Due to a change in money laundering regulations a new law has been passed whereby Trustees must now register their Trust with the HMRC. This new rule will affect any UK Trust that pays income tax, capital gains tax, inheritance tax, or stamp duty reserve tax.
You must register the details of its Settlors, Trustees and Beneficiaries. Trustees must register their trusts by 1st September 2022 or within 90 days of setting it up – whichever is later. Failure to register the Trust or maintain up-to-date information may not initially lead to a financial penalty. However, there could be subsequent offences in the future.
Who will this affect?
Anyone acting as a Trustee of a Trust is required to be registered. It is the responsibility of all the trustees to ensure registration although a lead Trustee can be nominated.
How you know if your Trust needs to be registered
This is where it becomes a little more technical! There are some exclusions as it is not all Trusts. The most obvious ones excluded are life insurance policies while the life assured is still alive and most pension trusts.
We recommend consulting with your adviser if you are unsure as to whether your trust needs registration.
Your Trust is affected – what next?
There is a clear process in place. Registering the Trust is done online through the HMRC’s Trust Registration Service accessed via the Government Gateway process. We strongly advise not leaving the registration until the deadline as it may take some time to receive the government gateway ID and password. The ‘Lead Trustee’ is the person who will need to complete an online questionnaire.
The questionnaire will ask the following:
- The name of the Trust
- The date the trust was created
- Type of Trust
- Value of the Trust
- Details of Underlying assets
As always, Legal and Medical advisers are just on the end of the telephone and happy to assist you if you have any queries.
Once the Trust is registered, you must maintain the record with any changes to Settlors, Trustees and Beneficiaries etc. Any changes should be registered within 90 days.
Legal & Medical are unable to act as agents to register your trust but we will be able to assist you with any trusts we have helped put in place. If in any doubt, do get in touch.
Are you unsure if this affects your portfolio? Let us know by leaving a comment below