OFFSHORE ADVICE POST BREXIT
Written by Charlie Palmer on 04/03/2021

BREXIT HAS OPENED UP MORE ADVICE OPPORTUNITIES FOR IFAS

IFAC are shocked by the imperialist ambition of EU refusing to grant equivalent access to UK firms in EU.
The Americans get a better deal than we do!
IFAC put together an article on what you can and cannot do in EEA and USA post BREXIT.
You'll be surprised to find out how BREXIT has made it easier in many ways than before, at least for IFAs.


UK AND EEA

  • Client splits his time between the UK and EEA but is EEA resident for tax purposes. 

Yes, you can continue to advise the client, and can continue to charge him for the advice.

The advice will be regulated by the FCA.  They regulate UK firms, and the location of the advice is not their consideration.

The advice will be covered by FOS, even though he is non resident. (link to fos)

The advice will be covered by FSCS even though he is non resident . (link to FSCS)

Other considerations

  1. Is the firm, and its advisers competent to advise on foreign residents?  
  2. Does the firm’s PI cover advice to non-UK residents?
  3. Disclosure does not override suitability, so restricting the advice to one half of the transact ion – ie the UK angle, is unlikely to be sufficient, if a complaint arises.
  4. US restrictions should be observed carefully, and advice from USA experts required.
  5. The UK regulator position is by default that even 1% of responsibility, means 100% of liability.  This is in line with UK law.


UK DOMICILE, RESIDENT IN USA

  • UK domiciled couple moved to the US and now live there permanently 

Yes, you can continue to advise the client while they remain in the USA. The advice can be delivered across border, and you do not need to buddy up to a USA adviser under any UK legislation.  There are UK advisers with USA links, who specialise in advising USA resident customers, as particular expertise is usually required for USA taxes are worldwide, regardless of residence.

The advice will be regulated by the FCA.  They regulate UK firms, and the location of the advice is not their consideration.

The advice will be covered by FOS, even though he is non resident. 

The advice will be covered by FSCS even though he is non resident . 

Other considerations

  • Most PI policies exclude advice to residents of the USA?
  • Disclosure does not override suitability, so restricting the advice to one half of the transact tion – ie the UK angle, is unlikely to be sufficient, if a complaint arises.


OFFSHORE INTRODUCERS

  • Engaging with overseas advisers/introducers who manage clients with UK pensions. 

IFAC confirm that there are no restriction on the firm advising non-residents with links to a local adviser.  

Where complaints are directed, it will soon become apparent to the complainant that the UK firm’s liability extends to all aspects of the advice, not just the small portion attributable directly to them. 

The advice delivery across border, whether by email, zoom or phone, will be regulated by the FCA.



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