Sati Virdee
by Sati Virdee
The Fifth Money Laundering Directive came into effect in October 2020 and extended the scope of the UK Government’s Trust Registration Service (TRS). This article will focus on one of those changes.
From 01 September 2022, in limited circumstances Her Majesty’s Revenue and Customs (HMRC) may share information held on the TRS with some third parties. Originally, they were only able to share it with other law enforcement agencies. Information will only be shared where either:
HMRC will not share information on specific individuals if doing so would lead to a disproportionate risk of fraud, kidnapping, blackmail, extortion, harassment, violence, and intimidation.
Should one or more of the trust’s beneficial owners may be exposed to a disproportionate risk of harm if their information is released, HMRC must be notified in writing and provided with details of the trust such as the name, trust UTR, and beneficial owners who are at risk of harm including the full reason and the length of time this risk will continue.
If HMRC receives a trust data request (TDT) in relation to a trust, they will review the request and decide if the risk of harm exemption applies. The exemption applies if releasing the beneficial owner’s trust information such as their name, date of birth, nationality, country of residence and beneficial interest in the trust would expose them to a disproportionate risk of harm.
HMRC requires further reports on an annual basis if the risk of harm continues to apply. Reporting a risk of harm is not a guarantee that the exemption will be applied. Reports are only reviewed by HMRC when a TDT request about a specified trust is received. HMRC believes that the data-sharing process should strike an appropriate balance between the needs of investigators and the right to privacy of beneficial owners.
Sati Virdee is an experienced tax professional specialising in all aspects of UK personal tax compliance and planning with a particular interest in tax planning for non-domiciliaries. She is a member of the Chartered Institute of Taxation and Fellow of the Association of Taxations Technicians. Contact Sati.
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