UK: Offshore Trusts With UK Beneficiaries Will Be Captured Under 4AMLD
4AMLDThe arm of the UK Government is likely to extend into offshore trusts where they contain UK tax paying beneficiaries. Whether or not this information will be linked at an EU level remains to be seen.
Following the introduction of the EU’s 4th Anti-Money Laundering Directive (4AMLD), and recent G20 talks in Turkey, the UK Government has announced that it has agreed to fully implement inter-governmental body, the Financial Action Task Force, recommendations on the importance of transparency of beneficial ownership.
The EU’s 4AMLD sets out a regime for trusts that is separate from that of companies, and includes a register of trusts that will not be available for public inspection. In line with the 4AMLD, Downing Street this week announced that:
- Trustees of express trusts must obtain and hold accurate, sufficient and current beneficial ownership information for their trusts, including the settlor(s), trustee(s) and beneficiaries, accessibly by domestic competent authorities;
- The beneficial ownership information of trusts that generate tax consequences in the UK will be held in a central register, accessible by domestic competent authorities; and
- Trustees of express trusts will disclose their status, and provide beneficial ownership information of their trusts, when acting in their capacity as a trustee.
EU Member States have until June 2017 to implement 4AMLD, but, it remains unclear what is meant by “tax consequences” for the purposes of the 4AMLD. We expect that any UK tax consequence generated by a trust is caught, but we will have to wait and see if national company UBO-registers and trust registers will be linked at an EU level through a central European platform.1.
