UK Trust Registration Service – Deadline Looming

28 Jul 2022

What is the Trust Registration Service

In June 2017, HMRC launched the Trust Registration Service (TRS) following the implementation of the 4th Anti Money Laundering Directive. The aim of this Directive was to improve transparency around the beneficial ownership of assets held in trusts with UK tax liabilities in a bid to identify and prevent the misuse of trusts for money laundering and terrorism funding.

On 6 October 2020, new rules were introduced as part of the 5th Money Laundering Directive which mean that a significantly wider range of trusts are now required to register with the TRS.

The new rules affect the deadline for registration of trusts and for reporting changes of registered information.

The registration deadline for non-taxable trusts which fall within the expanded TRS regime before 4 June 2022, is now extended to 1 September 2022. In addition, trusts that became registerable on or after 4 June 2022 will need to be registered by the trustees within 90 days (previously 30 days).

What Trusts Need to be Registered

The TRS applies to:

  • All UK express trusts (regardless of whether they have UK tax liabilities).
  • Non-UK trusts with UK assets and UK tax liabilities.
  • Non-UK trusts – with at least one UK resident trustee – which entered into a ‘business relationship’ in the UK after 6 October 2020.
  • Non-UK trusts which acquired UK land after 6 October 2020.

Here are some important deadlines for registering trusts on the TRS:

Non-Taxable Trusts

  • If the trust has been created prior to 6 October 2020, it must be registered by 1 September 2022.
  • If the trust exists on or after 6 October 2020 but has since ceased, it still needs to be registered on the TRS and then the record should be closed immediately.
  • If the trust has been created between 6 October 2020 and 2 June 2022, it must be registered by 1 September 2022.
  • If the trust is created on or after 3 June 2022, it must be registered within 90 days of creation.

Taxable Trusts

Set up Prior to 6 April 2021

  • The trust must be registered by 31 January after the tax year in which the tax liability arose (unless the trustees are liable to income tax or capital gains tax for the first time).
  • If the trust is liable for income tax or capital gains tax for the first time, it must be registered by 5 October after the end of the tax year in which the trustees are liable to pay income tax or capital gains tax.

Set up After 6 April 2021

  • If the trustees become liable to pay UK tax before 3 June 2022, the trust must be registered by 1 September 2022.
  • If the trustees become liable to pay UK tax after 3 June 2022, the trust must be registered within 90 days of the tax liability arising.

You are required by law to keep the TRS updated within 90 days of the date the trustees become aware of changes to the trust details or beneficial ownership.

Trustees need to understand their obligations under the TRS – for more information, help or advice regarding registering trusts, please contact Peter Alvarez on 0161 761 5231 or email theteam@horsfield-smith.co.uk.