Charities will not have to sign up to a register of trusts which is being created as part of the government’s new anti-money laundering regulations.
When the government first consulted on the changes last year it had been thought that charities would fall within the scope of the Fifth Money Laundering Directive (5MLD), which could have forced all charitable trusts, irrespective of size, to need to register with the government’s new trust registration service (TRS).
This would have placed additional administrative burdens on charitable trusts, particularly smaller ones.
But after lobbying from sector bodies including the Charity Tax Group (CTG), the government has decided that charities will be exempt from registering. A technical consultation launched this month, which said: “Charitable trusts are not in scope to register because the risk of these kinds of trusts being used for money laundering or terrorist financing activity is low”.
John Hemming, chair of CTG, said: “This is a great outcome for charities and vindicates the responses made by CTG and other sector bodies to the original consultation that charities were low risk and should be excluded from registering with the Trust Registration Service.
“This is a great example of common sense prevailing particularly as the rules would otherwise have applied regardless of whether or not the trust has incurred a UK tax consequence.
“We are aware that very small charitable trusts, including those that are excepted from registration with the charity regulators, could have been caught, which would have been unduly onerous given their limited resources.”
|
Related articles
