New trusts which need a UTR number in order to report an income tax or CGT liability for the first time in 2016/17 need to be registered by 5 January 2018. This is an extension for the first year of the TRS only from 5 October 2017.
Existing trusts need to be registered through the TRS by 5 March 2018. This is an informal extension of the deadline from 31 January 2018. The HMRC news on gov.uk still shows a deadline of 31 January 2018 for existing trusts, but HMRC have confirmed to the ATT and CIOT that penalties will not be imposed for trusts registered by 5 March 2018. This applies for trusts already registered for self- assessment and those which do not require to be registered for SA as there is no reportable tax lability.
Tax agents should now be able to access the TRS directly and set up an Agent Services account (ASA) at the same time. You should not have to wait for HMRC to approve your application by email. Also the 2-step verification process is not mandatory to operate the ASA.
The TRS process has been tweaked so you can save the submission of data to the TRS after sending. This will provide you with proof of the data submitted through the TRS. You can also use dummy information where certain data could not be ascertained, such as the NI number of a deceased settlor.
Where a beneficiary is named, the trustee, or you as the tax agent, will still need to provide the relevant details. However, details of named beneficiaries whose benefit is contingent on an event occurring, do not need to be reported until the contingent event has occurred.
Where a beneficiary is not named, as they are part of a class of persons, a trustee only has to identify individuals when they receive a financial or non-financial benefit from the trust after 26 June 2017. The class of beneficiaries should be reported as described in the trust document.
HMRC has updated its draft guidance on the TRS which includes more examples. The ATT has also produced some excellent and comprehensive guidance on the TRS which is freely available for anyone to download, you don’t have to be an ATT member to access that guidance.
There will be a penalty regime for late or incorrect registrations of trusts through the TRS, but HMRC has not indicated what form those penalties may take.
In a statement to the professional bodies HMRC said:
“The Trust Registration Service (TRS) is an important tool for the UK government in meeting its obligations to tackle money laundering and it is important that the register is complete, but it is also important that we enable and support trustees and agents to comply with these new requirements, rather than simply enforce non-compliance”.