Trust Registration with HMRC: Guide for Trustees – Part Two

In Part 1 of this guide, we explained the basics of registering a trust with HMRC, including who must register, required information, and the importance of URNs and UTRs. In Part 2, we focus on ongoing trustee responsibilities, tax obligations, and practical tips to keep your trust compliant.

Ongoing Reporting Obligations for Trustees

Once a trust is registered on the Trust Registration Service (TRS), trustees must keep HMRC updated for any changes. This includes:

• Adding or removing trustees

• Adding or removing beneficiaries

• Changes to settlors

• Significant changes in trust assets

Failing to update HMRC can lead to penalties and extra administrative work. Many trustees use professional support to ensure updates are completed correctly and on time.

Understanding Different Types of Trusts

Different trusts have different registration and reporting rules. Common types include:

• Bare trusts – beneficiaries have an immediate right to assets

• Interest in possession trusts – beneficiaries are entitled to income from the trust

• Discretionary trusts – trustees decide how and when beneficiaries receive assets

Knowing your trust type ensures correct registration and reporting. For more on trust types and registration, see Part 1.

Penalties for Late or Inaccurate Trust Registration

HMRC can impose fines for late or incorrect registration, including:

• Initial late registration fines – starting at £100 and increasing with continued delay

• Failure to update information – penalties escalate depending on the number of affected individuals

Professional advice can reduce the risk of mistakes and save trustees time and stress.

Trust Registration vs SA900 Tax Returns

Registering a trust does not replace filing a tax return. Trustees with UK tax liabilities must file an SA900 Trust and Estate Tax Return, which covers:

• Income earned by the trust

• Capital gains

• Distributions to beneficiaries

How to submit:

• Online using commercial software – allows submission by 31 January following the tax year

• Paper SA900 forms – must reach HMRC by 31 October

Professional guidance ensures the correct return is prepared, submitted on time, and includes all relevant income or gains.

Overseas Trustees or Beneficiaries

Trusts with overseas trustees or beneficiaries may have additional reporting obligations, such as:

• Disclosing foreign assets

• Complying with HMRC rules for non-UK residents

Professional support is particularly useful in these complex cases to avoid errors and ensure compliance.

Practical Example: Small Family Discretionary Trust

Consider a discretionary trust providing for three children:

• Trustees register the trust on TRS and obtain a URN

• Updates are made when new beneficiaries are added

• Annual SA900 tax returns are filed if the trust earns income

This shows that with careful management and professional advice, even complex trusts can remain compliant with minimal stress.

Staying Compliant as a Trustee

Ongoing compliance is just as important as initial registration. Trustees should:

• Keep digital records of all documents, deeds, and correspondence

• Update HMRC whenever circumstances change

• Record URNs and UTRs carefully for future filings

• Consider professional advice, especially for complex or overseas trusts

For a full overview of how to register your trust and what information HMRC requires, see Part 1.

At Tax Matters, we support trustees through the entire lifecycle of a trust—from initial registration to ongoing reporting and complex scenarios like discretionary or overseas trusts.

Contact us today to ensure your trust remains compliant and stress-free.