Law spot by Harold G Walker Solicitors

Estate Administration and the Trust Registration Service

By James Rust, Private Client Solicitor and Associate

Following the introduction of the Trust Registration Service (TRS), HMRC now require some estates to be registered on the TRS.

The registration of an estate is mandatory if certain circumstances apply. Failure to register an estate could result in large penalties.

If administration of the estate cannot be completed within two years of the date of death, the estate must be registered on the TRS. This will depend on the construction and wording in the will but essentially, if the estate is left to the Executors ‘upon trust’ for the beneficiaries named in the will, then a trust has been created and must be registered if the administration exceeds two years.

There are various circumstances within an estate which will require administration.

If the executors decide to vary the contents of the will after the testator has passed away, then a new trust is created, and the varied estate must be registered on the TRS within 90 days of the variation. If assets are appropriated to beneficiaries, usually to minimise the amount of inheritance tax due on the estate, or to maximise the value of the reliefs available to be claimed, then unless the transfer of the assets take place on the same day as the appropriation, a trust is created and will also need to be registered.

There are other circumstances that will also require registration, so if you have any doubts over the need for registration of an estate, register in any event to avoid being considered non-compliant.

Law Spot is for information only and does not constitute legal advice.