We have in recent months reported that some pension scheme trustees, acting by way of business, may be required to register with HMRC for money laundering purposes. HMRC have now issued updated guidance which confirms that directors of trustee companies and those offering professional trustee services to occupational pension schemes are not required to register.

MONEY LAUNDERING – TRUST AND COMPANY SERVICE PROVIDERS

Under the Money Laundering Regulations 2007, individuals and firms carrying out a relevant activity by way of business must be registered with HMRC (unless already regulated by another prescribed body). One of the relevant activities is acting as a Trust and Company Service Provider (TCSP).

When HMRC first issued guidance on this there was great uncertainty as to how, if at all, this would impact on trustees of occupational pension schemes. Of particular concern were those individuals who were receiving remuneration for acting as a trustee of an occupational pension scheme of which they were not a member.

HMRC has now published updated guidance MLR9 which clarifies the issue.

The key paragraph is 6.1.16 of MLR9. This provides that individuals and firms who provide professional services limited to certain low risk trusts, including occupational pension schemes, are not TCSPs. This means that acting as a trustee of an occupational pension scheme, even by way of business, does not give rise to a requirement to register with HMRC for money laundering purposes.

Any occupational pension scheme trustee who has already applied for registration as a TCSP should receive a letter from HMRC by 19 August 2008 - this letter will include information on what they need to do now. We would hope that this would include information on how to apply for a refund of the registration fee!