The TRS was introduced in 2017 as part of an EU anti-money laundering directive. Until 6 October 2020 only express trusts that incurred a UK tax liability were required to register with the TRS.
From 6 October 2020 all express trusts are required to register with the TRS regardless of whether they have a UK tax liability, unless the trust is specifically excluded. Access to TRS is currently restricted to government authorities but this will be extended to anyone with a ‘legitimate interest’ under the new regulations.
Common exclusions include:
- Pension schemes
- Will trusts wound up within two years of death
- Charitable trusts
- Trusts for persons with a disability
- Co-ownership for assets owned jointly as ‘tenants in common’
- Policy trusts paying out on death or critical illness
- Bank accounts for minors
All non-taxable trusts in existence before 6 October 2020 which are required to register on the TRS must do so by 1 September 2022.
For trusts created after 6 October 2020 registration must take place within 90 days of creation.
Registration of Trust
The legal responsibility for registration falls upon the trustees. The trustees must appoint a lead trustee for the trust and become the appointed person for the register. Alternatively, trustees can appoint an agent, such as Dafferns, to register and maintain the trust on behalf of the trustees.
The details which must be declared on the TRS include the name of the trust and date of creation, details for the settlor, trustees, and beneficiaries of the trust together with details of any UK land or property purchased and other trust assets.
The lead trustee is required to update the register for any changes in trustees or beneficiaries within 90 days of a change occurring. If the trust details remain the same, the trustees are required to submit an annual declaration to confirm the details held on the register are accurate and up to date.
HMRC may issue a penalty if the lead trustee has failed to register, update the register in time or submit an annual declaration by the deadline.
At Dafferns we can help trustees to understand their obligations under these rules and assist with the registration process and maintaining the trust.
Please contact us for help in registering and maintaining your trust.