DST51000 - Responsible Member

DST considers the activities and revenues of a group, but the liability will be upon the individual entities within the group that receive the revenues. To make it simpler to administer, a single entity in the group will be responsible for dealing with all aspects of administration relating to DST with HMRC. This entity is referred to in the legislation as the ‘responsible member’.

By default, the group’s ultimate parent entity will be the responsible member. However, it is possible to nominate another company within the group to be the responsible member.

Nominating an alternate Responsible Member

The ultimate parent can nominate another company to be the responsible member. The nominated company does not need to be a UK company, or have a previous registration with HMRC, although groups may decide it is most convenient to use such a company.

The nomination will only be valid if the ultimate parent:

• nominates a company that is a member of its group, and
• prepares a nomination statement

The nomination statement will only be valid if the ultimate parent agrees in writing to provide the chosen company with everything it may reasonably require in order to comply with its DST obligations. This means the ultimate parent must agree to provide the nominated company with access to the information needed to complete the group’s self-assessment and to answer reasonable requests for information relating to the DST liabilities of members of the group from HMRC. It must also provide sufficient resources for the responsible member to fulfil its DST obligations.

If the group does not nominate a company, or the nominated company does not fulfil the conditions, then the ultimate parent of the group will be the responsible member.

Groups will not need to submit the nomination statement alongside their registration for HMRC services. However, if HMRC requests a copy of the nomination statement as part of a compliance check groups will need to produce it.

Ceasing to be a Responsible Member

The same company will continue to be the responsible member until:

• The ultimate parent nominates a different company (under the same process as above),
• the responsible member ceases to be a company or a member of the group, or
• an officer of Revenue and Customs or the parent revokes the nomination.

A nomination can only be revoked by HMRC where the responsible member is not complying with its obligations under the DST or there is reason to believe that they are not being provided with the necessary information from the group to comply with the obligations.

HMRC will not revoke the nomination for a simple administrative failure. HMRC will only revoke the nomination where the failure to meet an obligation is likely to increase the risk of a loss of tax.