Tax update: Trust registration service – keeping records up to date

The trust registration service (TRS) was introduced in 2017 as part of HMRC’s wider digital strategy and required taxable trusts to register online rather than via paper forms. The TRS also enacted the EU’s fourth and fifth money laundering directives.

With effect from October 2020, the scope of the TRS was significantly expanded with a requirement for all UK express trusts (and some non-EU resident trusts) to register on the TRS regardless of whether they have a UK tax liability.

Any new trusts created now have 90 days to register from the date the trust is brought into existence, unless they qualify for an exemption. Further, trustees have an obligation to keep the TRS record up to date. Any changes to the information held on the TRS should also be made within 90 days of the date that the trustees become aware.

The key changes which may need updating on the TRS include:

  • changes to the trust details (including a change in trustee or change of address of the lead trustee);
  • changes to the beneficial owners of the trust (e.g. a distribution to a new beneficiary not already named on the TRS or the death of a beneficiary); and
  • the winding up of a trust.

Unlike with taxable trusts, there is not a requirement to provide an annual update or confirmation to the TRS. There is a higher risk, therefore, that any changes may not be picked up and updated on the TRS for non-taxable trusts.

HMRC have confirmed that a first failure to keep information on the TRS up to date will just result in a warning letter and no penalty, however, future failures could be subject to penalties of up to £5,000 if it is shown to be due to deliberate behaviour on part of the trustees.

Please get in touch if you need any advice on whether a trust may be registerable or for assistance with registering a trust or updating your existing TRS record.

Our People

Find the Hazlewoods person you need – and get to know our team.

Got a Question?

Find out more about us, and we can find out more about you.