TRS deadline is this week! - New rules

 

If you have previously dealt with solicitors when preparing your Will or dealing with a bereavement, you may have recently heard about the new Trust Registration Service (TRS) requirements.

New laws have recently come into force meaning that any trust must now be registered with the TRS (which is part of the Government website).

The deadline for registration is 1^st September 2022

What is a care planning Will?

Solicitors are increasingly seeing clients who are worried about going into care. Specifically, people are worried that they will be forced to sell their homes to pay for care, meaning their loved ones lose out when inheriting on their death.

In order to safeguard at least half of the value of your house, married couples are often advised to incorporate a type of trust into their Will. This is commonly known as one of the following:

 

• Life interest trust (LIT);

• Interest in possession trust (IIP); or

• Immediate post death interest (IPDI).

 

This type of trust allows the surviving spouse to live in the property for the rest of their life (subject to certain conditions). If the surviving spouse goes into residential care, only their half of the sale proceeds can be used towards their care. This means that the deceased spouse’s half is protected for whoever they might direct – often the couple’s children and/or grandchildren.

 

What are the new TRS rules and penalties?

These types of trusts now have to be registered with the TRS before 1^st September 2022, or within 90 days of the first spouse’s death (whichever is later).

If you fail to register the trust by the deadline, you could be subject to penalties from HMRC. It is therefore vital that you seek advice if you have any concerns – as 1^st September approaches, professionals will become busier and so the longer you leave it, the more likely you are to miss the deadline.

 

Do any other trusts need to register?

The vast majority of trusts now need to be registered under the TRS.

If you have questions about whether or not a specific trust needs to be registered, you must approach a solicitor as soon as possible to discuss if you need to register your trust.

 

How can we help?

At Lawson-West, our lawyers can quickly advise whether or not you might need to register and we can even register the trust for you if needed. To discuss your circumstances, please call 0116 212 1000 and ask for the Probate, Wills and Trusts team, or contact us online here.

Trustees could face a penalty if you've missed 1st September 2022 deadline. If you are affected by a penalty or would like TRS advice or support, please contact our Probate, Wills and Trusts team:

 

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