Executors need not notify end of administration to TRS

Monday, 23 November 2020
HMRC has confirmed in email correspondence with the Association of Tax Technicians (ATT) that executors do not need to use the Trust Registration Service (TRS) to report the end of the estate administration period.
Computer register

Most smaller estates do not need to register on the TRS at all and so do not need to use it to notify HMRC that the administration is complete. However, since 2017, 'complex' estates that have significant income and capital gains, or are worth more than GBP2.5 million, have had to register on the TRS in order to obtain a unique taxpayer reference number (UTR). The service's scope was extended in April 2020 to take into account developments in anti-money laundering regulations, and in its August Trust and Estates Newsletter HMRC requested trustees to update the TRS if their trust has come to an end. No exception was stated for estates.

Concerns that this would be burdensome and time-consuming for executors have now brought a response from HMRC. It says the requirement applies only to 'relevant' taxable trusts registered for the purposes of the EU Fourth Anti-Money Laundering Directive and does not extend to estates registered only to obtain a UTR for self-assessment purposes.

HMRC says it would still prefer personal representatives (PRs) and agents to notify the closure of a registered estate to the TRS, but there is no obligation to do so. Notification can instead be made by correspondence as usual, or just by the self-assessment return. HMRC staff will then update the TRS entry themselves. It notes that the TRS should be used to notify HMRC that the name or address of a PR has changed.

The ATT comments that discussions continue as to ‘whether or not it will be necessary for trustees of trusts which closed prior to April 2020 – and who have already reported their closure to HMRC via self-assessment or letter – to also now update their record on the TRS.’

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