Wills Trust and Property Protection Trust – register it now

Suzanne Porter Suzanne Porter 18 January 2022

The scope of Trusts that have to be registered with the Government has been significantly widened - with action needed by many lay Trustees.

Trustees obligations, as part of the Fifth Money Laundering Directive to maintain and provide information about trusts and their beneficiaries to HMRC’s Trust Registration Service, have been expanded for certain types of Trusts.

The types of trusts that will need to be registered now include:

UK express trusts – in the format of Wills Trust/Property Protection Trust

Non-UK resident trust acquiring UK real estate

Non-UK trusts with UK trustee entering into a business relationship with a UK obliged entity

Pension trusts

Complex estates

Suzanne Porter, director and head of the private client team at Wake Smith, discusses how Wake Smith can register Trusts taking the stress and time away from the Trustees.

“HM Revenue & Customs have now made it a mandatory requirement to register a Trust on their online Trust Registration Service, including an express Trust, which is created by a persons Will and comes into effect on their death.

“This means there will be a large number of trusts that are now required to register, many with lay trustees.

“There has been concern that this will drastically increase the compliance burden on trustees and mean that some trustees may be in breach of the registration requirements without even being aware of them.

“Late spouses’ Wills do include Express Trusts in the format of a Property Protection Trust and as a Trustee of the Will Trust, it is their duty to register that Trust on their online service.

“Many people will not be aware of this requirement and know what to do to exact the registration and avoid untimely reminders and financial penalties.”

The deadlines

Draft regulations to extend the deadlines imposed on trustees for registering with, and updating information about trusts with the Trust Registration Service (TRS) have been published.

The draft Money Laundering and Terrorist Financing (Amendment) Regulations 2022 amend the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.

The draft proposals, if approved by Parliament, come into force on 9 March 2022.

Trusts originally required to register by 10 March 2022 now have until 1 September 2022.

Registration deadlines for trusts that become registerable after 1 September 2022 will have 90 days rather than 30 days.

There is also an extension to 90 days for the time limits for trustees keeping information held on the TRS up to date.

What is the UK Trust Register?

The register was started in 2017 and has two objectives:

To act as a vehicle for trusts which are liable to UK income tax or capital gains tax to register with HM Revenue & Customs (HMRC)

To maintain a central register of the beneficial ownership of tax paying trusts and fulfil the UK’s obligation under the EU’s Fourth Money Laundering Directive.

All trusts which have UK tax liabilities (income tax, capital gains tax, inheritance tax or stamp duty) are liable to register, whether or not the trustees are UK resident.  It is not a public register with the information only available to government authorities.

If you have any queries about trusts, registering trusts or exclusions please contact Suzanne Porter at Wake Smith on 0114 266 6660.

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