The Trust Registration Service and Question 20 of the Self-Assessment Return

On 9 December, HMRC issued a helpful statement which will be of interest to trustees and their agents who are completing 2019-20 trust returns and have yet to update (or confirm no changes to) the trust’s details on the Trust Registration Service (TRS). 

Trustees and their agents will be aware that as part of the completion of the trust’s self-assessment return, trustees are asked to confirm that they have either updated the TRS (or confirmed that the details held are correct) by answering question 20 on the SA900 return.

For 2017/18 and 2018/19, trusts were able to leave this blank because the functionality to update the register did not exist, but for 2019/20 returns HMRC are asking trustees to address this question.

A number of members have queried with us whether it is strictly necessary to update the TRS before filing the self-assessment return in order to answer question 20 with a 'yes'. We have also been asked whether trustees need to update question 20 with a ‘yes’ once the TRS has been updated where a return has been filed before the TRS was updated.

HMRC released the following statement to ATT and other professional bodies on 9 December 2020:

“HMRC recognises that this is the first year in which trustees have been able to meet their obligations to keep the trust register updated. As explained in the August 2020 Trusts and Estates Newsletter, trustees and agents should ensure that box 20.1 on the SA900 return reflects whether the register has been updated or if a ‘no change’ declaration has been made at the time the return is submitted. However, HMRC will not automatically charge penalties if the box has not been ticked and the register was not updated before the 31 January deadline. Instead HMRC will take a pragmatic approach to charging penalties, particularly where it is clear that trustees or agents have made every effort to meet their obligations.

“Trustees and agents do not need to submit an amended return if they have updated the register, or made a ‘no change’ declaration, after the original return was submitted and the only change to the information on the original return is a tick in box 20.1.” 

This statement is welcome because it effectively lifts the requirement to update the TRS before the trust’s tax return is completed. It also confirms that trustees and their agents do not need to amend any self-assessment returns which have already been filed purely to answer question 20 if they have left it blank.

We had received some requests from members to extend the 31 January 2021 deadline for updating the TRS because of additional covid-related work pressures and problems getting clients through the digital handshake. While HMRC are unable to extend the deadline, the statement about penalties above looks helpful for agents under pressure at this time. The ATT have queried with HMRC what a ‘pragmatic approach’ might look like in practice and will share any further responses we may receive.

In the meantime, trustees or agents struggling to update the TRS by the 31 January deadline should keep evidence of the efforts that they have made to comply with the regulations.

We have updated our ‘users guide’ to the Trust Register to reflect this additional information.