Are you a trustee of a trust created by a will or lifetime settlement? If so, there are new trustee obligations to fulfil with HMRC before 1st September 2022.
Most UK and some non-UK trusts now need to be registered with HMRC, regardless of whether a trust is taxable or non-taxable. The new rules were introduced on 6th October 2020 as part of the UK’s implementation of the Fifth Money Laundering Directive. Trusts in existence on or after this date will need to be registered, even if they have terminated before the deadline to register.
Since the new rules were introduced, HMRC’s guidance has been updated frequently, so it can be hard for trustees to keep on top of the changes as and when they happen.
A recent update includes the requirement to register a Co-ownership Property Trust, where the legal and equitable interests in a property are not the same. This can result in a separate registration from that of the trust to which the property is subject.
The trustee obligations do not end once a trust has been registered. In fact, trustees are required to update the trust details and maintain the register for as long as the trust is in existence.
HMRC have recently confirmed that fines/penalties may be issued to trustees where deliberate failure to register a trust is identified.
Exclusions can apply to certain types of trusts or for a period of time from a trust’s creation. However, if a trust becomes taxable, any exclusion currently in force comes to an end and the trust will need to be registered in accordance with the Fourth Money Laundering Directive.
We can help you
If you are appointed as a trustee and you would like to ensure that you have met all of your trustee obligations, then please do contact us. Our Trusts Team is here for you. Visit https://www.porterdodson.co.uk/trust-law-solicitors or call 01823 652127.
We handle a variety of trusts and settlements and we offer high quality, cost-effective legal advice on such matters.