Trustees: New HMRC registration requirement

HMRC has introduced a new requirement for certain Trusts to register with its Automatic Exchange of Information (AEOI) portal by 31 December 2025. This is a one-off registration obligation designed to improve compliance with international tax reporting standards.

Which Trusts are affected?

• UK Reporting Financial Institutions (RFIs): Must register even if they have no reportable accounts. Previously, registration was only required if accounts were reportable.
• UK Trustee‑Documented Trusts (TDTs): Trusts with professionally managed financial assets (e.g., investment portfolios) or a professional Trustee (such as a corporate Trustee). Residency of account holders is irrelevant.

Note: RFI and TDT are independent triggers. If either applies, registration is required.

Which Trusts are considered RFIs?

A Trust is a Reporting Financial Institution (RFI) if it meets the CRS/FATCA definition of a financial institution. This generally includes Trusts that:

• Hold financial assets and have them managed by a professional investment manager (e.g., DFM-managed securities portfolios).
• Are treated as an investment entity under CRS/FATCA (typically where most income is from investments and management is by a financial institution).

Even if such a Trust has no reportable accounts (e.g., all beneficiaries are UK‑residents), it must still register with HMRC’s AEOI portal by 31 December 2025.

Exclusions to note:

• Insurance Investment Bonds: The insurer is usually the RFI; the trust itself is generally out of scope unless it is a TDT.
• DGTs/Loan Trusts: Typically bond-based and therefore out of scope unless TDT.
• Pension schemes: Generally exempt as Non-reporting Fis under CRS.

Which Trusts are considered TDTs?

A Trustee‑Documented Trust (TDT) is a trust where:

• The Trustee itself is a Reporting Financial Institution (often a corporate/professional Trustee).
• The Trustee agrees to fulfil CRS/FATCA reporting obligations on behalf of the Trust.
• The Trust is therefore “documented” by its Trustee for compliance purposes.

These Trusts must also register with HMRC by 31 December 2025, even if they have no non-UK beneficiaries or accounts to report.

Trusts not affected

• Ordinary family Trusts with no professional investment management and no corporate Trustee are unlikely to be RFIs or TDTs.
• Trusts holding only insurance bonds (no corporate/professional trustee).
• Charitable Trusts: From 1 January 2026, most charities will be excluded from CRS and can deregister.
• Trusts that are not financial institutions under CRS/FATCA definitions do not need to register.

Practical checklist for Trustees

For each Trust under your control:

Registration details

• Registration must be completed via HMRC’s AEOI portal.
• The Trust itself must be registered (not the individual Trustees).
• The reporting Trustee will be listed as the contact.
• Registration is a one-off requirement, but must be completed by the deadline.

Penalties for non-compliance

• £1,000 initial penalty for failing to register on time.
• £300 per day if the failure continues after the initial penalty notice.

Other key changes

• Charities: Most charities will be excluded from CRS reporting from 1 January 2026 and can deregister.
• Cryptoassets: From 1 January 2026, CRS expands to cover cryptoasset transactions under the Cryptoasset Reporting Framework (CARF).

Recommended Trustee actions

• Identify affected Trusts: Review all Trusts under your control to determine if they qualify as RFIs or TDTs.
• Register with HMRC: Complete registration in the Trust’s name before 31 December 2025.
• Coordinate with professionals: Liaise with investment managers and corporate Trustees to ensure compliance.
• Prepare for future changes: Note deregistration options for charities and anticipate cryptoasset reporting obligations.
• Document compliance: Keep records of registration and communications for audit purposes.

Summary

Trustees of UK RFIs and TDTs must register with HMRC’s AEOI portal by 31 December 2025 to avoid penalties. Charities and cryptoasset reporting rules change from 2026. Immediate action is required to identify affected Trusts and complete registration.