The Trust Registration Service (TRS) deadline will be extended in the wake of the coronavirus pandemic, it has been revealed.
The deadline to register existing trusts was March 2022, but HM Revenue & Customs (HMRC) has confirmed that the new system will not be ready in time.
Under existing rules, trustees must register a trust under the TRS if it is liable to pay income tax, capital gains tax (CGT), inheritance tax (IHT), Stamp Duty Land Tax (SDLT) or Stamp Duty Reserve Tax.
But new rules – required after the introduction of the EU Fifth Anti-Money Laundering Directive (5AMLD) – were introduced on 06 October 2020, extended the scope of the TRS to include almost all UK trusts and certain non-UK trusts that acquire land or property in the UK, whether or not the trust has to pay tax.
The new legislation also requires trustees to disclose the “beneficial owners” of the trust to anti-money laundering authorities.
Only UK-regulated charitable trusts, certain Will Trusts, and non-UK trusts already registered in an EU Member State will be exempt under the new regulations.
It means that potentially millions of trusts need to be registered, but March 2022 comes too soon for the tax authority.
In a notice to trustees, HMRC said it will not meet the March 2022 target for upgrading the TRS to allow non-taxable trusts to register.
The target will now be pushed back until twelve months after the date of “actual delivery” of the expanded register.
You can learn more about the expanded Trust Registration Service here.
What is a Will Trust and why do I need one?
A Will Trust is commonly used to safeguard assets and ensure they are used in the way you want them to be used.
For example, a Will Trust can help to ring-fence property so that it is not used to pay for your surviving spouse’s care home fees
A Will Trust can also be used to protect assets for those who are too young to handle their own financial affairs, or to ensure they are used to pay for things such as college and university.
In some scenarios, you may also want to withhold assets from your heir’s family. A Will Trust can be drawn up stating that your heir can enjoy your assets while he or she is alive, but they are then passed directly to your grandchildren.
For help and advice with related matters, please get in touch with our expert Will and Trust Planning Team today.
Mander Hadley Solicitors is not only a long established firm, but is vibrant and successful, with a forward thinking approach.
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