From 1 September, the Trust Registration Service (TRS) expansion means more trusts will need to register with HM Revenue & Customs.
Introduced five years ago, the TRS makes the beneficial ownership of assets held in trust more transparent.
While many trusts have already signed up to the TRS, the expanding service remit now includes more trusts.
What are the changes to the Trust Registration Service?
From September, the requirement to register with the TRS will apply to all trusts, not only those with a tax liability. This includes trusts set up many years ago, which may have been forgotten about or left dormant, but remain extant.
This registration process has been open since 1 September 2021, but time is running out to complete it.
Will your trust need to register?
Under the changes, only a limited number of exemptions exist. Therefore, you likely need to register.
Other less common types of express trusts set up for specific purposes are also excluded from registration unless they are liable for tax. This rule change means that some offshore trusts will also need to register.
How do I register for the Trust Registration Service?
To comply with the registration requirements, trustees need to input details of the settlor, trustees and beneficiaries into an online portal.
At a minimum, trustees will need to confirm on an annual basis that there have been no changes and notify the TRS of any changes within 90 days.
Some trusts may have already completed a 41G form containing some details.
However, HMRC has confirmed that this did not collect sufficient evidence to meet the requirements of the new rules. Therefore, trusts that separately with HMRC previously must now use a 41G form and resubmit information via the TRS.
HMRC strongly recommends that trustees familiarise themselves with the TRS system and obtain the information required to register before the September deadline.
Speak with our Tax Partner, Tim Cook, for further guidance on the expansion of the Trust Registration Service and the steps you must take to prepare.
