ECSH43520 - Exclusions: Regulation 15
Source: gov.uk (2025-01-28)


The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (https://www.legislation.gov.uk/uksi/2017/692/regulation/15) (MLR 2017) regulation 15 provides an exclusion from MLR 2017 obligations, including the requirement to be registered, in a limited range of circumstances, as detailed in this guidance.

How it applies to HMRC Sectors:

Estate agency businesses in Scotland

There is a specific reference to ‘a person preparing a home report, which for these purposes means the documents prescribed for the purposes of section 98, 99(1) or 101(2) of the Housing (Scotland) Act 2006 (duties: information and others)’ being excluded from relevant requirements of MLR 2017. Our published guidance for the sector explains that those who carry out any surveys or valuations, independently of any other estate agency work are not required to register for supervision.

Any business carrying out limited ‘financial activity’

The only categories of ‘financial activity’ supervised by HMRC under the MLR 2017 are:
- The transmission or remittance of money or monetary value – this is excluded from the exception.
- Currency exchange and cheque cashing – the exclusion applies to these activities.
Regulation 15 removes any obligation under MLR 2017 from anyone who would otherwise need to be registered and supervised by HMRC, when they are carrying out financial activity on an occasional or very limited basis. However:
- For HMRC supervised activity this only applies to cheque cashing or currency exchange.
- Anyone whose main business activity (other than an HVD) is within an HMRC supervised sector is not covered by the exclusion.
- The exclusion does apply to an HVD who is carrying out limited or occasional financial activity, but only for that financial activity - they would still need to comply with MLR 2017 in respect of HVD activity.
What is ‘limited or occasional’ financial activity?

The financial activity (currency exchange or cheque cashing) excluded under regulation 15 MLR 2017 must be limited or occasional and meet the following:
- Must not be the transmission or remittance of money (or any representation of monetary value).
- Must not be more than £100,000 per year and be no more than 5% of the total annual turnover of the business.
- Must be ancillary, that is only be with customers of the main business, it must not be available to the general public and must be directly related to the main business.
- The main business activity is not that of a sector supervised by HMRC (other than high value dealers).
- Transactions worth more than 1,000 euros are limited to 1 per customer (this could be a single transaction or a series of smaller transactions that seem to be linked).
The HMRC regulation 15 exclusion test

For the financial activity to be excluded it must be tested against the following:

1. Is the financial activity (cheque cashing or currency exchange) a relevant activity supervised by HMRC for the purposes of MLR 2017? If no, the exclusion cannot apply. If yes, continue.

2. Is the financial activity (cheque cashing or currency exchange) ancillary (See definition above) to the main business activity? If no, the exclusion cannot apply. If yes, continue.

3. Is the financial activity (cheque cashing or currency exchange) limited or occasional (see definition above)? If no, the exclusion cannot apply. If yes, continue.

4. Is the business supervised as an HVD? If yes, the regulation 15 exception applies to the financial activity, but not to high value payments in the main business activity. If no, continue.

5. Is the main business activity liable to be registered for supervision by HMRC in any sector other than HVD? If yes, the regulation 15 MLR 2017 exclusion cannot apply. If no, the regulation 15 MLR 2017 exclusion does apply.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)