Money laundering deadline postponed

HM Revenue and Customs (HMRC) has postponed the deadline for companies to register as part of new rules aimed at stamping out money laundering.

The Money Laundering Regulations 2007 (MLR) requires anyone arranging for another person to act as a director, secretary of a company or partner in a partnership to register as a Trust and Company Service Provider.

They will also be subject to the onerous compliance obligations of the new regulations.

The deadline for registration – which has been put back from April 1 to May 31, 2008 - applies to those businesses that would fall within the definition of Trust and Company Service Provider.

Current HMRC Guidance states that employment agencies and employment businesses fall within the scope of these provisions when they carry out such arrangements.

However, following submissions made by the Recruitment and Employment Confederation (REC) and other industry bodies, the Treasury and HMRC have agreed to review their interpretation of the regulations.

This may result in recruitment businesses being excluded from the scope of the regulations and the extended deadline is to allow time for this review.

When the new rules were announced earlier this year, Economic Secretary, Ed Balls, said these new regulations would strengthen the UK's defences against money laundering and terrorist finance.

He said the regulations will ensure that businesses and consumers in low risk situations face fewer burdens than previously.