Trust Bloomberg Tax for the international news and analysis to navigate the complex tax treaty networks and global business regulations.
By Ben Stupples
The U.K. tax authority has missed the deadline to launch its online register for the beneficial ownership of trusts as the government grapples with the legislative fallout of this month’s snap general election.
Her Majesty’s Revenue and Customs was expected to launch June 26 an online beneficial ownership register for trusts, giving it unprecedented power to find misuse of them. The register will now be available later “in the summer,” an HMRC spokeswoman told Bloomberg BNA in a June 26 email.
The delay comes amid the government’s struggle to implement legislation planned before U.K. Prime Minister Theresa May decided two months ago to call a snap general election on June 8.
HMRC’s online trust register, which aims to boost tax transparency, forms part of compliance with the European Union’s latest directive revision against money laundering, tax avoidance and evasion. Member states had until June 26 to implement the revisions into domestic law, but May’s call for an election prevented lawmakers from passing the final regulations before parliament dissolved last month.
“Due to the General Election, the laying of the Regs before Parliament has been delayed,” the HMRC spokeswoman told Bloomberg BNA in a June 22 email about the final regulations. The tax authority and the Treasury have been “further considering” responses to the published draft laws, she added.
The online register’s delay also comes despite the government meeting the deadline to implement the EU’s revisions into U.K. law. In addition, HMRC has already scrapped the previous paper-based trust register, meaning that the tax authority currently has no way of collecting data on new trusts.
Emily Deane, technical counsel at the U.K.’s Society of Trust and Estate Practitioners, told Bloomberg BNA in a June 27 email that HMRC is asking customers to “postpone” notifications on a new trust or complex estate due to the delay. Customers can notify again “when the new service is operational.”
Customers can expect “further guidance” from HMRC on “key issues” for the register, she added.
As part of HMRC’s online register, the individual controlling any existing trust—an entity created to hold assets for the benefit of certain people or other entities—must provide information about the people involved before the April 5, 2018, filing deadline. The registration requirement applies to any trust with a U.K. tax liability, regardless of whether they are located onshore or offshore.
Through the register, the person controlling a trust will disclose the social security numbers of U.K. residents, and the passport numbers of non-U.K. residents, involved in the trust.
Known as a trustee, the controller also must disclose a statement of accounts describing the trust’s assets and the country where it is administered for tax purposes, according to the final regulations.
Collecting this sort of information will allow HMRC and U.K. law enforcement agencies to “draw links between all parties related to an asset in a trust,” the tax authority said in a consultation originally published in September 2016. In turn, that allows a “marked change” in their ability to identify and interrupt suspicious activities.
“It’s quite a big deal,” Priya Dutta, a senior tax manager at London-based tax adviser Mark Davies & Associates Ltd., told Bloomberg BNA by telephone June 20. “There’s a lot of information that HMRC are going to get, and you can imagine that they’re going to look into things very carefully.
To contact the reporter on this story: Ben Stupples in London at firstname.lastname@example.org
To contact the editor responsible for this story: Penny Sukhraj at email@example.com
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)