TRUSTS - 19.01.2018

HMRC’s trust registration debacle

What’s the TRS? The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 , which have applied since July 2017, require trusts to register with HMRC. Trustees, or their advisors, must give details of the trust’s assets, the settlors (those who gave assets to the trust), trustees, beneficiaries and anyone else who can control the trust’s assets. Registration has to be through HMRC’s new Trust Registration Service (TRS). The trouble is the service wasn’t well advertised and still isn’t fit for purpose.

First deadline. If HMRC has already been notified of the trust for tax purposes for 2016/17, the TRS registration deadline is 31 January 2018. The good news is that HMRC has agreed not to charge penalties if the deadline is missed as long as the trust is registered before 6 March.

Second deadline. Trusts which needed to register for the first time in 2016/17 ought to have done so by 5 October 2017. The TRS was the only way to do this, but it wasn’t working by then. The deadline was put back twice, but finally passed on 5 January 2018, even though there are still problems. At the time of publication HMRC hasn’t said whether it will apply penalties if you’re late. In view of its epic failure we hope it will take a lenient approach - we’ll keep you posted on any developments.

Tip 1. Your accountant or advisor can register on your behalf. They will probably have more experience of working around the problems with the TRS. They will need to create a special TRS login, i.e. they can’t use the general one for dealing with clients’ tax affairs.

Tip 2. If you want to tackle the process yourself we’ve produced a short guide on how to deal with some of the problems you might encounter (see The next step ).

For how to tackle problems with the TRS, visit http://tipsandadvice-tax.co.uk/download (TX 18.08.01).