With less than a month until the deadline for registering non-taxable trusts, 6th of October, HMRC have made several important updates to the Trust Registration Service (TRS) manual.
The changes include include sections being added to the manual such as penalties (TRSM80000), data requests (TRSM60000), and discrepancy reporting (TRSM70000).
However, ads the registration is new and complex for many trustees, it has been confirmed there will be no penalty for failing to register a trust, if it is a first offence. Unless the offence is deemed deliberate, in which case a £5,000 penalty may be issued.
If an offence was accidental then HMRC will issue a warning via the post, and if this is not acted on then a penalty may be issued.
The registration process for digitally excluded trustees due to insufficient computing equipment, is still in development.
The updates also include answers to some frequently asked questions, such as:
- TRSM32020 confirms that non-taxable trusts with a dormant unique taxpayer reference should answer “no” when asked if they have a UTR.
- TRSM23150 states that where a trust is established in a European Economic Area state it is required to be registered on the equivalent beneficial ownership register of that member state.
- TRSM23110 gives clarifications for trusts that are holding client money and/or holding tenant contributions for the purposes of s42, Landlord and Tenant Act 1987.
- TRSM10030 provides a list of common types of trust and how they interact with the register, in order to give useful examples.
- TRSM23160 clarifies the exemptions for bank accounts held for minors, and the limits to these exemptions.
However, many questions remain over the manual, such as, the two-year exemption window for estates, clarity over premium bonds for minors and whether trusts need to be registered if they only exist for short period of time.
The Trust Registration Manual can be viewed here.
