New Government Portal adds to responsibilities of Trustees
On the 26th June 2017 the Government introduced new requirements to be imposed on trustees of trusts requiring them to keep a register of certain information. William Ware, Trusts Partner, here explains why these requirements have been introduced and what Trustees now must do in line with the new directive.
Online portal for trustees
The change is part of more European initiatives designed to crack down on money laundering and abuse of trusts. A new portal has been introduced and where a trust benefits from income, incurs capital gains or is liable for inheritance tax, trustees are now obliged to register a number of details on the new online Trusts Register Portal.
“Very little publicity has been evident following the introduction of this quite heavy obligation and it will particularly affect trustees of small family trusts,” commented William. “Trustees are now required to log on to the new Government Portal, which itself is not a straightforward process, and then there is a quite burdensome obligation to record numerous details.”
The details required for the portal are as follows:
- A contact address for the Trustees,
- The full name of any advisors providing financial or legal advice to the Trustees in relation to the Trust on an ongoing basis,
- Details of beneficial owners and Trustees - in particular the full name, national insurance number/unique tax payer reference number and address,
- Dates of birth.
If beneficiaries are young and do not have passport numbers then some other form of identification should be provided.
William continues, “A Trustee should not underestimate the time it can take in tracking down the relevant details before they can upload this onto the Portal, and a deadline has been fixed for completing this in relation to all existing Trusts by the 31st January 2018, and there is an ongoing liability to keep the information updated.”
Trusts and portal requirements
The requirement and registration on the Portal is restricted to those trusts which have some kind of tax consequence e.g. capital gains or income or inheritance tax; if the trust is in effect a passive trust – perhaps comprising a matrimonial home or other property where there is no income then, although there remains a duty to collate all the information listed, trustees are spared the pain of actually having to log this all onto the new Portal.
William concludes, “The new provisions under the Fourth Money Laundering Directive are obviously understandable given the common desire to crack down on terrorist financing and similar criminal activities; nevertheless a number of perfectly innocent small family trusts are now going to be potentially in breach of the obligations, of which they may not have previously been aware, with questionable benefit in the overall view of things.”
This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.