Earlier in the year, HMRC expanded the requirements of the trust registration service (TRS) so that many more trusts will now have to register. With a registration deadline of by 1st September 2022, if no action has been taken on this, then you need to consider your position now.
For those less familiar with the TRS, it was introduced in 2017 as part of the UK’s implementation of the fourth EU Directive, which dealt with money laundering. Each time a new Directive is issued, HMRC reviews and updates the TRS requirements to keep it fit for purpose. The latest changes are a result of the fifth Directive.
Although employee benefit arrangements are not the main focus of the Directives, if they are based on a trust arrangement they are still subject to the TRS requirements. Some trusts are exempt from registration, and it was initially hoped that healthcare trusts would fall into this category – but our understanding is that an exemption has not been provided to date.
As it is the responsibility of trustees to register a trust, it is important that any company with a medical trust arrangement in place, should therefore either:
- Seek legal advice as to whether or not their particular trust should be registered; or
- Register it with the TRS if they do not wish to obtain legal advice beforehand
The choice is theirs.
NB: For anyone participating in a Healthcare Master Trust, the provider acts as the trustee, and the responsibility sits with them.
More information can be found at: https://www.gov.uk/guidance/register-a-trust-as-a-trustee, including what trustees need in order to register their trust, and how this is done.
What happens if you don’t register?
The GOV.UK website currently provides the following statement regarding non-registration:
“If you do not register the trust on time, you may receive a notification letter reminding you of your obligation to keep the register up to date. If you do not keep the register up to date you may be charged a penalty.”
No guidance is provided as to what any penalties might look like. However, for what should be a relatively straightforward process, there is no need to put yourself at risk of having a penalty imposed.
With the registration deadline fast approaching, it is vitally important that any employer with a healthcare trust takes action now.