3 minute read
Yet Another Lockdown
Private Client Update
H M Revenue & Customs – Trust Registration Service
In 2017, the Trust Registration
Service (‘TRS’) was introduced by H M Revenue & Customs following the adoption of the 4th Anti Money Laundering Directive by the UK Government. The TRS currently applies to relevant taxable trusts.
Until recently trustees were only required to register a Trust if the trust became or was liable for any of the usual taxes, such as Income Tax, Inheritance Tax, or Capital Gains Tax etc.
Following the Fifth Money Laundering Directive and updated Trust Registration Service which came into effect from 5th August 2020, the requirements have been extended to include most trusts, not just those with a tax liability under the current rules. This means that all trusts in existence at 10th March 2020 (with the exception of a limited number of trusts – see below) must be registered on the Trust Registration Service. There is currently a transitional period whereby the deadline for new registrations or providing the additional information required is extended to 10 March 2022. After this time, all relevant trusts that are not already on the register and fall into the reporting requirements to register on the TRS will have 30 days from 9 February 2022 to register in time for the 10 March 2022 deadline. Failure to register a relevant trust may incur a penalty.
In addition, once a trust is registered on the TRS the trustees of registered trusts which incur UK tax liabilities, must notify H M Revenue & Customs of any changes to registered information within 30 days from the date the trustees become aware of the change. Trustees should be aware of this requirement as failure to comply may also result in a penalty being issued.
Certain categories of trusts are excluded from registration and, broadly, include trusts that are already required to register in some other way, or are considered a low risk of being used for money laundering or terrorist financing. The types of trusts exempt from registration on Trust Registration Service, include UK-registered pension trusts, UK regulated charitable trusts, Pilot Trusts holding assets valued at less than £100, until further assets are added, amongst others.
It appears that HMRC have chosen NOT to exempt bare trusts from registration.
Trust law is increasingly specialist, as the obligations placed upon Trustees become more and more onerous. Many insurers now consider trust work to be high risk, and firms without a specialist trust team or practitioner may wish to refer to other Hertfordshire Law Society firms with the requisite expertise.
Claire Sharp TEP
Partner and Head of Trusts Debenhams Ottaway LLP
Yet another lockdown
Well although there is another lockdown we do have great news in the
household. Both my hoomans have had their first vaccination. I can’t understand why they are so excited as I hate it when I go to the vet for my annual check up and jabs. My mother also got excited just by going to the dentist – why?
I like to help my mother with her work but I’m not sure that she thinks I am a great help. She has moved where she works so she can shut the door and stay lovely and warm. When it reaches the right temperature I sneak in to join her.
My mother hasn’t been letting anyone in the house so I haven’t seen one of my favourite people for ages. I’m getting very fed up of not having any visitors. I did bring a live mouse in that I had hoped to keep as a pet but unfortunately it died in the under stairs cupboard without any help from me! I also wanted to keep a pet bird but my father wouldn’t let me!
The only good thing is that they are not going away at all so they can spend a lot of time with me. They do seem to have a lot of “teams” or “zoom” meetings.
Hopefully by my next article I will have something to report. Stay safe and have the vaccination if offered it.
