Do property sourcers need AML registration? HMRC rules explained

Yes. Introducing buyers to sellers of property is estate agency work, and HMRC treats property sourcing and deal packaging as within scope. That means you must register with HMRC for anti-money-laundering (AML) supervision before you start trading, whether you work from an office or entirely online.

Registering with HMRC

• Register online through GOV.UK as an estate agency business before you trade. Trading without registration is a criminal offence.
• HMRC charges an annual fee for each premises you work from, and checks the business's owners, officers and managers are fit and proper. Check the current fee on GOV.UK, as HMRC has consulted on raising it.
• Keep your registration number: investors and partners will ask for it, and it belongs on your letters, deal packs and agreements.

The checks you must do

• Treat both the buyer and the seller as your customers, and check the identity of both.
• Check the seller actually owns the property, for example with an HM Land Registry title search.
• Check the buyer's source of funds, and do more checks for higher-risk situations such as complex company structures or overseas money.
• Finish the checks at the right time: before you act for the seller, and by the time an offer is accepted for the buyer.
• Keep records of your checks for at least five years.

What else you need in place

• A written risk assessment of your business and policies for how you manage the risks.
• Training for anyone in your business who deals with customers.
• A named person responsible for reporting suspicions, and a process for reporting to the National Crime Agency.
• Membership of a government-approved property redress scheme, which estate agents must also have.

What happens if you don't comply

HMRC can fine businesses that breach the Money Laundering Regulations and publishes the names of those it has fined. Recent lists have included many estate agency businesses that never registered at all.

This guide is general information, not legal advice. HMRC's guidance for estate agency businesses on GOV.UK is the official source. Upstream puts your AML and redress numbers on every letter, deal pack and agreement automatically.