Registration of Will Trusts | Don't Get Caught Out!

Have you created a lifetime trust? Does a Will of a deceased family member contain a trust? Do you co-own property under a trust arrangement? If so, you may need to take action now.

Most new trusts created on or after 1 September 2022 must now be registered with HMRC, even when they are not taxable, as an extension to anti-money laundering regulations. This is a legal requirement. 

All taxable trusts need to be registered and whilst there are a few excluded non-taxable  trusts, where a non-excluded trust is effected by a Will, it must be registered within two years from the date of death of the testator.

Where someone varies a Will by a Deed of Variation the time period for registration is 90 days from the date of variation.

If a testator grants a life interest or a right of occupation to a beneficiary in their Will, this creates a trust which must be registered within 2 years.  There is a further requirement to register a separate property trust within 90 days of the date of death of a testator where the Trustees and beneficiaries are different people.  

Often where probate isn’t required, for example where all bank accounts and investments pass to a surviving spouse or partner, it can be easy to forget to check whether a Will incorporates a trust.  It is important to check Wills as a failure to register a trust may result in penalties being issued by HMRC.

If you do discover a Will trust and you are not sure if it needs to be registered please contact us and we will be happy to arrange a meeting to discuss the potential trust administration requirements. Call us on 01926 354704 or email:pcnewenquiries@moore-tibbits.co.uk

Article by: Claire Houghton | Senior Solicitor