Trusts

As a Trustee or connected party to a Trust client of Montgomery Associates you have received a personal invite to this webpage.

This page contains information relating to Trusts and what action you may need to take. Occasionally articles are written by Montgomery Associates or associated third parties, such as firms of accountants or solicitors.

Please contact us if you have any questions: admin@montgomeryassociates.co.uk

Trust Registration Service (TRS)
Article by Wansbroughs Solicitors [website]
wealth@wansbroughs.com
May 2022

Trust us, you want to read this

 

HMRC have recently changed their rules regarding the registration of trusts. Previously, if a trust had no tax liability, it did not need to be registered with the Trust Registration Service (TRS).


The rules on this point have now changed and even trusts which do not have a tax liability and/or existed for only a very short period of time must be registered. Only a select few trusts do not require registration, as per the list of exemptions provided by HMRC.

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What is the Trust Registration Service (TRS)?


TRS is an online service that provides a single route for trustees to comply with trust registration obligations. It was originally introduced for taxable trusts in June 2017 under the 4th Anti-Money Laundering Directive.


On 6 October 2020, the 5th Anti-Money Laundering Directive (5AMLD) was adopted, and TRS was extended to non-taxable, express trusts.

What does this mean for me?


All UK express trusts, which aren’t specifically excluded, will need to register on TRS.


Please find a list of exclusions at the end of this article.


An express trust is one that was created by a settlor intentionally, as opposed to the trust being created through a court decision or through the operation of law. 

When must you register a Trust? 


The deadline for registration on TRS is 1 September 2022. 


All trusts which are caught by this new registration requirement that were in existence on 6 October 2020 will need to register (even if they have since closed). 


From 2 June 2022, all non-taxable trusts caught by 5AMLD will have 90 days to register on TRS.

 

What happens after registration?


Once registration is submitted on TRS, the lead trustee will receive a Unique Reference Number (URN) within 2 – 3 weeks. The lead trustee should send a copy of the URN to Wansbroughs for record keeping.


Should there be any changes made to the any of the trust details provided on registration, or should the trust come to an end, TRS will need to be updated. To do this, the lead trustee will need to create a Government Gateway account on TRS, and claim the trust by answering security questions. Wansbroughs can assist in how to take these steps. 


Fortunately, HMRC have not extended the obligation to make annual declarations about the trust on TRS in the way taxable trusts are required to do so. 

How to apply for Trust Registration?


We appreciate that knowledge on trusts is not everyone’s forte, so if you aren’t sure if your trust needs to be registered, please get in touch. 


In order to comply with the new rules from HMRC, the Private Client team at Wansbroughs can help register the trust on your behalf as an authorised agent.


The cost of attending to this is approximately £150 plus VAT and this is properly payable from trust assets.

Trusts excluded from registration, as per HMRC

 

  • the trust is used to hold money or assets of a UK registered pension scheme — like an occupational pension scheme

  • the trust is used to hold life or retirement policies providing that the policy only pays out on death, terminal or critical illness or permanent disablement, or to meet the healthcare costs of the person assured

  • the trust is holding insurance policy benefits received after the death of the person assured — as long as the benefits are paid out from the trust within 2 years of the death

  • it’s a charitable trust that is registered as a charity in the UK or which is not required to register as a charity

  • it’s a ‘pilot’ trust set up before 6 October 2020 and holds no more than £100 — pilot trusts set up after 6 October 2020 will need to register

  • it’s a co-ownership trust set up to hold shares of property or other assets which are jointly owned by 2 or more people for themselves as ‘tenants in common’

  • it’s a will trust created by a person’s will and comes into effect on their death providing they only hold the estate assets for up to 2 years after the person’s death

  • it’s a trust for bereaved children under 18, or adults aged 18 to 25, set up under the will (or intestacy) of a deceased parent or the Criminal Injuries Compensation Scheme

  • it’s a ‘financial’ or ‘commercial’ trust created in the course of professional services or business transactions for holding client money or other assets

Wansbroughs is one of the leading law firms in the South West, providing bespoke legal advice to Montgomery Associates’ clients for more than 20 years.


Wansbroughs’ lawyers cover a wide range of disciplines, but all share a common dedication to clarity, quality and exceptional service.


If you require any advice relating to TRS, or support relating to tax and trusts please contact: wealth@wansbroughs.com
 

Legal Entity Identifier (LEI)
Article dated 2017

In Summary

Since 3rd January 2018 investors who are deemed to be Legal Entities must have had a Legal Entity Identifier (LEI) in order to trade on financial markets or to receive investment services. This definition includes Trusts as a Legal Entity and it is the Trustees responsibility to apply for and then renew the LEI each year for the lifetime of the Trust.

How do I renew the LEI?

Each year the Trustee maintaining the LEI will receive an email stating that it is due for renewal. The fee (£70 + VAT) covers the costs incurred by the London Stock Exchange in maintaining their central database of Identifiers. The process of renewal is quite simple and should take around 15 minutes each year. Click on the link below for a detailed set of step-by-step instructions outlining the process from beginning to end.

What is an LEI?

An LEI is a 20-character alphanumeric reference code which uniquely identifies companies or entities (in this case Trusts) involved in financial transactions.  This is a global initiative to enable regulatory authorities across the world to monitor trading activity to help identify market abuse in the industry.

How do I get the LEI?

The Trustees need to choose (if they have not already) a ‘Primary Trustee’ who is responsible for obtaining the LEI. The process for requesting the LEI looks daunting but is in fact very straightforward. The UK regulatory body authorised to distribute LEIs is the London Stock Exchange (LSE). See www.lseg.com/LEI for more details.

How much does it cost?

The LSE charge an initial fee of £115 + VAT (£138) to register the LEI and then an annual renewal fee of £70 + VAT (£84) for subsequent years. The Trust itself will need to bear these costs. KMA can of course raise the required cash as usual from the Trust investment account upon request.

Trustee: stages of registration

1)  Register on UnaVista

2)  Request an LEI - Click here for instructions

3)  Supply your LEI number to Montgomery Associates

The LEI needs to be renewed annually. Each year the LSE will send a ‘LEI Annual renewal date approaching’ reminder to the email address used to register. This will provide simple instructions on how to renew. For more detailed instructions click here.

All LEI information is available on a public database. This is the information you entered when requesting an LEI such as the Trust’s name and address, but no financial details are held.

What else do you need to know?

Can Montgomery Associates help?

Yes. Click here for out step-by-step instructions for registering and obtaining an LEI for a Trust and, as always, if you need any assistance or further guidance, please do not hesitate to Contact Us.