The role of a trustee is an important one. It can often feel daunting for non-professional trustees to navigate the complex trust law and regulations in place when administering a trust.
If you’re a trustee, you may have come across articles alerting you to the fact that “trusts must be registered by 1 September 2022”.
What does this mean?
TRS stands for the Trust Registration Service. The TRS keeps an online ‘trust register’ which is a record, or ‘library’, of trusts.
If you are a trustee of a taxable trust (one that pays Inheritance tax, Income tax, Capital Gains tax, Stamp Duty (or the equivalent), then the trust should have been recorded on this trust register following its introduction in 2017. You should check that this is the case.
New rules introduced on 6 October 2020 extended the scope of the trust register meaning that non-taxable trusts must also now be registered with TRS. There are some specific exclusions to this rule but on the whole, non-taxable trusts have until 1 September 2022 to register.
What’s the purpose of this?
You may be wondering, if a trust is non-taxable, why does HMRC need to know about it?
These new rules were introduced by the government to ensure that the UK has up to date anti-money laundering and counter terrorist financing regimes.
HMRC want transparency as to the ownership of assets held in trusts.
How do I know if a trust needs to be registered?
As mentioned earlier, there are some exclusions to the requirement to register. There is available guidance online, but most trusts will be required to register. You should seek professional advice if you are uncertain so as to avoid missing the deadline to register.
How do you do it?
There is an online portal on the HMRC website which trustees can use themselves to register a trust.
Alternatively, you can instruct an agent to register the trust on your behalf. Solicitors, accountants and financial advisers should be able to assist.
Trustees are obliged to keep the register updated. If any details relating to the trust change (e.g., the trustees’ names, the beneficiaries’ names or addresses etc), then you should go online and update the register. You should update the trust register within 90 days of any change to the trust’s details.
If a trust is taxable, trustees are obliged to complete an annual declaration to confirm that the trust details remain correct.