Are you aware of your obligation to register the Trust with the Trust Registration Service?
The Government has introduced a new system requiring all Trusts which fit certain criteria to be registered with HMRC. This includes many Trusts which Trustees may consider “dormant” or which are inactive.
Any Trust which was in existence on 6th October 2020, whether or not the Trust is currently active; has been wound up in the intervening period; or is likely to be wound up shortly, needs to be registered. This applies to all UK Trusts, whether or not the Trust is liable to pay tax, unless the Trust is specifically excluded. This also applies to non-UK Trusts which acquire land or property in the UK or have at least one Trustee resident in the UK.
Trusts which are excluded from compulsory registration include the following:
- Pension Trusts
- Life policies that pay out on death or critical illness
- Charitable Trusts
- Existing Pilot Trusts with a value of less than £100 that were set up prior to 6 October 2020
- Will Trusts that are wound up within two years of death
- Policy Trusts paying out on death or critical illness
It is the responsibility of the existing Trustees to ensure that they effect registration with HMRC or they risk being fined for failing to comply.
Be warned – the registration form requires a good deal of detail. You will need full details of all the Trustees, the Settler and the beneficiaries together with details of the Trust’s assets.
This information may not be readily be available to the Trustees. Indeed, the Trustees may have lost touch with each other or with the beneficiaries. Therefore, action is required now, to ensure that those details are obtained in good time to comply with registration requirements.
Here at Barrett & Co Solicitors, we have been reviewing our records and contacting all Trustees known to us to remind them of their responsibilities.
If you think your Trust needs to be registered, and you are uncertain as to what to do, please contact us at email@example.com, using the wording “Trust registration query”, and we shall endeavour to get back to you as soon as we can.