A business needs to be monitored by a supervisory authority if UK Money Laundering Regulations apply to it. Businesses who have HMRC as their supervisory authority can now defer their fee for 6 months or deregister if they have stopped trading due to coronavirus.
9 June 2020
As a result of coronavirus measures, the Government has announced that businesses who are due to renew their money laundering supervision with HMRC can now either:
- defer payment for up to 6 months, or
- deregister if they have stopped trading due to coronavirus
Background and businesses affected
A business needs to be monitored by a supervisory authority if UK Money Laundering Regulations apply to it. Money laundering is exchanging money or assets that were obtained criminally for money or other assets that are ‘clean’. The clean money or assets do not have an obvious link with any criminal activity. Money laundering also includes money that is used to fund terrorism.
If a business handles monies on their clients’ behalf, is not covered by a supervisory authority (such as the Financial Conduct Authority), and is a business in one of the following sectors, HMRC is the designated supervisory authority:
- money service businesses not supervised by the Financial Conduct Authority (FCA)
- high value dealers
- trust or company service providers not supervised by the FCA or a professional body
- accountancy service providers not supervised by a professional body
- estate agency businesses
- bill payment service providers not supervised by the FCA
- telecommunications, digital and IT payment service providers not supervised by the FCA
- art market participants
- letting agency businesses
These businesses need to undertake an annual registration and pay a fee to HMRC.
Fee deferral and deregistration
The fee payment deferral and deregistration options apply to all businesses with an annual fee due between 1 May and 30 September 2020. If a business continues to operate and carry out activity covered by the Money Laundering Regulations (MLR), it must:
- stay registered with HMRC
- meet its obligations under the MLR, to protect its businesses and the UK from criminal activity
HMRC will send you an email reminder before your payment’s due date and you can either:
- pay by your original due date, or
- defer and pay at any time up to 6 months from your original due date
If you choose to defer you do not need to tell HMRC. HMRC will simply contact you again to remind you about your new payment due date.
If you have temporarily closed your business due to coronavirus or stopped all MLR activity, you can also deregister and indicate you no longer need to be supervised by HMRC. Find out more about how to deregister here. That link also signposts how to reregister your business again when it reopens.
There is more detailed guidance on who needs to register for money laundering supervision here.
