We explain what the HMRC Trust Setup Rules mean in practice, so you do not get caught out after signing a deed or relying on wording in a Will.
Trusts are more than paperwork. They are legal arrangements with trustees, beneficiaries and assets. There are ongoing responsibilities and potential tax effects.
We answer the core question families ask: Do we need to register this trust? Registration links to compliance and to how banks and solicitors will deal with the arrangement. The Trust Registration Service began in 2017 and broadened in October 2020.
We will signpost the rest of the guide: what counts as a trust, when registration is needed, what information you need, how to register step-by-step and what to do afterwards.
Key Takeaways
- Registration is common; some limited exceptions apply.
- The Trust Registration Service supports transparency and anti‑money‑laundering checks.
- Tax and registration are connected but not always the same.
- We use plain English and practical examples for UK homeowners.
- Seek tailored professional advice if you are unsure.
What HMRC means by a trust you may need to register
A deliberately created arrangement can become a registrable trust, even if no one uses that word. We explain how simple wording in a Will or a deed can turn an estate administration into something that needs recording.
How trusts are created
Express trusts are those set up on purpose. They can be made during life by a deed or arise on death under a Will.
UK and non-UK differences
Even if most trustees live abroad, UK rules can apply when UK assets or UK resident trustees are involved. That means registration may still be required.
When an estate becomes registrable
An estate tips into registrable territory if administration lasts beyond two years and the Will contains words such as “to my executors and trustees… to hold on trust for…”.
“Trustees are responsible for registering and for keeping information up to date.”
| Situation | Likely outcome | What trustees should do |
|---|---|---|
| Trust deed created in life | Register on TRS using creation date | Assign a lead trustee and register within deadline |
| Will contains trust wording | Estate may become registrable after 2 years | Monitor administration; register if ongoing trusts remain |
| Non-UK trustees, UK assets | UK rules can still apply | Check residency of trustees and register if needed |
hmrc trust setup rules: when registration on the Trust Registration Service is required
Some family arrangements must be entered on the register even if they never pay tax. The clear trigger is tax liability. If the arrangement faces income tax or capital gains tax on assets or income, the trust registration service is usually needed.
Other charges also matter. Inheritance Tax events, property transaction taxes (SDLT/LBTT/LTT) and Stamp Duty Reserve Tax can all bring an arrangement into scope for the registration service.
The scope widened in October 2020. After that date many non-taxable arrangements still had to register unless they met a narrow exemption. Non-taxable trusts created on or after 6 October 2020 had to register by 1 September 2022 unless excluded.
Timing is crucial. You must register within 90 days of the creation date. For lifetime arrangements that is the date the arrangement was made. For trusts under a Will it is usually the date of death.
Practical checklist: Is it an express arrangement? Has it had UK tax liability recently? If yes, you will likely need to register trust and start registering trust without delay.
Trusts that may be exempt from TRS registration
A handful of specific arrangements qualify for exemption from the register. These exceptions are narrow. We explain the common examples and why you should check the detail before relying on one.
Common exemptions and why they matter
Life insurance-only arrangements usually escape registration when a policy pays out on death or serious illness. These are treated as lower risk because funds flow directly to named beneficiaries.
Pilot arrangements created before 6 October 2020 can be exempt if assets were minimal (often under £100). This protects older planning where little changed after october 2020.
Co-ownership for jointly held homes will often not need registration when ownership is straightforward and no separate form of control exists.
Will-based short-term holdings that keep estate assets for up to two years after death are commonly excluded while administration completes.
Special categories
- Arrangements for bereaved minors or young adults — exemptions may apply if the beneficiary protections are clear.
- Charitable arrangements — some are outside scope when they meet charity conditions.
| Exemption type | Typical limit | When to check |
|---|---|---|
| Life insurance-only | Policy proceeds to named beneficiary | On policy payout |
| Pilot arrangements (pre-6 Oct 2020) | Assets usually ≤ £100 | When reviewing older documents |
| Co-ownership | Joint legal ownership of property | When title is clear |
| Will short-term holding | Up to two years after death | During estate administration |
Note: The type trust and the precise wording in the deed or Will control the outcome. Individuals acting as trustee should not assume an exemption. If you are unsure, seek professional advice on registering a trust before you file.
What information you need before you register a trust
Before you begin registration, gather a clear list of facts about the arrangement and the people involved.
Trust basics to note first
Record the name, the type and the date the arrangement was created. These three items drive most later questions so get them correct.
Settlor details
For the settlor give full name, nationality, residence, and date of birth. If the settlor has died, add date of death and note the estate connection.
Trustees and lead trustee
List each trustee with contact details, NI number or passport, address, email and phone. Confirm mental capacity where prompted.
Appoint a lead trustee. HMRC correspondence and registrations use that person as the main contact, so choose someone organised and reachable.
Beneficiaries and classes
Record named beneficiaries and broad classes such as “children” or “grandchildren”. Include charities by name and registration number.
Use plain descriptions for classes to avoid confusion. Accurate beneficiary details speed dealings with banks and solicitors.
Protectors and other individuals
Include protectors or any individuals who can influence decisions. Leaving them out can cause compliance questions later.
Trust assets and key TRS questions
List main trust assets and answer the TRS prompts: has the arrangement acquired UK land since 6 October 2020; is it on an EEA register; are trustees UK‑based?
Gather titles, asset dates and clear descriptions before you start the online form. It stops you timing out and chasing documents later.
Need more help? For step‑by‑step beneficiary guidance see our beneficiary guidance.
How to set up access for the Trust Registration Service (Government Gateway)
Getting online access for the Trust Registration Service is straightforward when you know what to expect. We guide you step‑by‑step so you can begin registration without stress.
Creating sign‑in details and keeping your Gateway ID secure
Start with a current email. The system sends an access code. That code expires after 30 minutes, so have your inbox open.
Create a secure password next. The site then gives a 12‑digit Government Gateway ID. Save that ID and password in a safe place. You will need them to manage the arrangement later.
Choosing an “Organisation” account and security checks
When you act for an estate or a group, choose an “Organisation” account, not an individual one. This helps keep trustees’ records clear.
The service asks for extra security. You will usually get a text or phone call. Pick the method that suits the least technical trustee.
- Expect early prompts asking if the arrangement is already registered and if you have a UTR.
- Have key information ready: creation date, lead trustee contact, and asset summaries.
Tip:Save logins and keep copies of the main registration information to avoid repeated sign‑ins and delays.
Step-by-step: how to register your trust on HMRC’s TRS
Start by confirming the arrangement’s tax history — this single answer guides much of the registration process.
Confirm tax liability for the current and prior four years
TRS asks whether the arrangement had UK tax liability in the current tax year and in the previous four years. That means liability, not just paid tax.
Liability includes any income, capital gains or other chargeable events that made the arrangement responsible to file or pay tax.
Complete each TRS section carefully
Work through the screens in order: Details, Settlors, Trustees, Beneficiaries, Company ownership/controlling interest, Protectors and Other individuals.
Enter names and dates exactly as on the deed or Will. Small mismatches cause queries and delays.
Declare, save and keep proof
Review answers, submit the declaration and print or save the final confirmation. That document helps with banks, professionals and future tax returns.
- Save progress as you go to avoid timeouts.
- Keep copies of supporting documents against any future queries.
- If you need help, see our guide to registering a trust in Britain.
| Step | Action | Tip |
|---|---|---|
| Tax history | Answer current + 4 years | Be precise about liability |
| Sections | Complete all screens | Use deed/Will for names |
| Finalise | Submit declaration | Save confirmation |
Trust tax and ongoing compliance after setup
Knowing which taxes may apply helps families avoid unexpected bills and late penalties. We set out the key taxation areas in plain terms so trustees can act with confidence.
Understanding liability: income, capital gains and inheritance
Income inside the arrangement — rental receipts, interest or dividends — can create an income tax duty even if beneficiaries do not draw money. Trustees may need to report and pay on that income.
Selling assets can trigger capital gains tax. Keep acquisition dates and values. These figures prove cost and calculate gains when disposals happen.
Inheritance tax can apply on certain transfers and on periodic or exit charges for some structures. These are often the most surprising costs for families.
Property and transaction taxes that can trigger compliance
Buying or selling land may create SDLT, LBTT or LTT liabilities depending on location. Share deals can create SDRT duties. These events can also influence registration and reporting obligations.
| Trigger | Typical tax | Why it matters |
|---|---|---|
| Rental or investment income | Income tax | Requires reporting and possible payments |
| Sale of assets | Capital gains tax | Compute gains using acquisition records |
| Property transactions | SDLT / LBTT / LTT | Can create registration or additional filings |
When to file tax returns and practical record-keeping
Trustees must file tax returns if the arrangement has taxable income, capital gains or other liabilities in the year. That is why TRS questions ask about current and recent tax years.
“Keep a running file of income statements, valuations and decisions so year‑end reporting is not a scramble.”
- Keep clear records of receipts and expenses.
- Store acquisition dates, purchase prices and valuations.
- Note trustee decisions and beneficiary distributions.
Practical tip: Good paperwork reduces professional fees and stress at year end. If in doubt, seek tailored advice early.
What happens after registration and how to keep your trust compliant
Expect a confirmation by post that includes a unique reference you can use with banks and advisers. The lead trustee will receive either a URN or a UTR in that letter.
URN vs UTR: what you’ll receive and why it matters
A URN is a register reference shown like XYTRUST12345678. A UTR is a 10‑digit number used for tax reporting.
Use the URN when firms ask for proof you are registered. Use the UTR for tax returns and payments. Keep both numbers safe.
Keeping the TRS updated when people or details change
Trustees must update registration information when there are changes. This includes new trustees, a beneficiary becoming entitled, or a change of address for the lead contact.
Updates avoid penalties for deliberate or careless failures. They also protect beneficiaries by keeping records accurate and defensible.
Common administration delays and how correct data helps avoid them
Incorrect or missing information causes slowdowns with banks, conveyancers and investment firms. Many delays happen during anti‑money‑laundering checks.
- New trustee appointment — update immediately.
- Beneficiary changes — amend names or class descriptions.
- Lead trustee contact changes — notify TRS without delay.
“Keeping the registration accurate speeds payments and transfers, and reduces queries from firms handling the estate.”
For step‑by‑step guidance on registering or managing the record, see our guide to register a trust and our practical walkthrough at register a trust as a trustee.
Conclusion
Act now, many families only discover registration is needed when a bank or solicitor pauses a transaction.
Most express trusts will need the trust registration service. Exemptions are narrow and estates under a Will can become registrable after two years.
Work out the creation date and aim to register within 90 days. Gather key information first: settlor, trustees, beneficiaries, assets and the dates that matter.
Keep records and update the trust registration record after changes. Non-compliance can lead to fines — deliberate failure may attract a penalty of up to £5,000 — and slow estates.
If you are unsure, seek professional advice on inheritance tax, cross‑border issues or complex arrangements. If you think you need register, map the type, assets and date, then proceed with confidence.