“The immanent extension of the online UK Trust Registration Service (TRS) to cover express trusts without any tax consequences, under the EU Fifth Anti-Money Laundering Directive (5AMLD), is likely to extend the number of registrable trusts from around 200,000 to as many as two million, according to the Association of Taxation Technicians”, STEP reported in October 2018.
A brief update on the trust register and recent developments.
Although the relevant legislation came into force on 10 January 2020, both the legislation and the explanatory memorandum which accompanied it are silent on the trust registration requirements.
A little background.
In April 2019, HM Treasury launched a consultation on the transposition of AMLD5 into UK law. In the consultation paper, the government indicated that a more detailed technical consultation would be run by HM Revenue and Customs in respect of the trust registration requirement, in which the government would confirm its approach on various points and consult on matters such as the appropriate penalty framework for the regime.
HMRC has provided updates to certain professional bodies including the Chartered Institute of Taxation. In the updates, HMRC advises that the technical consultation will be published in early 2020 and the registration requirement transposed into domestic law during 2020. No dates are given. The technical consultation will include draft legislation for the registration requirement, as well as additional information on matters such as the type of express trusts that will be required to register and penalties. The registration requirement is therefore in the pipeline and can be expected during 2020. The consultation closed on 21 February 2020.
HMRC’s current proposal (which may be subject to change) is that trustees of existing trusts which are unregistered for genuine reasons will have until 10 March 2022 to register. New trusts will have a matter of days to comply. HMRC’s response to the consultation is anticipated very soon in spring.
In the meantime the response of the ATT to the Government consultation on the Fifth Money Laundering Directive and Trust Registration Service may be found at:
https://www.att.org.uk/technical/news/press-release-bigger-burdens-ahead-many-trustees
