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Trust Registration – guidance update by John Bunker, Consultant Solicitor and Chartered Tax Adviser and Naomi Neville, Senior Associate

What is the trust register?

The TRS was introduced in June 2017 to register trusts where there was a UK tax liability arising. In October 2020 new legislation was introduced to capture all trusts, unless within specific exclusions, regardless of whether or not there is a UK tax liability.

When is registration required?

All existing non-taxable trusts, unless excluded, must be registered before 1 September 2022. After September 2022 all registrable trusts must be registered within 90 days of creation (or within two years of death if a Will trust). There are some exclusions covering some specific forms of trust but the extent of the exclusions can seem a bit random, even unfair. 

Which trusts need to be registered? Most recent guidance:

It might be thought obvious for trustees to know whether or not they have a trust which needs to be registered, but the matter is not so straightforward, and executors and trustees should consider the guidance carefully and seek specialist legal advice if they are not sure how to remain compliant.

Over the last couple of years, HMRC have issued detailed guidance to help trustees decide whether they need to register their trusts, and Irwin Mitchell’s John Bunker has played a key role in contributing to the content of HMRC’s TRS Manual on the subject.

The most recent major update to the TRS Manual in February 2022 covered guidance on registration of estates and trusts created on death, particularly where property assets are involved, but crucial guidance was missed out.  HMRC have this week confirmed that the guidance applicable for registration where property is left in a will trust is as follows:

  • The will trust may need to be registered, although if the will trust it is to be wound up as part of the administration and does not continue to exist beyond the second anniversary of the testator’s death, then the will trust is excluded from the need for registration. If the will trust is to continue beyond the second anniversary of the death, the trustees can register early should they wish, but are only obliged to register once the second anniversary has passed

  • The property trust might need to be registered unless excluded by virtue of the legal and beneficial owners of the property being the same after the death of the testator, or by virtue of the property being wholly owned by the deceased and passing into the will trust which is then wound up within the two years following the death.

Further information about the forthcoming update to include these key examples is covered in more detail in a recent technical article by John Bunker, to be published shortly. Please contact us for more information. HMRC are about to update their TRS Manual to include these additional details.

I am a trustee and I’m not sure if my trust needs to be registered, what should I do?

If you are not sure whether or not your trust needs to be registered our expert trust advisors would be happy to discuss your responsibilities with you, and advise you on whether or not your particular trust needs to be updated.

We can also review the terms of the trust and consider whether there are ways in which your trust can be amended so that it is excluded from the need to register.

How do I register a trust?

Trustees or their agents can register a trust using the UK ‘Government Gateway’ facility after setting up an account online. Our specialist trust compliance team can support with a full range of compliance and administration issues, and can register your trust for you too.

What is required after registration?

Registration is not a one-time consideration, trustees are obliged to maintain accurate and up-to-date written records and have an obligation to notify HMRC if details of trustees, beneficiaries etc. they have supplied change.

Please do not hesitate to contact us if you have any questions regarding the trust register