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HMRC Compliance - Trust Registration
HMRC introduced their 'Trust Registration Service' back in 2017, but since then there has been an expansion of which trusts are required to register. From September 2022, all 'express trusts' needed to be registered, even if there is no tax to be paid by that trust.
In recent guidance, HMRC explained the burden on professionals, such as solicitors, to obtain evidence of registration of a trust with HMRC.
From September 2022, legal professionals and other professionals acting for trusts, must ask trustees or agents who are engaging in a new business relationship with them to provide proof of registration on the Trust Registration Service.
The trustee or agent who is engaging in the business relationship will need to use the online service to download a PDF copy of a report to show proof of registration. This report can be emailed to the relevant professional or alternatively, can be printed off.
If a relevant professional finds a discrepancy in trust data when reviewing proof of registration, these organisations will seek to resolve this directly with the trustee or agent who is engaging in the business relationship in the first instance. For example, by pointing out the discrepancy and asking them to update the proof of registration and provide the updated version. If a relevant professional cannot resolve the discrepancy directly with them, they must then report the discrepancy to HMRC.
HMRC will write to trustees if a discrepancy is reported, asking for the discrepancy to be resolved. If the trustee wishes for their agent to action the discrepancy letter, they must pass this onto their agent themselves.
Once the trustee or agent has made the appropriate changes, they should download a new proof of registration document and supply this to the relevant person. If the relevant person is satisfied that the discrepancy has been resolved, they can continue to engage in a business relationship with the trust.
As such, it will become common practice for professionals, such as solicitors and accountants to ask for evidence of registration of trusts with HMRC. Here at Chattertons Solicitors, we can help you to deal with any trust registration issues you may have, or provide other guidance you might need.
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If you need legal advice regarding any Wills, Trusts & Probate matters please contact our specialist Wills, Trusts & Probate team