Healthcare trustees are being urged to register their arrangements as figures show trust registrations have soared this year with more than double last year’s total being registered in the last two months alone.
Trustees have until 1 September to register with HM Revenue & Custom’s new trustee registration service (TRS) or risk being held personally liable.
A Freedom of Information request by Canada Life to HMRC found that 211,381 trust registrations of all kinds have been received since the TRS began in June 2017, with almost a third of these made in the first half of 2022.
Only 150,000 had been made by the end of 2021 with more than 61,000 registrations coming in just the last six months – the 36,360 received in May and June alone was almost double the figure received in 2021.
Consultancy Halcyon Trustees pointed out that the new rules are aimed at ensuring the UK has an anti-money laundering and counter-terrorist financing regime that is up to date, effective and proportionate, and offers improved transparency about the ownership of assets held in trusts.
According to the firm, TRS requires the nomination of one lead trustee to be the main point of contact for HMRC.
The information required includes:
• Trust name.
• Trustee details including NI numbers.
• Trust creation date.
• Beneficiaries’ information or classes of beneficiaries.
• Approximate number of beneficiaries in the group.
The firm further warned that trustees who fail to register by the deadline could be in breach of the law and subject to incremental penalties.
Depending on the provisions of their deed, trustees could be personally liable, needing to repair any reputational damage that arises.
‘Long way to go’
Canada Life said it was imperative that advisers and providers raise awareness among trustees about the deadline.
Stacey Love, tax and estate planning specialist at Canada Life, said: “It’s great to see that the message to register is starting to get through to trustees, however the clock is ticking and we still have a long way to go to ensure all the trusts that are required to register do so by the deadline.
“Using a trust has been such a fundamental part of the tax and estate planning landscape for so long it’s entirely possible the existence of a trust may have faded into the background.
“As a result, many ordinary people who are trustees may not realise that TRS registration still applies, unless they pay close attention to the financial press or receive regulatory updates from HMRC.
“With no central HMRC communication it’s imperative that providers and advisers work together to flag up these new rules with all of their trustee clients affected by the regulations.
“With around one million trusts needing to be registered there is still a significant amount of work to complete and the onus is on advisers and providers to highlight the process to trustees.”