Common questions answered
The requirements of the UK trust register (aka Trust Registration Service) were introduced by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the ‘Regulations’) and came into force on 26 June 2017.
The Regulations implement the European Union Fourth Money Laundering Directive and seek to ensure greater transparency in respect of trust and company structures. As well as imposing certain information gathering requirements, the Regulations also require HM Revenue & Customs (HMRC) to maintain a register of.
The trust register requirements potentially apply to any trusts that have a UK tax consequence. Where a trust falls within the scope of the trust register, trustees must provide information in respect of the trust, trust assets and persons defined as beneficial owners and potential beneficiaries of the trust.
The data held on the trust register will not be available to the general public, however, it may be shared by HMRC with law enforcement authorities in the UK or another EEA member state, if requested.
Here is a link to the HMRC Guidance Notes for the full requirements.
Some common questions have been answered below, which we hope you'll find helpful:
A trust will need to register if it is:
Relevant UK taxes are defined as:
If the trust is a non-UK trust that does not have any UK source income or hold any UK assets directly it will fall outside the scope of the UK trust register.
Trustees must generally provide information by 31 January 2018, however, earlier deadlines can apply in certain circumstances.
Trustees must also inform HMRC of any changes to the trust. This must generally be done by 31 January following the end of the tax year in which the change occurred, assuming the trustees were liable to file a tax return in that year.
For trusts within the scope of the register, information is required in respect of:
The definition of ‘beneficial owner’ is wide ranging and in the context of a trust, encompasses all of the following:
Beneficiaries would include all persons named on the trust deed. Potential beneficiaries would generally include persons indicated by the settlor in a document (such as a letter of wishes) as someone who should benefit from the trust.
An individual is considered to have control if they have a power (whether alone, jointly with another person, or with the consent of another person) under the trust instrument or by law to:
The breadth of the definition of control may bring protectors within the scope of the Regulations.
The following provides an overview of the various information that will need to be reported.
In relation to the trust, the trustees must disclose:
For beneficial owners and potential beneficiaries that are individuals, such as the settlor(s), beneficiaries and persons with control, the information requirements are much more extensive than at present. The information to be disclosed includes:
For classes of beneficiaries, the trustees must provide a description of the beneficial class on the trust register. There are expected to be instances where individuals within the class need to be separately identified and reported as above, however, there is still some uncertainty with HMRC as to when this is required.
Where the beneficial owner or potential beneficiary is a legal entity (e.g. a body corporate), the trustees must disclose the following:
The information provided is held on the UK trust register by HMRC. HMRC may use the information to review the tax filings of named beneficiaries and settlors to ensure this is consistent with the information on the UK Trust Register.
The information held on the trust register is not available to the public, however, it may be shared with law enforcement authorities such as the Financial Conduct Authority, The Serious Fraud Office and the Metropolitan Police. The UK Government have confirmed there is currently no intention for any of the information to be made public.
Reportable persons will need to provide the relevant information to ensure we can accurately and fully complete the trust register. Alongside the disclosure obligations, the Regulations also impose an information gathering obligation on trustees. In particular, trustees are required to ensure they hold relevant, up to date, information for each of the persons reportable under the UK trust register.
Head of Corporate Services, EMEA
Daniel has worked in the corporate and private wealth structuring industry for over 17 years and has wide experience in providing professional director and company secretarial services to a diverse range of clients.
Client Director, Private Client
Steve has been at Hawksford for over 16 years and was appointed a director of the Private Client department in 2015.
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