SoS (603) Trusts and Estates

SCHEDULE OF SERVICES (603) TRUSTS AND ESTATES

This schedule should be read alongside your letter of engagement (LoE) and the (300) Standard Terms & Conditions.

Recurring Compliance Work

We will prepare the trust’s or estate’s self-assessment tax return, together with any supplementary pages required, from the information and explanations you provide to us. After obtaining approval from the nominated trustee, executor, or other nominated person on behalf of all the trustees, we will submit the return to HMRC.

We will prepare all inheritance tax (IHT) returns required for the trust or estate from the information and explanations you provide.

We will calculate the income tax, capital gains tax, and inheritance tax liabilities of the trust or estate, and tell you how much to pay and when. Where you ask us to, we will advise on the interest and penalty implications of paying tax late. We will check HMRC’s calculation of your liabilities and, where relevant, initiate repayment claims if tax has been overpaid.

We will advise you on possible tax return-related claims and elections arising from the information you provide. Where you ask us to, we will make those claims and elections in the form required by HMRC.

Where the terms of the trust or estate require income or capital payments to be made to beneficiaries, we will assist you in preparing all necessary forms relating to those payments.

Trust Registration Service (TRS)

Under anti-money laundering legislation, trustees are required to maintain accurate and up-to-date records of the trust’s beneficial owners and to report specified information to HMRC via the Trust Registration Service.

We will advise you on whether the trust is required to be registered on the Trust Registration Service. Where we have separately agreed to handle TRS registration and updates on your behalf, we will do so provided you supply the information we need within the timescale we agree. Otherwise, you are responsible for dealing with all registration requirements and updates, and for confirming to us each year that registration has been completed or is not required and that any required updates have been made.

Any changes to the trust’s details should be notified to us as soon as you become aware of them.

Trust or Estate Accounts

Where separately agreed, we will prepare the income and expenditure, distribution, accumulation, and capital accounts (together with a balance sheet and schedule of investments) of the trust or estate from the accounting records and other information and explanations you provide.

We will not be carrying out any audit work as part of this assignment and will not verify the assets or liabilities of the trust or estate, nor the items of income and expenditure. We cannot undertake to discover any shortcomings in your systems or irregularities on the part of any person involved in the administration of the trust or estate.

Ad hoc queries by, for example, telephone or email are not part of routine compliance and may result in additional fees. Where possible, we will discuss and agree any additional fees in advance, but this is not always practicable and we reserve the right to charge for such work.

Ad Hoc and Advisory Work

Where you ask us to, we will also provide such other taxation and advisory services as we agree from time to time. These services are subject to the terms of your LoE and the (300) Standard Terms & Conditions, unless we issue a separate engagement letter. An additional fee may apply.

Examples of this work include:

Advising on in-year capital gains tax (CGT) reporting requirements on property disposals, and preparing any in-year return and CGT calculation. To advise on tax implications and reporting requirements, we need information as early as possible and before exchange of contracts.
Advising on ad hoc transactions and queries (for example, pre-sale advice on the disposal of trust assets), and calculating any related tax liabilities.
Advising on inheritance tax planning, including IHT exposure, tax efficiency of wills, and the availability of inheritance tax reliefs.
Advising on double tax relief where applicable.
Dealing with any HMRC enquiry into the trust’s or estate’s self-assessment tax return, IHT return, or tax affairs.
Dealing with any assessments or queries raised by HMRC in relation to inheritance tax.
Preparing amended returns and corresponding with HMRC as necessary.

Where the trust has reporting obligations under the Foreign Account Tax Compliance Act (FATCA) or Common Reporting Standard (CRS), this work falls outside the scope of this schedule and will require a separate engagement.

If specialist advice is required, we may need to seek this from, or refer you to, appropriate specialists. We will only do so when instructed by the nominated trustee or executor.

Your Responsibilities

As trustees or executors you are legally responsible for:

Ensuring the trust’s or estate’s self-assessment tax return is correct and complete.
Ensuring all inheritance tax returns are correct and complete.
Filing all returns by the due date.
Paying tax on time.

Failure to meet these obligations may result in penalties and/or interest. Trustees or executors who approve returns cannot delegate this legal responsibility to others. You agree to check that returns we have prepared are correct and complete before you approve them.

To enable us to carry out our work, you agree:

That all returns are made on the basis of full disclosure of all sources of income, charges, allowances, and capital transactions.
To provide all information necessary for dealing with the trust’s or estate’s taxation affairs — we will rely on the information and documents you give us being true, correct, and complete, and will not audit them.
To advise us of distributions made to beneficiaries within 30 days of such an event.
To provide full details of all UK residential property disposals, including associated costs and valuations, before the disposal takes place. Where the trustees may be non-UK resident in the tax year of disposal, or the deceased was non-resident at the date of death, full details of all UK property disposals (residential and non-residential) and disposals of shares in UK property-rich companies must be provided before exchange of contracts. If information is received after this point, we cannot guarantee we can provide advice or submit an in-year return within the 60-day reporting window.
To authorise us to approach such third parties as may be appropriate for information we consider necessary.
To provide us with information in sufficient time for the trust’s or estate’s self-assessment tax return to be completed and submitted by 31 January following the end of the tax year. To achieve this, we must receive all relevant information by 31 October. Where we agree to work to a shorter timescale, an additional fee may apply.
To provide us with information in sufficient time for the trust’s or estate’s inheritance tax returns to be completed and submitted by the due dates.
If the trust carries on a business, and the trust’s turnover approaches the VAT registration threshold, you must notify us promptly so that we can advise you on your obligations and registration requirements.
To have paid our fee in full before we submit returns to HMRC. Where work is complete but our fee remains unpaid, we reserve the right to withhold submission.

You will keep us informed of material changes in circumstances that could affect the income, capital gains, or inheritance tax liabilities of the trust or estate. If you are unsure whether a change is material, please let us know so we can assess its significance.

Where you want us to deal with HMRC communications, please forward all correspondence to us promptly. HMRC is not obliged to copy us in on communications sent directly to you, so it is essential that you pass these to us in time for us to act within any statutory time limits.

You are reminded that under the Trustee Act 2000, it is the trustees’ responsibility to review trust investments regularly and to have a clear investment policy.

Limitation of Liability

Our services are subject to the limitations on our liability set out in your letter of engagement (LoE) and in the (300) Standard Terms & Conditions. These are important provisions and you should read them carefully.