How do I register a Trust with the Trust Registration Service (TRS)?

How do I register a Trust with the Trust Registration Service (TRS)?

Ian Winterbotham tells us all about registering a Trust with the Trust Registration Service.

What is the Trust Registration Service for those that aren’t aware?

It’s a service provided by HMRC to provide a clear record of the legal owners and the beneficial owners of UK Trust assets. The requirement to register Trusts has been brought in to strengthen compliance with anti-money laundering regulations. It came in a few years ago.

When did the requirements to register Trusts begin?

Your Trust should have been registered by 1 September 2022 to comply with the new regulations, which are law, to ensure no penalties arise. All new Lifetime Trusts should be registered within three months of creation. It’s a requirement to register Will Trusts within two years of the date of death.

However HMRC have not informed anybody about these regulations and many Trustees are completely unaware of them. It’s said that as long as you make every effort to register your Trust as soon as you learn about it, they may let you off any fine for the time being.

What Trusts need to be registered with the Trust Registration Service or TRS if we abbreviate it?

Taxable Trusts have always been required to be registered, but now non-taxable Trusts must also be registered, and it’s a legal requirement.

The term they use for Trusts that need to be registered are Express Trusts, which probably doesn’t mean anything to anyone and makes you think of trains, cars or parcel delivery services. An Express Trust really just means that it’s written down or it’s expressed somewhere intentionally – so the Trust hasn’t been created by accident.

What Trusts are exempt from TRS, the Trust Registration Service?

The starting point would be to assume that any Trust you have should be registered. There are some Trusts which are created unintentionally, and some Trusts are intentionally created by the courts when people get divorced, or when people lack capacity.

You should consider all other Trusts to be Express Trusts. There is a very common situation, where people own property jointly as tenants in common and actually, a Trust has been created when the tenancy in common was set up.

That doesn’t have to be registered on its own, but any Trust that’s created involving Tenants in Common still has to be registered.

How do I know if my Trust needs to be registered?

All Lifetime Trusts and Will Trusts that are written down, and certain other Trusts which have been expressed and are intentional, must all be registered.

Who is responsible for registering the Trust?

The Trustees are all responsible for registering the Trust, but they appoint a Lead Trustee who must actually do the registering. The settlor of the Trust – the person or people who’ve created it in the first place – would normally nominate the lead Trustee.

The lead Trustee is responsible for entering the details, but all the Trustees are equally responsible for keeping it up to date and paying any taxes due.

Are there any penalties if my Trust is not registered in time?

At the moment [podcast recorded in December 2024], I’m told HMRC applies penalties ranging from £100 to £300 for failures to comply with registrations, and even just updates.

But that has only applied just to taxable Trusts in the past because non-taxable Trusts have not needed to be registered until now. It’s not clear at what stage penalties will apply to non-taxable Trusts, but I think we must assume they will come in one day.

What is a Lead Trustee?

The settlor may want to report everything themselves, or they may choose a Trustee to do it for them. If the settlor doesn’t have capacity, the other Trustees have to decide who’s going to actually put the information into the system or be responsible for doing so.

As I said, all Trustees remain equally responsible for the Trust and are equally liable for the actions and the taxes. But the Lead Trustee is responsible for the initial registration of the Trust with HMRC and notifying HMRC of any changes to the assets, to the Trustees or to the beneficiaries of the Trust.

This includes updating the Trust record for any grandchildren, et cetera, born after the Trust has been registered. It’s important that regular Trust reviews are carried out.

How do I register a Trust? What is the process?

You can do it yourself, and I wouldn’t discourage anyone from doing it, because it means that you can feel in control of the whole process and update it without having to involve other people in the future.

All you need to do is type into a search engine: ‘Register a Trust as a Trustee’, and then follow the links. But you may end up feeling you’ve gone down a rabbit hole and you really don’t know how to answer the questions thereafter.

We’ve mentioned terms like Express Trusts and taxable Trusts. It also asks you whether you want to register the Trust as an individual or as an organisation. If you then don’t put enough details about the Trustees, the beneficiaries, etc as required under the rules, you might worry that HMRC will come back in the future and hold you responsible.

I would say maybe 10% of our clients have gone on and done it, and maybe only half of those have done it correctly, in terms of giving all the details that are required.

I think it is a good idea to do it yourself if you feel capable. Treat it as a proper project and find out more about what every question means. Then, you can be a great help to everyone. Otherwise, you can instruct an expert to do it for you.

Is there anything else we need to know about registering a Trust?

It’s quite challenging for people who are Trustees these days – We look forward to helping them if they need help.