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Trust registration service exclusions

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HMRC has clarified the scope of exclusions for certain insurance policies with a surrender value from the Trust registration service (TRS). The TRS will be expanded later in the summer to accept registrations of certain non-taxable trusts. The basic rule is that all UK express trusts (taxable and non-taxable) should be on the register, but Schedule 3A to the Money Laundering and Terrorist Financing (Amendment) (EU Exit) Regulations, SI 2020/991 sets out a number of exclusions.

HMRC has confirmed its interpretation of the following exclusions in Sch 3A:

  • paragraph 4 (trusts of certain life insurance policies) – to make it clear that this includes trusts holding policies which have surrender values, such that they would remain excluded until such time as the policy is surrendered;
  • paragraph 8 (trusts holding the proceeds of a policy under para 4 during the two years after the death of life assured) – to make it clear that pay-outs received from such policies on death would continue to benefit from the exclusion.

HMRC intends to confirm this position in the next version of its Trust Registration Service Manual.

Issue: 1540
Categories: News