ICAEW has responded to the government’s review of the trust registration service (TRS).  The government has suggested a number of changes to the TRS as part of the wider consultation on improving the effectiveness of the money laundering regulations. The purpose of the changes is to focus registration requirements on the highest risk trusts. 

For a small trust which is not exempt, the registration requirements can be onerous and disproportionate. Therefore, ICAEW welcomes the proposal to create a de minimis level for registration. However, ICAEW has made a number of suggestions for improving the proposed de minimis criteria. These include: 

• raising the proposed £5,000 de minimis level for assets;
• considering whether the £2,000 distribution threshold should apply to distributions made when the trust comes to an end; and
• requiring that the de minimis thresholds are reviewed periodically (eg, 5 April) rather than on an ongoing basis. 

The government has proposed new requirements for non-UK express trusts which have no UK trustees and which own land in the UK. Such trusts will have to register with the TRS and will be brought within the process for sharing trust information. ICAEW has suggested that the test for registration applies only to those trusts that continue to hold the land on the date that the measure takes effect. ICAEW has repeated comments made in response to an earlier consultation that one consolidated system should be established for trusts owning UK land. 

ICAEW supports the proposals to align registration deadlines for trusts required to register following a death. Some trusts are excluded from registering for a period of two years from the date of death. Extending this to other trusts would reduce unnecessary short-term registrations. However, ICAEW recommends that awareness of the current two-year exemption needs to be raised more generally. This is particularly important in light of current delays at the probate registry, which mean that estate administration now often exceeds two years.  

For further guidance on the TRS, see TAXguide 14/20.