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 need to take action now.

Most new trusts created on or after 1st 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 created under 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 also 2 years 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.  

For any property interests where the legal and beneficial owners are different, the Trust arrangement must be registered within 90 days. 

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 491181 or email:pcnewenquiries@moore-tibbits.co.uk

Article by: Claire Houghton | Senior Solicitor