How to register a trust as an agent

The HMRC has issued a reminder to everyone required to register a trust to do so as soon as possible. 

You must register a trust with HMRC:

• if the trustees need to get a Unique Taxpayer Reference (UTR) – for example, for filling in a Self Assessment tax return for the trust
• to make sure the trust complies with anti-money laundering regulations

You must also register if the trust becomes or is liable for any of the following taxes:

• Capital Gains Tax
• Income Tax
• Inheritance Tax
• Stamp Duty Land Tax
• Stamp Duty Reserve Tax
• Land and Buildings Transaction Tax (in Scotland)
• Land Transaction Tax (In Wales)

The HMRC also explained that if the trust is not resident in the UK (‘non-UK resident trusts’), you must register the trust if it becomes liable for tax on income coming from the UK or on UK assets.

Moreover, if the trust has a tax liability but this is covered by a relief, you’ll need to register the trust if your client needs to claim the relief through Self Assessment.

When to register

As for when to register, the HMRC explained that the registration deadline depends on:

• the tax the trust is liable for
• whether it has been liable for income tax or capital gains tax before

For example, if trusts that are liable for income tax or capital gains tax for the first time, they must be registered by 5 October in the tax year after the one in which the trust starts to receive any income, or has capital gains, and becomes liable for income tax or capital gains tax. 

For example, if the trust received some interest for the first time in May 2019 (the 2019 to 2020 tax year) and became liable to income tax on it, you will need to register the trust by 5 October 2020 (in the 2020 to 2021 tax year).

For trusts that have been liable for income tax or capital gains tax before, they must be registered by 31 January in the tax year after the one in which the trust receives any income, or has capital gains, and is liable for tax.

On the other hand, those that are liable for other taxes must be registered by 31 January in the tax year after the one in which the trust has any other tax liability, such as Inheritance Tax.

If the trust is liable for more than one tax and both deadlines could apply, you must register it by the earlier of the 2 deadlines.

For more information click here.