Do you have a trust in your family or are you a trustee looking after money or property for someone, such as a child?
If the answer is “yes” then from September 2022 it is likely that you will need to register the trust with HMRC.
Currently, certain trusts need to be registered with HMRC if they are liable for Income Tax, Inheritance Tax, Stamp Duty or Capital Gains Tax. But from September 2022 it will be necessary to register nearly all ‘express’ trusts, even if there is no tax to pay.
What is an ‘express’ trust?
An ‘express trust’ is a trust that was created deliberately, such as a trust created by someone’s Will or a trust that a person makes by a deed during their lifetime. This means that after a person has died, if they have a trust in their Will which continues 2 years after the death, it will need to be registered.
Examples of the kind of trusts that will need to be registered include:
- A trust holding money for a child who has not reached 18 (or 21/25 depending on the wording in the Will)
- A discretionary trust (where the money is to be held for several beneficiaries, but the trustees can decide how to use the funds)
- A life interest trust, where someone dies and leaves some or all their estate in a trust for another person for their lifetime and then to other beneficiaries when that person dies
There are a few trusts which will be exempt from registration, they include:
- Certain charitable trusts
- Trusts that are set up to be used at a later date with less than £100 in them
- Some trusts for land, pensions, and insurance policies
- Trusts imposed by law or by a court
If you are not sure, it is worth checking.
Who is responsible for Registering the Trust?
The trustees will be responsible for registering the trust. If you are an executor of a Will, you may also be a trustee. It is best to check the Will or the trust paperwork to identify the trustees.
The online Trust Registration Portal is now live and you can find lots of helpful advice on the GOV. website about registering your trust. Just go to:www.gov.uk/guidance/register-a-trust-as-a-trustee#not-register
I have just made a Will with a trust in it, do I need to register it now?
No, a trust in your Will only starts after you die. Your trustees may need to register it if the trust continues beyond 2 years after your death.
If you are not sure whether your trust needs to be registered or if you would like help or guidance in the registration process, please get in contact with Rachel Saunders at Forrester Sylvester Mackett by email firstname.lastname@example.org or telephone 01793 522688 and she will be able to offer you further assistance.