HMRC updates TRS manual in advance of 1 September deadline

HMRC has made several important updates to its trust registration service manual including adding new sections on penalties, data requests and discrepancy reporting. ICAEW’s Tax Faculty highlights the key changes.

The deadline for registering non-taxable trusts that became registerable on or after 6 October 2020 is 1 September 2022 – or 90 days if longer. This is now less than a month away. 

previous news item highlighted the support available to ICAEW members. Registrations must be made on HMRC’s trust registration service (TRS). The process for digitally excluded trustees is still in development. 

The new sections cover:

In recognition of the fact that the registration requirement is a new and unfamiliar obligation for many trustees, there will be no penalty for a first offence of failure to register or late registration of a trust. The exception is when that failure is shown to be due to deliberate behaviour on the part of the trustees. In that case, or where there are repeated failures, a £5,000 penalty may be charged per offence.

In practice, this means that, should HMRC become aware of a trust which has not been registered by the relevant deadline – either because that trust has been registered late or because HMRC has identified that trust’s existence by other means – HMRC may issue a warning letter to the trustee or agent. It would usually only charge a penalty if that letter were not acted on.

Similar penalty rules apply to the requirement to update the information held on the TRS.

The manuals include the answers to some frequently asked questions:

  • TRSM32020 confirms the position for non-taxable trusts with a dormant unique taxpayer reference (UTR) who should answer ‘no’ when asked if they have a UTR.
  • TRSM23150 confirms the position where the trust is established in a European Economic Area (EEA) member state and is required to be registered on the equivalent beneficial ownership register of that member state.
  • TRSM23110 covers the position on trusts for holding client money and for holding tenant contributions for the purposes of s42, Landlord and Tenant Act 1987.
  • TRSM10030 has a useful list of common types of trust and how they interact with the register.
  • TRSM23160 explains the exemption for bank accounts held for minors and the limits to that exemption.


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