Does your trust or family arrangement need to be registered with HMRC?

Many family arrangements on the way property is held or managed are being caught by HMRC’s registration requirements.

If you are a trustee, beneficiary, hold property for someone else, or benefit from property held by another person, you may need to register with HMRC under the new online Trust Registration Service (TRS).

HMRC has extended their requirements for all trusts in existence on or after 6 October 2020 to register, even if they do not have a UK tax liability. There are some exceptions which are detailed in the Government guidance.

Importantly for most families, this now includes a requirement to register Declarations of Trust where the legal owners and beneficiaries differ. For example, you may hold a property under a Declaration of Trust where someone else has an interest or benefit. Or you may have another type of arrangement where someone holds property, money or other assets for the benefit of another person.

There are also obligations for the upkeep of records and information about the trust on the TRS.

This is a complex area and the deadlines depend on the type of trust and whether there is any tax liability. We recommend you do not delay in looking into this as there may be financial penalties involved.

Next Steps

If you are a trustee or beneficiary or involved in an arrangement where property or other assets are held by a person but someone else has the benefit, please get in touch and we can consider this further for you.

We can also advise separately on the administration, creation or termination of a trust if you would like to explore planning options for you and your family.

For more information please contact Michelle Crump on 01752 827922 or by email on mc@wysolicitors.co.uk.