23 juin 2022
In most cases, under the current rules, there will not be unrestricted public access to information on a trust held on the UK trust registration service (TRS) maintained by the UK Revenue (HMRC).
This is in contrast to the position for information on the UK register of beneficial owners of companies (the PSC register) and the register of beneficial owners of overseas entities that hold UK land, which is due to come into force later this year (the register of overseas entities), which is accessible by anyone.
Information on the TRS about a trust which you set up, or of which you are a beneficiary, will always be available to HMRC and other law enforcement authorities in the UK, but whether that information is accessible by others will depend on a number of factors, in particular, if the trustees are UK resident or non-UK resident.
Generally, information held on the TRS will only be accessible to a person who can demonstrate that they have a 'legitimate interest' in the information. This requires the person to show that access to the information furthers work to counter money laundering or terrorist financing activity. Anyone requesting access will have to provide information to support their suspicion that the trust has been used for money laundering or terrorist financing.
HMRC has indicated that any person requesting information will have to provide the name or identity of the specific trust, to prevent 'fishing' for information, and it is likely that any person requesting data will be required to provide identification documents and evidence that links the trust or person about whom the request is being made to money laundering or terrorist financing. Legitimate interest requests can be made from 1 September 2022 onwards.
The exception to this is if the trust has a controlling interest in a non-EEA entity (eg a BVI or Jersey company). In those circumstances, the accessible information on the TRS must be provided to any person who makes a written request; there is no "legitimate interest" hurdle to overcome (although a person seeking information will still need to make a particularised request with a supporting rationale).
The EEA includes all member states of the EU and Iceland, Norway and Lichtenstein. A trust will have a controlling interest if the trustees (i) hold, directly or indirectly, more than 50% of the shares or voting rights in the company, (ii) have the right, directly or indirectly, to appoint or remove a majority of the board of directors, or (iii) have the right to, or actually, exercise significant influence or control over the entity.
Trusts with a mixture of UK resident and non-UK resident trustees must register on the TRS if the trustees:
Access to the information on the TRS about such a trust is restricted in the same way as for a trust with all UK trustees - generally, it will only be accessible to a person who can demonstrate that they have a 'legitimate interest' unless the trust has a controlling interest in a non-EEA entity in which case the information will be freely accessible.
Trusts with all non-UK trustees must register on the TRS if the trustees have a liability to UK tax on UK source income or UK assets, or acquire an interest in UK land. The information on the TRS concerning trusts that fall within this category is, as with all trusts that have to register on the TRS, available to HMRC and other law enforcement authorities in the UK, but is not accessible by others. However, the policy reason for restricting accessibility in these circumstances is unclear, and, if there has been a drafting error in that regard, then it remains to be seen whether any correction is made retrospectively.
If information on the trust register is accessible, then the name, month and year of birth, residence and nationality of the settlor, beneficiaries and trustees and the nature of each of their interest in the trust (eg that they are a discretionary beneficiary or are entitled to 25% of the income of the trust) will be made available to the person requesting it. The address of an individual settlor, beneficiary or trustee and information on the assets of the trust or their value will not be available to the public under any circumstances. Information on an individual who is under the age of 18 or lacks mental capacity may be exempt from being supplied.
Despite global progress on the introduction of registers of beneficial ownership of companies and trusts, there are continued calls for ever greater transparency and further changes to the rules are likely. The Economic Crime Manifesto published recently by the All-Party Parliamentary Group on Anti-Corruption & Responsible Tax calls for the TRS to be much more transparent and for an open register for the beneficial owners of UK land, and urges reform of the Economic Crime (Transparency and Enforcement) Act 2022 to enable law enforcement, journalists and others to be able to identify who really owns companies, trust and assets.
If you are unsure of your or your clients' obligations concerning the TRS, please get in touch with our team. The deadline of 1 September 2022 for the registration of trusts caught by the rules before 4 June 2022 is fast approaching; where the obligation to register on the TRS arose after 3 June 2022 the trustees have just 90 days to register the trust.
This article is not intended to constitute legal advice.
par Alexander Erskine et Josh Eaton
par plusieurs auteurs