Trust or Company Service Providers and Money Laundering Regulations

If your business is a Trust or Company Service Provider you'll have to register with HM Revenue & Customs (HMRC) under the Money Laundering Regulations unless you're already supervised by another body.

This guide will help you decide if you need to register with HMRC as a Trust or Company Service Provider. It tells you what types of business are covered and what types are not, and links to information about how to register if you need to.

On this page:

What is a Trust or Company Service Provider?

A Trust or Company Service Provider is any firm or sole practitioner whose business is to:

  • form companies or other legal persons
  • act, or arrange for another person to act, as a director or secretary of a company
  • act, or arrange for another person to act, as a partner (or in a similar position) for other legal persons
  • provide a registered office, business address, correspondence address or administrative address for a company, partnership, or other legal person or arrangement
  • act, or arrange for another person to act, as a trustee of an express trust or similar legal arrangement
  • act, or arrange for another person to act, as a nominee shareholder for another person, unless the other person is a company listed on a regulated market which is subject to acceptable disclosure requirements

'Arranging' for someone to act

Arranging for someone to act in a particular capacity has a narrow meaning here. An example would be if you provided a client with a company director, selecting them without further reference back to your client and completing some or all of the formalities to appoint them.

It doesn't include the normal process of headhunting or advertising to find a suitable candidate for a position that a recruitment agency would carry out.

Directors

You only count as a director under the Trust or Company Service Provider rules if:

  • you're formally appointed as a director and your name is registered at Companies House
  • you're a 'shadow director' - you direct or control the business but you're not named as a director

If you're just called a director as part of your job title without being formally appointed, you're not covered by the rules.

Express trusts

An express trust is an arrangement where there is a clear and expressed intention to create a trust. An express trust is usually created by a written document - a trust deed.

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When you need to register as a Trust or Company Service Provider

The types of business covered by the Trust or Company Service Provider rules include:

  • company formation agents
  • providers of registered offices, business addresses, accommodation addresses or correspondence addresses for businesses (other than those run by sole proprietors)
  • any individual or firm providing nominee director services, nominee company secretary services or nominee shareholder services - or other similar services
  • any individual or firm arranging for another person to act as a director, company secretary, partner or professional trustee ('arranging' has the narrow meaning given in the section explaining what a Trust or Company Service Provider is)
  • any individual or firm offering professional trustee services (unless they relate to certain low-risk trusts)
  • any individual or firm providing their services as nominee shareholder (unless they are acting for a company whose securities are listed on a regulated market)
  • any firm providing their services as a company director, company secretary, or partner to another firm (unless the other firm is a member of the same group)
  • any individual providing their services as nominee director or nominee company secretary
  • any individual providing their services as a company director, company secretary or partner to certain high-risk firms

Nominee services

Nominee services are used to keep the true ownership or control of a company confidential. Nominee directors and secretaries may do little to manage or administer the company. Or they may play an active role - but acting on the instructions of others.

Nominee shareholders are the registered holders of the shares in a company but they hold them on behalf of others.

Low-risk trusts

Low-risk trusts include:

  • straightforward express trusts set up by a will that create life interests for spouses or partners
  • straightforward express trusts set up by a will that are for the benefit of people aged under 25, dependents or people with a disability, or that make provision for a charity
  • express lifetime trusts created to manage the affairs of a person with a disability
  • occupational pension schemes and employee share schemes

A discretionary trust is not a low-risk trust.

High-risk firms

A firm is a high-risk firm if it operates:

  • in a jurisdiction that has weak anti-money laundering systems
  • in a high-risk sector

A firm operates in a high-risk sector if:

  • it carries out frequent cash transactions of 15,000 euros or more
  • it is a company operating in the UK but incorporated outside the UK in a jurisdiction that isn't equivalent to the UK
  • some of its share capital is held as unregistered bearer shares

But an individual providing their services to a high-risk firm doesn't have to register with HMRC if that firm is:

  • already supervised under the Money Laundering Regulations
  • a public authority
  • a firm authorised by a public authority to act on their behalf where the only customers are also public authorities

Carrying out an activity 'by way of business'

In most cases you'll know whether you're carrying out a relevant activity by way of business, but there may be some circumstances where you might not be sure.

If you already know that you are in business you do not need to consider this any further.

If you are unsure, you will need to consider the following questions:

  • Are you undertaking one of the activities listed above?
  • Do you advertise or publicise your business activity, or receive referrals from other businesses?
  • Do you aim to make a profit when you carry out this activity?
  • Do you carry out the activity with reasonable or recognisable continuity?

If you answer yes to all of these questions, you are carrying out the activity by way of business. So your business activity needs to be supervised under the Money Laundering Regulations and you'll need to register with HMRC.

If you answer 'No' to all of these questions, you aren't carrying out the activity by way of business. So you don't need to register with HMRC.

If you answer 'no' to some of these questions and you're still not sure, you can contact HMRC for further guidance by email or, if you prefer, you can write to them. Details are available in the section below: 'If you're unsure whether you need to register with HMRC'.

Remember to provide HMRC with your answers to all of the above questions when you ask them for guidance.

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When you don't need to register with HMRC as a Trust or Company Service Provider

You don't have to register with HMRC if you are:

  • an individual employed by a company for which you act as a company director, company secretary or partner, as long as you're not providing your services to a high-risk firm
  • an individual providing company director services, company secretary services or partner services to a firm that is already supervised under the Money Laundering Regulations
  • an individual providing company director services, company secretary services or partner services to a public authority or to a firm authorised by a public authority to act on their behalf where the only customers are also public authorities
  • a trustee of a low-risk trust
  • a recruitment and employment agency that only offers the normal business services of employment agencies in connection with the appointment of a company director, company secretary, partner or professional trustee
  • a will writer

If you provide your services through a personal service company then it will only be subject to the regulations if you would have been subject to them yourself, provided:

  • the personal service company supplies only your services
  • you own or control at least 50 per cent of the company
  • the sole business purpose of the company is to provide your services

Trust or Company Service Providers already registered or supervised elsewhere

If your business is a Trust or Company Service Provider you don't need to register with HMRC under the Money Laundering Regulations if it is already supervised for money laundering purposes by the Financial Services Authority or another supervisory body.

The main supervisory bodies

HMRC is the supervisory authority for Trust or Company Service Providers unless they're supervised by their own supervisory body. The main supervisory bodies are:

  • Financial Services Authority
  • Association of Chartered Certified Accountants
  • Institute of Chartered Accountants of England and Wales
  • Institute of Chartered Accountants of Scotland
  • Institute of Chartered Accountants in Ireland
  • Association of Accounting Technicians
  • Association of International Accountants
  • Association of Taxation Technicians
  • Chartered Institute of Management Accountants
  • Chartered Institute of Taxation
  • International Association of Bookkeepers
  • Institute of Financial Accountants
  • Institute of Certified Bookkeepers
  • Law Society

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If you are unsure whether you need to register with HMRC

If you're unsure whether you need to register you can follow the link below to download a guidance flowchart which will help you decide whether you are carrying out relevant activities ‘by way of business’.

If after reading this guidance you are still unsure or need advice about whether you can contact HMRC for further guidance by email or, if you prefer, in writing at the address below.

Download a flowchart to help individuals acting as company secretaries (PDF 25K)

Download a flowchart to help individuals acting as company directors (PDF 25K)

Email HMRC for advice on registering under the Money Laundering Regulations

Or write to the MLR Central Intervention Team at:

MLR Central Intervention Team
HM Revenue & Customs
7th Floor N/W
Alexander House
21 Victoria House
Southend-on-Sea
SS99 1AG

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Registering with HMRC as a Trust or Company Service Provider

To register with HMRC you'll need to fill in a registration form and provide all the information requested. You'll also need to apply for a fit and proper test. You can find out more about how to register and what the fit and proper test involves by following the links below.

How to register under Money Laundering Regulations

Applying for the fit and proper test

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