HMRC is calling for comments in respect of making “the taxation of trusts simpler, fairer and more transparent”.
The consultation document published in November 2018 focuses on the principle of transparency, especially in relation to non-resident trusts. The names Common Reporting Standard and Trust Registration Service already strike fear into the heart of anyone dealing with trusts, and this consultation encourages “view on whether further measures are required” to tackle “the potential for avoidance and evasion”.
In the aftermath of the Panama Papers scandal, a wave of public suspicion about offshore trusts has paved the way for HMRC to build a rigid reporting structure around trusts over the last two years. Trusts which pay tax in the UK are required to register with HMRC through the Trust Registration Service online. The 5th Money Laundering Directive published in June 2018 will extend registration to any trust, regardless of any tax liability.
These measures betray HMRC’s inherent cynicism of trusts and their continuing efforts to uncover a multitude of cons, tax evasion schemes, and general delinquency which are clearly sheltered by trusts.
The consultation ends on 30 January 2019.
If you are confused about your obligations as a trustee, or would like to discuss trusts generally, please contact Anna Casey-Woodward on 01865 255637 for a no obligation informative conversation.