The HMRC opened the UK Trust Register to agents late yesterday. This is an important development in the running of trusts in the UK as it is now the only way that UK Trusts can establish their relationship with HMRC to meet their compliance obligations.
The change will also lead to developments in the advice given about how trusts are set up as well as the mechanics of reporting and paying tax liabilities. There is substantial change in the information required as well as procedural detail.
What’s next?
Trusts which have never been registered with HMRC, but had a taxable event during 2016/17 (such as Income Tax or Capital Gains Tax) must be registered with HMRC prior to the 5th December via the on-line Trust Registration process. Any trusts with a taxable event (Inheritance Tax, Stamp Duty Land Tax or Stamp Duty Reserve Tax) must be registered prior to 31 January 2018.
This is a very tight timescale and HMRC has not said what the position will be with penalties if these deadlines are missed, although we do know that new trusts will not be penalised if they register in the 7 weeks prior to the 5 December.
A trust which has previously been registered with HMRC for tax purposes will need to include details on the Trust Register, using the unique tax reference already issued, by 31 January.
We are waiting to see how the process will work in practice now that we have access to this new system. Many queries have been raised with HMRC, in particular, relating to named beneficiaries in the Letter of Wishes. We aim to provide further clarification once the detail becomes clearer.
Latest Update: Trusts Register Deadline Extended
Published: 19 October 2017
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