Back in 2017 HM Revenue & Customs introduced the Trust Registration Service (TRS) as part of the Fourth Money Laundering Directive. This required all trusts with a tax liability to register details of the settlor, trustees, beneficiaries and trust assets on the service and maintain the details on the register thereafter. The tax liability could arise from income tax, capital gains tax, inheritance tax or stamp duty land tax.

The Fifth Money Laundering Directive has since been released and now greatly expands the TRS to include a larger pool of Trusts. The latest regulations now mean that the following trusts need be registered on the service:

  • All UK express trusts (unless there is a specific exclusion)
  • Certain non-UK express trusts if they have links to the UK e.g. UK trustees or acquiring land in the UK
  • Non express trusts and specifically excluded trusts if they have a tax liability

There are certain trusts that are excluded from the regulations and these include:

  • Trusts imposed by law e.g. a trust arising from intestacy
  • Trusts imposed by the court
  • Life insurance polices
  • Charitable trusts
  • Child bank accounts
  • Pilot trusts set up before 6 October 2020 holding less than £100
  • Pension schemes
  • 18-25, bereaved minor and vulnerable beneficiary trusts
  • Co-ownerships trusts holding jointly owned property, providing the trustees and beneficiaries are the same people

The term “express trust” covers trusts set up formally by deed, within a will or by a declaration of trust. It therefore covers trusts that you may not think of as being formally set up. Typically, this would be a trust of jointly held property. There is an exemption where the trustees and beneficiaries are the same but in many cases they may not be, most commonly in partnerships.

All Trusts which now fall under the new regulations must be registered on the TRS by 1 September 2022 or within 90 days if the trust was created on or after 1 June 2022.

If you have a trust which meets the registration criteria please get in touch and we will be happy to help. We can help with all stages of the TRS, either supporting with full registration, ongoing monitoring and updating or helping you to negotiate the process yourself.

Rebecca Oatley is an Associate Partner at A C Mole and part of the Tax Team. Rebecca can be contacted at our Taunton office.