The responsibilities of a trustee under the UK self-assessment system (for trusts, estates, or registered pension schemes) generally include the following key obligations, based on HMRC guidance for the 2024-2025 tax year. These apply to filing tax returns, calculating and paying tax, and maintaining compliance. Note that specific duties may vary depending on whether you’re a trustee of a general trust/estate (using form SA900) or a registered pension scheme (using form SA970), but the core principles are similar.
1. Keeping Records
- By law, you must maintain accurate and complete records of all income, capital gains, expenses, and relevant financial transactions for the trust, estate, or pension scheme.
- Examples include bank statements, building society interest certificates, dividend vouchers, accounts, and any documentation from professionals (e.g., investment managers).
- Records must be kept for at least 6 years (or longer in some cases). Failure to do so can result in penalties.
- Do not send records with the tax return unless requested, but be prepared to provide them during HMRC enquiries.
2. Completing and Filing the Tax Return
- Determine if a tax return is required (e.g., even if no tax is due or the scheme isn’t taxable, you may still need to file).
- Gather all necessary information and fill in the appropriate form accurately:
- For trusts and estates: Use the Trust and Estate Tax Return (SA900), including any supplementary pages for specific income types (e.g., trade, foreign, capital gains).
- For registered pension schemes: Use the Tax Return for Trustees of Registered Pension Schemes (SA970).
- It’s your responsibility to ensure all relevant sections and supplementary pages are completed correctly—HMRC provides the main pages, but you must identify and include any additional ones needed.
- File on time to avoid automatic penalties:
- Paper returns: By 31 October 2025.
- Online returns: By 31 January 2026.
- If the trust or scheme uses an “accounts basis” (aligning with a 12-month accounting period ending in the tax year), apply it consistently; any change requires reverting to the statutory 6 April to 5 April basis without gaps in reporting.
- Sign the declaration confirming the return is correct and complete to the best of your knowledge.
3. Calculating Tax
- Calculate any Income Tax, Capital Gains Tax, or other liabilities (or request HMRC to do so by filing a paper return by 31 October 2025).
- Use tools like the Tax Calculation Summary working sheet (for individuals or trusts) or the Trustees of Registered Pension Schemes Tax Calculation Guide (SA976) if applicable.
- Account for reliefs, allowances, and deductions (e.g., personal allowances, Gift Aid, pension contributions).
- For pension schemes, base calculations on income and gains; for trusts/estates, include non-savings income, savings, dividends, and gains in the correct tax bands.
4. Paying Tax and Managing Payments
- Pay any tax due by 31 January 2026, including:
- The balance of tax owed for 2024-2025.
- First payment on account for 2025-2026 (if applicable, based on prior year’s liability).
- If tax is paid late, interest and late payment penalties apply (e.g., 5% after 30 days, plus further penalties).
- Make payments on account if the previous year’s tax liability was £1,000 or more (unless 80% or more was deducted at source).
- For pension schemes, no tax may be due on certain income, but you must still report it.
5. Amending Errors and Responding to Enquiries
- If you discover mistakes or changes after filing, notify HMRC promptly (preferably by letter with corrected figures) or submit an amended return to avoid penalties.
- HMRC may enquire into the return within 12 months of receipt, checking figures against records or third-party data (e.g., banks).
- You must cooperate by providing requested documents or explanations.
6. Avoiding Penalties and Compliance
- Late filing incurs an automatic £100 penalty, even if no tax is due. Further penalties apply:
- £10 per day after 3 months (up to £900).
- Additional £300 or 5% of tax due (whichever is higher) after 6 and 12 months.
- Up to 100% (or 200% for offshore matters) if information is deliberately withheld.
- Ensure the return doesn’t result in periods “dropping out of account” due to changes in accounting basis.
- If the trust or scheme isn’t required to file (e.g., not registered or no taxable activity), return the notice to file with an explanation.
Additional Notes
- If you’re unsure, consult HMRC’s helpline (number on your tax return), the Pensions Helpline (0300 123 1079 for pension schemes), or a tax adviser.
- For online filing, register with HMRC’s service and use compatible commercial software.
- Specific rules apply if affected by things like Basis Period Reform or UK/Swiss Tax Cooperation Agreement withholding tax.
- These responsibilities ensure compliance with the self-assessment system, where trustees (not HMRC) are primarily accountable for accurate reporting.
If this relates to a specific type of trust (e.g., pension scheme vs. general trust), provide more details for tailored advice. For full HMRC guidance, refer to gov.uk/self-assessment-tax-returns or the provided documents.