£5,000 penalty for failure to register trusts

The Low Incomes Tax Reforms Group (LITRG) is urging trustees to register with HMRC by 1 September to avoid risking a £5,000 penalty.

Initially, only trusts which owed tax were required to register with the Trust Registration Service (TRS), but the scope of the TRS has expanded to include all trusts, whether taxable or not.

Non-taxable trusts must now be registered by 1 September or within 90 days of being set up, whichever is later.

LITRG is concerned people could be caught out, especially as a trust can exist without those involved realising it.

There will also be fines of up to £5,000 for non-compliance if HMRC deems someone to have deliberately failed to sign up.

Antonia Stokes, technical officer at LITRG, said:

"We are concerned that the broad scope of the TRS means some people may not realise they are party to a trust which needs to be registered.

"For example, although junior ISAs and cash accounts held by minors are not in scope, a relative directly holding stocks and shares for a minor is required to register that arrangement.

"Those in doubt about whether they must review their arrangements without delay. If necessary, the trust should be registered before the deadline to avoid the risk of a penalty."

Ask us about your trusts.

 

Other news articles you might like:

People-focused expertise just a click away

Ready to level up your business?

With our support, we know we can help you reach new heights.