The Money Laundering, Terrorist Financing and Transfer of Funds (Information of the Payer) Regulations 2017 introduced a requirement that trustees of trusts which have a tax liability (such as Inheritance Tax, Capital Gains Tax, Land and Buildings Transaction Tax etc) register specific information about their trust with HMRC - e.g. the names and dates of birth of the Trustees and Beneficiaries, contact details and the National Insurance Number of the lead trustee etc. Registration is completed online through HMRC’s Trust Registration Service (TRS) and it is the responsibility of the trustees themselves to identify whether their trust requires to be registered.
Since 2017, the European Parliament’s ‘Fifth Money Laundering Directive’ has been adopted into UK law and the Money Laundering, Terrorist Financing and Transfer of Funds Regulations were amended accordingly in 2019. The Regulations now require that all trusts be registered by the later of 1st September 2022 or within 90 days of the trust’s creation unless the trust falls into a specifically excluded category and also has no tax liability. The excluded categories include:
HMRC have indicated that they will begin issuing penalties to trustees for failure to comply with registration requirements immediately after 1st September 2022. These penalties will directed at trustees personally, as opposed to being payable by the trust, and will be to the value of:
As such, trustees should not delay in gathering all of the relevant information they will need for registration. If you would like advice on trust registration and any other trust- related issues, please do not hesitate to get in contact with our Private Client department.