HMRC JPUT a cat among the pigeons

JPUT – Introduction

On 31 January, HMRC changed its guidance on unauthorised unit trusts, including Jersey Property Unit Trusts (JPUTs).

This new guidance has perhaps put a cat among the pigeons.

Original guidance

Previously, HMRC advised that neither authorised nor unauthorised unit trusts needed to be registered on HMRC’s trust register unless the unit trust became liable to certain UK tax liabilities.

Updated guidance for JPUTs

However, the guidance for unauthorised unit trusts has now changed, meaning that JPUTs may need to be registered even if they don’t have a liability to UK tax.

JPUTs will need to be registered if they acquire UK land directly or intend to do so since 6 October 2020.

There are only two situations in which a JPUT may need to be registered: when it becomes liable for UK tax or when it acquires UK land after 6 October 2020.

If a JPUT is required to be registered, the relevant information, including contact details for each trustee and unit holder, will need to be compiled and submitted via HMRC’s online system.

Conclusion

The change in HMRC’s guidance means that many more JPUTs will be required to be registered on HMRC’s trust register.

Trustees and advisers should urgently check whether they have any trusts which should now be registered, and ensure they comply with the registration requirements.

Although HMRC is currently adopting a light-touch approach to penalties, trustees and advisers should not rely on this and should ensure they comply with the registration requirements.

If you have any queries relating to JPUT or tax matters more generally, then please do not hesitate to get in touch.

The content of this article is provided for educational and information purposes only. It is not intended, and should not be construed, as tax or legal advice. We recommend you seek formal tax and legal advice before taking, or refraining from, any action based on the contents of this article.