The move means non-UK trusts which just have UK property holdings through a non-UK company will not have to provide the TRS with a list of beneficial owners: a requirement which had caused concern about individuals’ security for many in the trust industry. Previously, HMRC’s view was that non-UK trusts needed to register with TRC if they held shares in non-UK companies which hold UK residential property, because there could be a liability to inheritance tax.
It has now decided this is not the case. The only non-UK trusts which will have to register with TRC are those which receive income from a UK source or hold UK assets on which the trust is liable to UK income tax; capital gains tax; inheritance tax or stamp duty land or reserve tax.
Ivo Hemelraad, ZEDRA Group Director Corporate, Funds & Legal commented: ‘This is a welcome move by HMRC and is good news for beneficiaries of trusts which have only an indirect holding in UK property and no other assets or income derived from the country”.