With an increasing trend of clients retiring overseas, most professional firms, whether lawyers, accountants or financial advisors, will have a number of clients who have either made the move or are planning to and this can present complications.
Most professional financial advisors pride themselves on building long term relationships with their clients who are often loath to break that relationship, even when they move abroad. The temptation may be to continue to provide advice to them which may on occasions be acceptable but this can be dangerous territory for all concerned.
From a financial planning perspective, the UK Financial Services Authority allows advisers to continue to deal with expat clients, providing they see them when they visit the UK and that advice is given in the UK. However, there remains a responsibility to ensure that the financial advice takes into account all of the client’s circumstances including their tax residency and that any solutions are compliant and effective in the country of residence. It may not always be convenient either, as clients may need interim advice and are not due in the UK for some time.
This is where the system of cross border passporting comes into effect. To be able to advise expat clients at all times, it is necessary to comply with EU regulatory requirements. UK financial advisors can achieve this through the FSA by obtaining a passport for each EU country where advice is to be given but this may not always be practical.
RAFP has the relevant passport for all EU countries and we are able to provide a solution to professional associates, enabling fully compliant financial planning advice to be given.
We are able to achieve this in one of two ways:
- Close co-operation with the existing adviser in areas of financial planning advice, where a cross border passport is required can provide a workable solution, particularly when the existing adviser is providing accounting or legal services.
- For financial advisors providing regulated investment advice, we are able to acquire the clients’ existing business with a value being paid by reference to the continuing trail commission and any new business arising.
Ideally, the new relationship should be established prior to the client moving abroad as pre-departure planning can play a vital role in securing the best solutions. Where clients have already made the move overseas, we are still able to work with them and both options remain available.
Looking for a professional financial advisor? Contact Richard Alexander now.