Bare trust registration -- what to do?

[GoSeigen]

My two daughters age 17 and 15 have designated investment accounts with a broker holding various listed assets, which it appears now need to be registered.

The accounts started life as designated cash bank accounts when the girls were wee. The source of the funds was gifts from their grandparents (possibly small amounts from uncles/aunts too) but none of it from their parents. The intention was that the funds should be held in a bare trust for the girls until they were 18 and the funds were deliberately separated from those given by us parents, we only ever funded their Child Trust Funds.

Now I'm at a loss what to do as, although I did a bit of research into bare trusts the information was scant and they seemed to be a fairly loose sort of structure. Now with registration I have to think a bit harder about them!!

It seems to me that having me named as a trustee is not an issue (as the funds are not sourced from me but from other people income ought not to be taxable in my name, right?), but will there be a problem with the settlors of these accounts? Should I have set up one account per settlor, or is it acceptable that they are all in the one account but logically and legally they are individual bare trusts, one for each person making a gift to the child and requiring registration for each? Fortunately I still have a paper trail so theoretically could track all the funds but really could do without the hassle!


GS

[Nocton]

It's annoying, but very straightforward. Go to: https://www.gov.uk/guidance/register-a- ... -a-trustee and https://www.access.service.gov.uk/login/signin/creds

[Parky]

I'm not surprised that you are confused, as many professionals involved in TRS work are too!
See:-
https://trustsdiscussionforum.co.uk/t/t ... 8/16294/16

This may give you an answer or confuse you further.

I registered a couple of bare trusts the other day and if I remember correctly there is space for multiple settlors should you chose that route (which is what I would do).

[yorkshirelad1]

There's a thread on the TRS at https://lemonfool.co.uk/viewtopic.php?f=49&t=34969.
Your posting here has made me think about Premium Bonds bought for children under 16, but thankfully probably TRS does not apply to PBs held by children. Premium Bond Brochure (https://www.nsandi.com/files/asset/pdf/premium-bonds-brochure.pdf) says: “Children under 16 can hold Premium Bonds. However, the Bonds will need to be looked after by the child’s parent or guardian”. But given the amount of confusion around, I can see someone else might think differently!

[GoSeigen]

I'm not surprised that you are confused, as many professionals involved in TRS work are too!
See:-
https://trustsdiscussionforum.co.uk/t/t ... 8/16294/16

This may give you an answer or confuse you further.

I registered a couple of bare trusts the other day and if I remember correctly there is space for multiple settlors should you chose that route (which is what I would do).

Thank you, (also Nocton and Yorkhisrelad1) very helpful, especially if I can name multiple settlors. I'll start the registration process and see what happens...


GS

[yorkshirelad1]

There's a thread on the TRS at https://lemonfool.co.uk/viewtopic.php?f=49&t=34969.
Your posting here has made me think about Premium Bonds bought for children under 16, but thankfully probably TRS does not apply to PBs held by children. Premium Bond Brochure (https://www.nsandi.com/files/asset/pdf/premium-bonds-brochure.pdf) says: “Children under 16 can hold Premium Bonds. However, the Bonds will need to be looked after by the child’s parent or guardian”. But given the amount of confusion around, I can see someone else might think differently!

I've started a new thread on Premium Bonds for a child under 16 and the (new) HMRC trust reporting scheme to split it out so it doesn't get buried in this thread: see https://www.lemonfool.co.uk/viewtopic.php?f=49&t=35595

[TurboukToo2]

We had a similar situation with bare trusts for each of our children.
It was only when Hargreaves Lansdown sent an " Urgent Action" message on the younger childs account earlier this month that I had to take a proper look.
HL apparently need to know it's a trust and beneficiary details due to their HMRC requirement. They sent a further message on my older childs account a week or so later.

Long story short :

younger child (<18) bare trust is now notified to HL and HMRC. We just made ourselves settlors as we were already adding the income to our dividend income on Self Assessment.

older child (>18) bare trust is also now notified to HL and HMRC. We again just made ourselves settlors and we now have a new UTR number from HMRC and request to complete Self Assessment for this trust as probably going to generate declarable income for the first this tax year.

[tjh290633]

We had a similar situation with bare trusts for each of our children.
It was only when Hargreaves Lansdown sent an " Urgent Action" message on the younger childs account earlier this month that I had to take a proper look.
HL apparently need to know it's a trust and beneficiary details due to their HMRC requirement. They sent a further message on my older childs account a week or so later.

Long story short :

younger child (<18) bare trust is now notified to HL and HMRC. We just made ourselves settlors as we were already adding the income to our dividend income on Self Assessment.

older child (>18) bare trust is also now notified to HL and HMRC. We again just made ourselves settlors and we now have a new UTR number from HMRC and request to complete Self Assessment for this trust as probably going to generate declarable income for the first this tax year.

I have been trying to register the 4 bare trusts that I have for my grandchildren. Total failure as the Government Gateway will only take my personal UTR, and there seems to be no way to get an "Organisational UTR" that I can see. I have raised a complaint and the response is to expect a reply within 2 weeks. Actually I see that I have a reply. I will try to follow their instructions tomorrow.

TJH

[Parky]

We had a similar situation with bare trusts for each of our children.


older child (>18) bare trust is also now notified to HL and HMRC. We again just made ourselves settlors and we now have a new UTR number from HMRC and request to complete Self Assessment for this trust as probably going to generate declarable income for the first this tax year.

You appear to have registered the trust as a taxable trust (having obtained a UTR). A bare trust is not taxable, but the tax on the income should be paid by the beneficiary. HMRC gives you something called a URN for a non-taxable trust. You don't need to submit a self-assessment.

[Parky]

I have been trying to register the 4 bare trusts that I have for my grandchildren. Total failure as the Government Gateway will only take my personal UTR, and there seems to be no way to get an "Organisational UTR" that I can see. I have raised a complaint and the response is to expect a reply within 2 weeks. Actually I see that I have a reply. I will try to follow their instructions tomorrow.

TJH

You have to get a new Government Gateway account for each trust. For bare (non-taxpaying) trusts HMRC will give you a URN (not a UTR) for each trust. See https://www.gov.uk/guidance/register-a- ... -a-trustee. The section on "How to Register".

[tjh290633]

You have to get a new Government Gateway account for each trust. For bare (non-taxpaying) trusts HMRC will give you a URN (not a UTR) for each trust. See https://www.gov.uk/guidance/register-a- ... -a-trustee. The section on "How to Register".

I have tried but get nowhere. There has to be a solution.

TJH

[yorkshirelad1]

Useful article in today's FT
FT: 20 Aug 2022 “Deadline looms for trustees of non-taxable trusts”
https://www.ft.com/content/07ccd182-4528-48a1-a89c-b3a62aaf10f2
https://www.google.co.uk/search?q=site%3Aft.com+deadline+looms+trustees+non-taxable

[Nocton]

You have to get a new Government Gateway account for each trust. For bare (non-taxpaying) trusts HMRC will give you a URN (not a UTR) for each trust. See https://www.gov.uk/guidance/register-a- ... -a-trustee. The section on "How to Register".

I have tried but get nowhere. There has to be a solution.
TJH

Can you say what the problem has been, then those on this thread can perhaps offer you a solution. I found the process quite straightforward.

[helfordpirate]

You have to get a new Government Gateway account for each trust. For bare (non-taxpaying) trusts HMRC will give you a URN (not a UTR) for each trust. See https://www.gov.uk/guidance/register-a- ... -a-trustee. The section on "How to Register".

I have tried but get nowhere. There has to be a solution.
TJH

Can you say what the problem has been, then those on this thread can perhaps offer you a solution. I found the process quite straightforward.

I also thought it was straightforward.
(1) Go to https://www.gov.uk/guidance/register-a- ... -a-trustee
(2) Click on "How to register" in the list of topics
(3) Click on the big green REGISTER NOW button
(4) On the sign-in page, click on "Create Sign-in Details" below the SIGN IN button
(5) Enter email address and wait for email code.
(6) Choose password
(7) Enter full name
(8) Get login details and on next page choose "Organisation" for registering a trust

[GoSeigen]

You have to get a new Government Gateway account for each trust. For bare (non-taxpaying) trusts HMRC will give you a URN (not a UTR) for each trust. See https://www.gov.uk/guidance/register-a- ... -a-trustee. The section on "How to Register".

I have tried but get nowhere. There has to be a solution.
TJH

Can you say what the problem has been, then those on this thread can perhaps offer you a solution. I found the process quite straightforward.

I also thought it was straightforward.
(1) Go to https://www.gov.uk/guidance/register-a- ... -a-trustee
(2) Click on "How to register" in the list of topics
(3) Click on the big green REGISTER NOW button
(4) On the sign-in page, click on "Create Sign-in Details" below the SIGN IN button
(5) Enter email address and wait for email code.
(6) Choose password
(7) Enter full name
(8) Get login details and on next page choose "Organisation" for registering a trust

I succeeded in registering two bare trusts using the above process. Unbelievably bureaucratic requirement for something that seemed of no interest to HMRC just a few years ago...

GS

[tjh290633]

You have to get a new Government Gateway account for each trust. For bare (non-taxpaying) trusts HMRC will give you a URN (not a UTR) for each trust. See https://www.gov.uk/guidance/register-a- ... -a-trustee. The section on "How to Register".

I have tried but get nowhere. There has to be a solution.
TJH

Can you say what the problem has been, then those on this thread can perhaps offer you a solution. I found the process quite straightforward.

I also thought it was straightforward.
(1) Go to https://www.gov.uk/guidance/register-a- ... -a-trustee
(2) Click on "How to register" in the list of topics
(3) Click on the big green REGISTER NOW button
(4) On the sign-in page, click on "Create Sign-in Details" below the SIGN IN button
(5) Enter email address and wait for email code.
(6) Choose password
(7) Enter full name
(8) Get login details and on next page choose "Organisation" for registering a trust

Many thanks. I did not see the "Create sign-in details". HMRC also pointed this out. I am now partway through the process.

TJH

[Bouleversee]

I came onto this Board to ask a question on a totally different matter but this thread caught my eye. I haven't had time to read it in detail but am totally confused. Over the years I have gifted certificated shares in 16 different companies (not huge sums) to my 4 grandchldren with their parents as trustees. 2 companies have been taken over; I have no idea how the trustees invested the proceeds for them; probably in junior ISAs or a savings account. 3 grandchildren are now 18 or over and so the shares are legally theirs though I don't think new certificates have been issued in their sole names. The 4th grandchild is 15. Do these shares have to be registered? I have heard nothing about this until today and the parents haven't mentioned anything about it.

The shares are presumably potentially taxable, subject to allowances and other income, and I had suggested to my daughter that she should consider gradually (bearing cgt in mind) transferring those belonging to the eldest child into an ISA as he is already earning during the placement year of his Uni. course. I don't think she has done anything about it, however. I'll find out but would like to be fully informed about this possible registration requirement first. Incidentally, I should have thought I was the settlor.

My other question will have to wait till tomorrow.

Bouleversee

[Nocton]

If the shares are held in trust then it is the trustees who should register.
As you do not appear to be a trustee, you do not have to do anything.

[Parky]

The trusts should have been registered by September 1st, but apparently HMRC are relaxed about not meeting the deadline.

[yorkshirelad1]

I came onto this Board to ask a question on a totally different matter but this thread caught my eye. I haven't had time to read it in detail but am totally confused. Over the years I have gifted certificated shares in 16 different companies (not huge sums) to my 4 grandchldren with their parents as trustees. 2 companies have been taken over; I have no idea how the trustees invested the proceeds for them; probably in junior ISAs or a savings account. 3 grandchildren are now 18 or over and so the shares are legally theirs though I don't think new certificates have been issued in their sole names. The 4th grandchild is 15. Do these shares have to be registered? I have heard nothing about this until today and the parents haven't mentioned anything about it.

The shares are presumably potentially taxable, subject to allowances and other income, and I had suggested to my daughter that she should consider gradually (bearing cgt in mind) transferring those belonging to the eldest child into an ISA as he is already earning during the placement year of his Uni. course. I don't think she has done anything about it, however. I'll find out but would like to be fully informed about this possible registration requirement first. Incidentally, I should have thought I was the settlor.

My other question will have to wait till tomorrow.

Bouleversee

Junior ISAs are exempt from registering with HMRC's TRS, so if the items gifted were put into a JISA, then it's not relevant.
See e.g. https://www.gov.uk/hmrc-internal-manuals/trust-registration-service-manual/trsm10030