HMRC published further amendments to the Trust Registration Service (TRS) Manual on 14 April 2022.
These updates included:
- Clarification that an express trust that was in existence on or after 6 October 2020 but which has subsequently been closed requires to be registered on the TRS unless it was an excluded trust. Once registered, the trust’s details should then be updated to mark it as closed. The deadlines for registration remain by 1 September 2022 or within 90 days of the date of creation of the trust, if later.
- When a trust is registered, all “beneficial owners” of the trust at any time since 6 October 2020 should be recorded at the point of registration. Any individuals who have since ceased to be beneficial owners can then be removed. This ensures that the TRS contains a record of all beneficial owners from the time the trust became liable for registration. Beneficial owners include settlors, trustees, beneficiaries and other individuals with control over the trust (such as protectors etc).
- Whilst the TRS Manual previously confirmed that Child Trust Funds are not trusts and, therefore, not subject to registration, there had been some uncertainty around whether Junior ISAs (JISAs) require registration. HMRC has now confirmed that JISAs are not trusts and do not require registration.
We have also been in correspondence with HMRC to seek further clarification around the types of life assurance policies that can allow a trust to be an excluded trust for the purposes of registration. Unfortunately, several grey areas remain; we will seek further clarification from HMRC and hope to be able to provide further details in a future bulletin.
Whilst pilot trusts, including bypass trusts, set up before 6 October 2020 which currently hold assets valued at less than £100 are excluded trusts, any pilot trusts set up after 5 October 2020 (and pre-6 October 2020 pilot trusts holding assets worth more than £100) require to be registered on the TRS. This has caused considerable disquiet amongst a number of advisers as such trusts may never receive significant assets.
Trustee Support Services has developed documentation to create a bypass trust that does not require registration on the TRS until such a time that it receives additional assets or incurs a tax liability. Whilst this documentation cannot be used to amend existing bypass trusts, we believe that it may be of significant interest to many advisers. If you are interested in acquiring a licence to market this, please contact us at firstname.lastname@example.org and we will be happy to provide full details.
Trustee Support Services can register trusts on behalf of the trustees and also provide bespoke consultancy services to trustees and their advisers.