Updates for the trust registration service

Actually, trust is a frame where the trustee runs the business on the part of the trust’s members who are also known as the beneficiary. A trustee can be a company, firm, an individual who runs this legally, and they also liable for debts of the trust legally and they may use the assets for paying the debts. So you have to register yourself or your company for these benefits, if you don’t register then there are some penalties also which you have to pay because since January 2018 there are penalties of fine which you have to complete: 2 years in prison, so this can be risky for you for a lifetime.

These are the information which must be given on the register

The trustee has the responsibility as well as the duty to file and complete all the tax due by paying but if there are a number of trustees, one trustee must b nominated as the lead who can contact HMRC and that lead will use for or their agent has to give the information regarding:

The name of the trustee, date of birth, national insurance number, or unique taxpayer reference number (or, residential address) and, if non-UK resident, passport or ID number of the trustee, country of issue, and expiry date, for the following individuals:

1. settlor(s) even if dead,

2. Trustees,

3. Beneficiaries,

4. All other natural or maybe legal persons doing effective control and manage over the trust (for example, a protector who can chose and appoint trustees or add or remove beneficiaries) and the nature and the way of their control; and

5. All other persons introduce as potential beneficiaries in a document or instrument regarding the trust, including a letter or memorandum of wishes from the settlor.

If a beneficiary is named under the trust deed or in the letter of wishes, HMRC considers that the trustees should give information about him, even if he is not in receipt of financial or non-financial benefits which come from the trust. The potential beneficiary is required to disclose his identity when he receives the benefits from the trust.

Trustees also are required to give information regarding the nature of the trust, namely:

1. The name of the trust;

2. The date on which it was introduced;

3. describing the assets through a statement which including the addresses of any UK properties and the assets’ market value as at the date they have come under the trust;

4. The country’s name also in which the trust is tax resident;

5. The place where it is administered;

6. Contact address; and

7. Full name of any agent who is presenting on behalf of the trustee in relation to the trustees’ registration affairs.

When registration is not required?

The complicated point for registration is a UK tax liability increasing in the hands of the trustees. Trustees of non-UK resident trust who do not contain any UK assets or have any UK source income, therefore, do not need to register even though the settlor and/or the life interest beneficiary is a UK resident and pays tax on the income and gains.

The trustees of a non-UK resident trust which contains UK assets by a wholly-owned non-UK resident company do not need to register because nonresident trusts are only “relevant” trusts if the trust fund includes assets in the UK or UK source income is produced relating that the trustees are liable to pay UK tax. If the non-UK resident company is basically holding the assets as nominees for the trustees, then the need to register would apply if a relevant UK tax liability arose. The guidance issued by HMRC in October 2017 had given that there would be no requirement to register in this circumstance but HMRC corrected this in its November 2017 guidance.

Now, here some update regarding the trust registration service

Using trust registration service in uk to register a trust is being extended as part of the UK’s implementation of the Fifth Money Laundering Directive. HMRC has published all the changes which including the registration of trust by 10 March 2022. HMRC also advised us that the updates regarding the trust registration service cannot be saved and can be back to at a later date.

HMRC’s messages are as follows:-

The Registration element of the service is not a character that we will be including in the service when an update is needed to a Trust record. Registration of a Trust involves giving a quality amount of information to HMRC. See the service to understand what information was needed;

Inform other people or organizations involved in the trust, to ascertain information required by the register; and not disclose the information input while doing the above.

Throughout user research, we did not identify a user need that highlighted the “save and return” feature or characters that were required if there are updating the Trusts record. The information captured as part of the registration is available to view/download in PDF format of the registration, or upon re-entry to the service to update the Trust record. This gives the opportunity for an Agent/Lead Trustee to come up with the information submitted and determine which information, if any, needs to be correct.