The functionality of the Trust Registration Service (TRS) now allows for both registering and updating details of trusts and complex estates. The requirement to register is to be extended to more trusts to comply with the EU’s Fifth Money Laundering Directive. ICAEW’s Tax Faculty provides guidance on how to register trusts and estates on the TRS and how to update that information.
Registering a trust or estate
The full functionality of the new trust registration service (TRS) is available, allowing trustees and agents to:
- Register all types of trusts and estates
- Make changes to all types of trusts and estates
- Declare “no change” in respect of all types of trust
- Close a trust or estate
The original iform trust registration service ceased to be available on 23 September 2020 when it was replaced by a new service.
HMRC’s guidance for a trustee registering a trust is available on Register a trust as a trustee.
HMRC’s guidance for an agent registering a client’s trust is available on Register a trust as an agent.
HMRC’s guidance for a personal representative registering an estate is available on Returns for someone who has died.
HMRC’s guidance for an agent registering a client’s estate is available on Register your client’s estate.
Agents do not need to be authorised in order to register a trust or estate, but authority does need to be in place to view or change any of the registration details (details below).
Once a trust or estate has been registered the other services are available from Manage your trust's details.
Update the register
The TRS opened for registrations in 2017 but, while trustees and agents could register trusts, they were unable to update the data originally submitted for any changes to details of trustees, settlors and beneficiaries until April 2020 when this functionality was released.
Whether there is an obligation to update trust details on the register depends on whether the trust has incurred a tax liability.
Under the current regulations, if there is a tax liability in the year in which the change occurred, trustees are required to update the data on the register for those changes by 31 January following the tax year in which the change occurred. If there was no UK tax liability in the tax year the change occurred, the requirement to update is deferred until the 31 January following the next tax year in which a tax liability arises. (Note that tax liability is not limited to just income tax or CGT as might be suggested by the link to tax years, but can include SDLT/LBTT/LTT, IHT and Stamp Duty Reserve Tax.)
If there are no changes to trust data in a tax year, but the trust has incurred a tax liability during the period, the trustees must confirm via the TRS that no changes have occurred and that the details on the register are up to date on or before 31 January following the tax year.
Question 20 on self assessment tax returns
Trusts within self assessment must confirm that they have either updated the register or confirmed the details are correct by completing question 20 of the SA900 return.
On 2017/18 and 2018/19 returns trusts were permitted to leave this question blank because the functionality to update the register did not exist. For 2019/20 returns the question must be addressed.
If a trust has incurred a tax liability in 2019/20, the position is straightforward: the trustees must access the TRS to either update the register or confirm that there have been no changes to the information previously submitted and this must be done by 31 January 2021. Those within self assessment must confirm they have done this by answering question 20 appropriately or HMRC may enquire into the return.
If a trust has not incurred a tax liability in 2019/20 but a change has occurred during that year, the trustees must update the register by 31 January following the next tax year in which a tax liability does arise.
For trusts where the details changed in either 2017/18 or 2018/19 the position is more complex.
If the trust did not incur a tax liability in the same year as the change an obligation to report has not yet arisen. If it did incur a tax liability in the year of change the reporting deadline would have been 31 January 2019 or 31 January 2020 depending on the year of liability. However, since it was not possible to report changes at those points, trustees did not have to take any action.
We understand that if an obligation to report changes arose in 2017/18 or 2018/19 with either a 31 January 2019 or 2020 deadline, the trustees should now take steps to update the register by 31 January 2021. This is regardless of the liability position for 2019/20. In other words, if there was a change before 6 April 2020, and a liability for any of the three years 2017/18 to 2019/20, details must be updated by 31 January 2021.
Step by step guide to updating the register
The next issue is how to update the register in practice.
Step 1: A trustee sets up a government gateway user ID
A trustee needs government gateway credentials for each trust they administer to appoint an agent to update the TRS for that particular trust, or to update the register themselves. If they have already got credentials for the trust, they can go straight to step 2.
To set up a government gateway user ID for the trust:
- The trustee should go to Manage your trust's details and click on the green ‘Start now’ button. This takes you to a page headed Sign in using Government Gateway. Click on Create sign in details which is under the green sign in button.
- The trustee will then be asked for details of their own email address and name and to set up a password and recovery word. They will then be issued with a government gateway user ID - all before they tell HMRC what the ID will be used for.
- Once the user ID has been created, the trustee will be asked for the type of account they need. The correct account to select for a trust is Organisation.
For digitally excluded trustees who can’t set up a government gateway user ID, please see below.
Step 2: A trustee needs to claim the trust
In order to ‘claim’ the trust, the trustee should either continue the process above or, if they have had to log out for any reason, go to Manage your trust's details and follow the Start now green button at the bottom of the page and use the credentials created in step 1.
The trustee will need:
- The trust’s UTR
- Details of the trust’s original registration
The trustee will be asked to provide details that HMRC already knows about the trust from the original registration (or the latest update) in order to ‘claim’ it. This could be the name, date of birth and national insurance number of the lead trustee or another person associated with the trust – which could be one of the trustees, beneficiaries or settlors. The trustee can check the details entered and will be told if they have successfully claimed the trust.
If the trustee does not enter the correct details, they will get a message that their answers do not match the details HMRC holds about the trust. Trustees will have three attempts to enter the correct information. If they are unsuccessful after the third attempt they will be locked out and will have to repeat the process after 30 minutes.
We have had reports that problems can arise where, on original registration, details of (say) a beneficiary’s passport number was provided rather than a NINO. We are looking into whether this is causing problems that might prevent a trustee claiming the trust.
Step 3: The agent signs into their Agent Services Account
The agent then needs to sign in to their agent services account (ASA).
Step 4: The agent issues a link to the client
Once logged into their ASA, the agent should select the option to be authorised to maintain a trust. They will need to enter the trust’s UTR and confirm the client details. The system will then generate a link which the agent must copy and email to the client, and a message explaining what to do next. Agents are also able to track their recent authorisation requests.
Step 5: The trustee authorises the agent
The trustee needs to click on the link sent by the agent within seven days (some members have reported that the link stays live for 14 days). This will take them to an appointment message from where they can sign into their government Gateway account using the credentials that they created up in Step 1.
The trustee will then be presented with the option to authorise their agent and to give their consent to HMRC allowing the agent to maintain the trust. The client will be presented with a message that the approval has been completed, and which explains what they can do next.
Step 6: Agent logs in to update the register
Once the trust has accepted the agent’s appointment, the agent can go to Manage your trusts' details and log in with their ASA credentials to access the trust and update it.
Trustees are required to update the register for any changes to details of their beneficial owners. The legislation also says that trustees should update the register for other changes, including changes to advisers, the place where the trust is administered and country of tax residence. We have asked HMRC if it will also be possible to update the register for these aspects and not just beneficial ownership (which is the main focus of the register). It is not necessary to update the register for changes to the statement of assets reported on first registration.
Once the register has been updated, the whole updated register entry can be saved as a PDF, including a declaration to confirm the register has been updated.
Hint and tips for updating the register
The following comments and observations may help trustees and agents to navigate the process.
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The trustee must complete steps 1 and 2 above to set up a government gateway user ID for each trust for which they are responsible and ‘claim’ that trust. This must be done before the agent attempts to request authorisation to maintain the trust from their ASA.
If the trustee attempts to accept the agent’s invitation without first ‘claiming’ the trust they will receive a page not found error message. If the agent attempts to send the link for authorisation and then get the trustee to set up a government gateway user ID by following the route from that link, the process will also fail.
The trustee needs to claim the trust in order to link the trust’s UTR with the government gateway credentials (ie, the user ID and password) that they have created for it.
Enter credentials in the right place
It’s also important to understand that after a set of government gateway credentials has been created, where they take you in HMRC’s systems when you sign in depends on which part of GOV.UK they are entered into.
Clicking various green buttons within HMRC like Start now, Register now, etc, all generally take the user to what looks like a common sign in screen. However, while the sign in screen looks the same, where the user ends up after entering their credentials very much depends on which page they started from on GOV.UK pages.
Self assessment online and the trust register are not linked
Another common assumption is that the trust register is linked to self assessment. It isn’t. Logging into the trust’s business tax account using the trust’s credentials will not give access to the TRS.
Trust credentials are separate from trustees’ personal credentials
Any trustee who already has a personal tax account in their own name needs to understand that the trust’s credentials are something completely separate from their own.
Digitally excluded trustees
Some trustees may not be able to use the online system to appoint the agent. A digitally excluded trustee is one who, for reasons of age, disability, remoteness of location, religion or other valid reason is unable to engage with HMRC’s online digital services.
We understand that HMRC is considering how to enable such trustees to appoint an agent. If none of the trustees are able to appoint the agent digitally, one trustee should call the Trust Helpline (0300 123 1072) for help and support.
The advisers on the helpline will triage the trustee to HMRC’s Extra Support Team (EST) if that is appropriate. The EST can then determine if the trustee falls into the digital assistance group (ie, they could use the service with help) or digitally excluded (they cannot use the service).
Technical IT service problems
Trustees or agents who experience problems with the TRS can either call the trusts helpline (0300 123 1072), or raise a ticket with the HMRC digital team by clicking on the Get help with this page link at the bottom right of the screen.
The user should provide a UTR and detailed information to identify the case and the reason for the problem. Ideally, this should an explanation of what the user was trying to do before they got the error message, what step they had got to, a screen shot showing what was entered and any messages, and the date/time of the incident.
HMRC is looking into some issues which are preventing a small number of trusts which were registered at the start of TRS from being able to update the register.
Where a trust was registered since 2017 but has since closed, the TRS should be updated to confirm that the trust has ended. Our current understanding is that this is necessary even if the trust was wound up some years ago and HMRC notified by some other means.
The trustees may not be aware of their obligations and there will be no trust assets left to pay fees.
HMRC would prefer personal representatives and agents to use the TRS to notify the closure of a registered estate but there is no obligation to do so. Notification can be made by letter or via a self assessment return if that is more convenient.
For registered estates where a closure notification has already been made by letter or in a self assessment return, HMRC does not expect personal representatives or agents to go back and update the TRS as this will be done by HMRC staff.
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