PSCs where shares are held by a trust

When a trust holds shares, the company first asks whether the trustees, acting as trustees, meet any of the first four PSC conditions; if they do, the trustees are recorded as PSCs. It then asks who has the right to exercise, or actually exercises, significant influence or control over the trust’s activities, such as a settlor or protector with power to remove trustees; those people are PSCs under the fifth condition in paragraph 6 of Schedule 1A to the Companies Act 2006. The trust itself is never recorded, because it is not a legal entity.

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Why does the register of members not show the trust?

Section 126 says no notice of any trust, express, implied or constructive, is to be entered on the register of members of a company registered in England and Wales or Northern Ireland, or be receivable by the registrar. The register of members therefore shows the trustees as the holders, with nothing to say they hold on trust.

The PSC regime is different. Section 790LA(5) says nothing in section 126 affects the duty to notify Companies House of a confirmed PSC, so trust interests have to be disclosed there even though they cannot appear on the register of members. The government’s guidance explains that a trust is a legal arrangement rather than a legal entity, so it cannot itself be reported as a relevant legal entity; the people involved are reported instead.

When do the trustees count as PSCs?

Paragraph 6(a) of Schedule 1A asks whether the trustees, in their capacity as such, meet any of the other specified conditions, or would do so if they were individuals: more than 25% of the shares, more than 25% of the votes, the right to appoint or remove a majority of the board, or significant influence or control. The guidance says that if they do, the trustees may be PSCs through each condition they meet and their details must be reported. The GOV.UK summary is direct: if the trust meets any nature of control, record all the trustees as PSCs.

Trustees normally hold trust shares jointly, and paragraph 11 treats each joint holder as holding the whole block, which is why every trustee is caught rather than a fraction of each. A professional trustee, such as a solicitor or accountant appointed as a trustee, is recorded on the same basis as a family trustee. The words “or would do so if they were individuals” mean that using a trust company as trustee does not take the structure outside the fifth condition.

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Who else becomes a PSC through the trust?

Under paragraph 6(b), anyone who has the right to exercise, or actually exercises, significant influence or control over the activities of the trust is a PSC of the company. The statutory guidance on significant influence or control, which paragraph 24 of Schedule 1A requires companies to have regard to, gives examples of such rights: the right to appoint or remove any trustee (other than through the courts or for breach of fiduciary duty), and the right to direct distributions, direct investment decisions, amend the trust deed or revoke the trust.

Actual exercise is also enough. The statutory guidance says a person who regularly issues instructions to the trustees that are generally followed is likely to exercise significant influence or control, and that this may be a settlor or beneficiary who is actively involved in directing the trust. It also lists excepted roles that do not on their own amount to significant influence or control: professional advisers such as lawyers, accountants and investment managers, suppliers and lenders, people exercising statutory functions, and employees acting in the course of their employment. A beneficiary who has none of these rights and takes no part in running the trust does not meet the condition simply by being a beneficiary.

Regulation 7(1)(e) of the Register of People with Significant Control Regulations 2016 requires every applicable statement in Part 5 of Schedule 2 to be filed for a fifth condition PSC. Each statement combines the person’s influence or control over the trust with what the trustees hold, for example more than 25% but not more than 50% of the shares.

What about bare trusts and nominees?

Paragraph 19 of Schedule 1A treats a share held by a nominee as held by the person for whom the nominee acts. The guidance tells companies to consider whether trustees are in substance acting as nominees and, if so, to look through them to the PSC. Where shares are held on a bare trust for an adult who is absolutely entitled, that analysis may point to the beneficiary rather than the trustees; see nominee shareholders and how bare trusts are taxed.

What if a company controls the trust?

The guidance says that if a registrable relevant legal entity, such as a UK company, controls the trust, its details must be reported. If the controlling entity is not a relevant legal entity, the company should keep following the ownership chain until it finds an individual or a registrable relevant legal entity with a majority stake, or is confident none exists.

What happens when shares pass into a will trust?

The guidance says a deceased PSC stays registered until their interest is formally transferred to its new owner, because the executor administers the estate according to the deceased’s wishes. Once the shares are transferred to will trustees, the company reassesses: the trustees may now meet a condition, and anyone with significant influence or control over the will trust may become a fifth condition PSC. See transmission of shares on death. Each change must be notified within 14 days of confirmation.

How does this work in practice?

Illustration only. Patel Holdings Ltd has 100 shares with one vote each. A discretionary trust set up by Raj holds 40 shares. The trustees are Raj’s sister, his brother in law and the family’s solicitor, and the trust deed lets Raj appoint and remove trustees. Raj’s children are beneficiaries but have no powers and take no part.

The trustees together hold 40% of the shares and votes, so all three are PSCs, each in the band more than 25% but not more than 50% for both shares and voting rights.
Raj’s power to appoint and remove trustees gives him the right to exercise significant influence or control over the trust, so he is a PSC under the fifth condition, with the trust statements for shares and for voting rights in the same band.
The children are not PSCs on these facts.

To gather the details the company sends notices to the trustees asking for their own particulars and those of anyone with influence over the trust; see sending notices to identify PSCs.

How does this fit with the Trust Registration Service?

The PSC rules are separate from HMRC’s Trust Registration Service. GOV.UK guidance says all UK resident express trusts must register there unless excluded as a Schedule 3A trust, whether or not they have a tax liability. A trust holding company shares will often need both: TRS registration by the trustees, and PSC reporting by the company. The two records are kept by different bodies and neither replaces the other.

What mistakes come up?

Reporting the trust by name as if it were a company.
Recording only the lead trustee instead of all of them.
Missing the settlor or protector who holds the power to remove trustees.
Treating every beneficiary as a PSC.
Updating the trustees’ names on the register of members after a change of trustees but not notifying Companies House of the PSC change within 14 days.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.