HMRC guidance now indicates that trusts need to be registered with the Trust Registration Service (TRS) before they can report UK property disposals for capital gains tax (CGT). The position affects access to the CGT on UK property reporting system and applies even where a trust would not usually be required to register.
Updated HMRC guidance
Under HMRC’s updated approach, a trust cannot submit a CGT report unless it has first been registered on the TRS and issued with a Unique Taxpayer Reference or Unique Reference Number. This applies regardless of whether the trust is taxable or would otherwise fall outside TRS registration requirements.
In practical terms, trusts that previously had no need to interact with the TRS may now need to complete a registration purely to report a property disposal. The reporting system is therefore no longer accessible without prior registration.
The underlying CGT rules have not changed. What has changed is the administrative sequence. Trustees now need to ensure TRS registration is in place before they can meet their reporting obligations.
60-day reporting deadline remains unchanged
The requirement to report and pay CGT within 60 days of completion continues to apply. UK resident trusts need to report disposals of UK residential property where a CGT liability arises, while non-UK resident trusts need to report disposals of UK property whether or not CGT arises.
The key point is that the deadline has not been extended to accommodate TRS registration. If registration is not completed in time, the trust may be unable to submit the return within the required period.
Impact of updated guidance
The reporting process now follows a strict order. A disposal triggers the need to report, but reporting cannot take place until the trust is registered and a reference number has been issued. Only then can the CGT return be submitted and payment made. The result is timing and sequencing risk. TRS registration can take time, particularly where information is incomplete or HMRC processing is delayed. The 60-day window continues to run regardless, which means delays in registration can lead directly to late filing penalties and interest.
Where a trust has a corporate trustee, the reporting process becomes more complex.
Corporate trustees are not currently able to use the online CGT on UK property account and instead need to submit a paper return. This increases reliance on postal processing and reduces flexibility where deadlines are tight.
In these cases, early preparation becomes even more important, as both TRS registration and paper filing timelines need to be factored into the reporting window.
Payment and overpayment treatment
CGT paid within the 60-day period is a provisional calculation based on available information at the time of disposal. The final position is reconciled through the Self Assessment return for the relevant tax year.
If too much tax has been paid, the excess is not refunded automatically. It is first set against other tax liabilities, and any remaining balance needs to be reclaimed from HMRC. As such, trustees should monitor payments carefully and follow up where necessary.
Key takeaway
TRS registration is now effectively a prerequisite for trusts reporting UK property disposals for CGT, and the timing of that registration will determine whether the 60-day deadline can be met. The change increases the importance of identifying trust ownership early in any property transaction. Trustees and advisers need to confirm TRS status before completion and allow sufficient time for registration where required.
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services Limited - a Marketing & Content Agency for the Professional Services Sector.
