The Trust Registration Service (TRS) is a new online service set up by HM Revenue and Customs (HMRC) to allow trusts and complex estates to meet their registration obligations and obtain their self-assessment unique tax reference (UTR). The TRS replaces the paper 41G form (trusts), which are no longer available from HMRC. The TRS has been introduced to meet the requirements of the updated Money Laundering legislation that came into force on 26 June 2017 and forms part of HMRC’s digital strategy which will provide greater tax transparency moving forward.
Both new and existing trusts are obliged to register using the online Trust Registration Service (TRS) system where the trustees have a liability to one or more of the relevant UK taxes being; income tax, capital gains tax, inheritance tax, stamp duty land tax or stamp duty reserve tax.
To enable trustees to complete the Trust Registration Service (TRS), trustees must register with HMRC using their secure online government gateway service. The Trust Registration Service (TRS) asks for personal and contact details of all trustees, Settlors, and beneficiaries including full names, dates of birth, addresses and National Insurance numbers.
The Trust Registration Service (TRS) also requires details of the assets put in the trust and their market value at the creation of the trust.
The trustees do not need to complete the Trust Registration Service (TRS) in the following circumstances:
1. Where no liability to any of the relevant UK taxes arises due to the claim of a tax relief.
2. Where there is no requirement to file a tax return and no tax liability has arisen.
3. Bare trusts are not required to register as they are transparent for tax purposes and no trust liability arises.
4. Where trust income is paid directly to a UK beneficiary and no income is reported on the trust return.
5. Where trusts have no other liability other than a tax liability of less than £100 arising on bank or building
6. Statutory trusts.
Registration must be completed by 31 January following the end of the relevant tax year for trusts previously registered for Self Assessment with HMRC that have incurred a relevant UK tax liability. Registration must be completed by 5 October following the end of the relevant tax year for new trusts not previously registered with HMRC for Self Assessment, where an income tax or capital gains tax liability has arisen for the first time. Where a new trust has a liability to any of the other relevant UK taxes for the first time, the registration deadline is extended to 31 January following the end of the relevant tax year.
HMRC expect trustees to maintain the details included on the TRS by 31 January following the end of the relevant tax year.
Unfortunately, it is not possible for lead trustees and their agents to update their registered information or to declare that there have not been any changes on the TRS due to limited functionality. HMRC are implementing the TRS in a number of phases and we await updates to the service.
COMPLETING THE TRS
The primary responsibility for registration lies with the trustees, however, trustees may wish to appoint an agent
such as Albert Goodman to register the trust on their behalf. Unfortunately, the Trust Registration Service (TRS) is an additional administrative burden that the trustees must comply with, failure to do so may lead to penalties being raised. HMRC are yet to release details of the penalty framework that will apply to failures to comply but please contact us for further help and advice where necessary.