Inheritance tax facts

HMRC introduced new trust registration rules that came into force in October 2020. Previously, only taxable trusts had to be registered. However, the new legislation has been much more wide ranging, meaning that a trust must be registered, unless it is exempt. The definition of a trust is broad, meaning that “bare trusts” also need to be registered. Bare trusts reflect a situation where someone is registered as the owner of an asset, but they own it on behalf of someone else. This has far reaching consequences, meaning that partnership trusts may need to be registered. Although the deadline for registering trusts was 1 September 2022, HMRC has continued to issue guidance as professionals and individuals try to establish which trusts need to be registered and which are exempt. Fortunately, recognising that trustees will find the requirements unfamiliar, HMRC has stated that it will not penalise those who fail to register for the first time - unless the trustees deliberately avoided doing so.

Understanding how Wills, Trusts and Estates work can help you protect your assets and keep your loved ones financially stable. Read our blog to learn more.

The Home Office has made several important changes to the Sponsor Guidance in its new 01/25 versions, heralded by a ministerial statement in December.