be updated?

The TRS record for the trust should be updated within 90 days of any change, for example, the appointment and retirement of trustees.

In addition, the TRS record should be reviewed annually, by 31 January each year, even if this is only to confirm that there have been no changes.

The TRS is also reviewed and updated online on the HMRC website at https://www.gov.uk/guidance/manage-your-trusts-registration-service.

A recent Freedom of Information request has confirmed that over 60,000 trusts have been registered with the TRS in the first half of 2022 and it is estimated that 1 million trusts will be required to register by 1 September 2022 deadline.

We hope that this note has provided helpful guidance to enable you, or your clients, to register their trust(s). If you would like a more detailed briefing note, have any questions or need any help please contact a member of the Private Client team, who would be happy to assist.

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