In a move long anticipated by private client professionals and wealth structuring experts, the UK government has announced a de minimis exemption from the Trust Registration Service (TRS) for certain small, non-taxpaying trusts. The policy—unveiled following HM Treasury’s consultation earlier this year—aims to reduce unnecessary regulatory burdens while preserving transparency at scale. The changes, which form part of a broader review of the UK’s anti-money laundering (AML) framework, will be introduced via secondary legislation and are expected to take effect in the coming months.
First established under the 4th and 5th EU Anti-Money Laundering Directives, the TRS was designed to track beneficial ownership of express trusts—a key component of global efforts to crack down on illicit financial flows. Following Brexit, the UK continued expanding the regime, introducing requirements that captured a wide range of domestic and offshore structures, regardless of tax liability. However, the breadth of the registration mandate drew criticism from practitioners and stakeholders alike, especially concerning trusts created for personal, familial, or administrative reasons. Critics argued that the TRS had, in many cases, imposed reporting obligations on entities posing little to no money laundering risk.
The new exemption offers relief to certain trusts that meet all of the following conditions: they are not liable for UK taxes, they do not own or have any interest in UK land or property, their total assets do not exceed £10,000, they receive no more than £5,000 in annual income, and they hold no more than £2,000 in non-financial appreciable assets such as jewelry, antiques, or artwork. Importantly, the relief is not retrospective. It applies only to new trusts created on or after the effective date of the exemption. Should any trust exceed the above thresholds at any time, it must register with the TRS and remain registered thereafter—even if its asset value later declines. The government described the criteria as “clear, verifiable, and proportionate,” noting that they strike a balance between reducing administrative complexity and maintaining oversight of higher-risk structures.
The exemption is likely to benefit settlers looking to establish modest trusts for gifts, minor beneficiaries, or succession planning in non-UK jurisdictions. Family offices and legal advisors have long noted the inefficiency of registering low-value vehicles that posed no systemic risk.
“Trust can now be used for smaller operations” says, Robert de Ruijter, TEP, CEO of DR Asset Planning. “This might be interesting for clients from Latin America, the Middle East or Asia”, he added. “As we prepare Financial Statements for our clients we will be alert together with our clients, as the value of assets can fluctuate and pass the limits mentioned in the TRS”.
The government stopped short of adopting the higher thresholds proposed by many in the industry, some of whom had lobbied for a ceiling of £25,000 in assets and £10,000 in income. Additionally, several important tightening measures were introduced. Non-UK trusts that acquired UK land or property before 6 October 2020—previously exempt—must now register if they still hold the asset once the new rules come into force. Non-UK express trusts holding UK land will also be subject to public access provisions, whereby individuals with a legitimate interest can request access to the trust’s TRS data. These changes aim to close loopholes in earlier frameworks and increase access to beneficial ownership data in cross-border scenarios.
In addition to the de minimis exemption, the new policy expands registration exemptions for certain categories of trusts. Co-ownership property trusts and section 34 Trustee Act 1925 trusts (triggered by the death of a trustee) will no longer be required to register. Trusts created via deeds of variation during estate administration will enjoy a two-year exemption post-settlor death. Scottish survivorship destination trusts, a quirk of Scots law, will also be excluded from TRS obligations. These technical refinements aim to reduce burdens during probate and prevent duplication of estate-related reporting.
While narrow in scope, the exemption signals a larger policy shift toward risk-based AML regulation framework that rewards transparency and tailors scrutiny to actual threat levels. By carving out low-value, non-taxable, and property-free trusts, the UK is aligning itself more closely with jurisdictions that recognize a spectrum of risk within trust structures. This change could also influence international peers as they revisit their own AML regimes. The Treasury stated, “The changes to the TRS will increase trust transparency and strengthen its risk-based approach to the registration of trusts, meeting the objectives of the regulations.”
The revised AML regulations, including the precise implementation timeline for the exemption, are expected to be laid before Parliament in the coming quarter. HMRC will also issue technical guidance for professionals to interpret the thresholds, reporting triggers, and ongoing obligations. Until then, practitioners are advised to proceed cautiously, especially for new trust arrangements under consideration.
In a post-Brexit regulatory landscape defined by constant recalibration, the UK’s move to ease TRS obligations for low-risk trusts offers a rare reprieve. For families, fiduciaries, and estate planners, it brings not only technical relief but a renewed opportunity to use trusts with purpose and proportionality—without inviting unnecessary scrutiny. Whether this signals a broader liberalization or merely a calculated adjustment remains to be seen. For now, it’s a reminder that even in regulation, nuance matters.
Published in 23 July 2025