Trust Registration: Important Deadline Approaching

We want to make all Trustees aware of an important deadline which is fast approaching. It affects those Trusts which have not previously been required to register with HMRC as there has been no tax to report.

HMRC now require Trusts to be registered with them even if there is (and has been) no tax to report.  As a result, a whole swathe of previously unaffected arrangements are now required to log their details with them.

Who is affected?

Many Trusts will already be registered and Trustees will be in the habit of submitting annual tax returns.  However, there are Trusts such as those which do not generate income or capital gains (e.g. those which contain only loans, or life insurance investment bonds) which will now need to register. 

Additionally, investment accounts set up for the benefit of others (typically children or grandchildren) via a designation, will also need to comply if they wish for the accounts to be taxed in the hands of the child/grandchild concerned.

For full details of who is affected you can read more here.

For the avoidance of doubt, pure life insurance policies held in Trusts which only have a value in the event of death or surrender need not apply.

The Deadline Detail

Trusts in existence on the 6th October 2020 (whether in existence now or not) and any Trusts created since, need to be registered by 1st September 2022, or within three months of creation whichever is the later.

What Next?

Fortunately, the process is relatively straight forward if you choose to do this yourself.

The Trust needs to be registered via the Government Gateway service here by a nominated ‘Lead’ Trustee.

The greatest difficulty may lie in gathering the required information to complete the registration.  The following is required:

Generally

• the name of the trust.
• the date the trust was created.
• to say if the trust is an express trust or not.
• details about whether a non-UK trust has a business relationship in the UK.
• details about any UK land or property the trust has purchased.

For the Lead Trustee

• name
• date of birth
• National Insurance number and address (if they’re a UK citizen)
• passport details and address (if they’re not a UK citizen)
• telephone number
• country of residence
• country of nationality

For Settlors, Trustees and Named Beneficiaries

• name
• date of birth
• country of residence
• country of nationality
• mental capacity at the time of registration — HMRC will assume the individual has mental capacity, unless you tell us they do not

Ask your Accountant to help?

Many of our clients will already have in place accountants or professional tax advisors who will have familiarity with this process and may already have been in touch to help with this.  Asking them to assist would likely be an efficient way to handle it once the abovementioned information has been provided.

Unfortunately, bdb will not be able to directly register any Trusts.  However, we do want to help as far as we possibly can. Please do get in touch if you need our help in gathering the information required.