The rules for legacy payments to platforms, commonly known as the ‘sunset clause’, come into force on 6 April 2016.
Changes to ‘legacy’ business will require platforms to have access to clean share classes or to be able to pass on any continuing payments they receive from providers to clients in full in the form of small cash rebates or unit rebates from next April.
Some industry experts have raised concerns about potential price pressures that may arise in the market as platforms try to balance changing charges while maintaining a level of profitability.
That is why it is vital advisers understand how charging is changing and whether the platform you use today will be able to continue to grow and pass on reduced charges to your clients.
This guide will explore the move towards clean share classes, how to raise the subject of a unit conversion with your clients and deciding whether switching or converting is best for them.
Supporting material produced by the Financial Conduct Authority; Lee Coles, head of money after work at Jelf Group; Parmenion; Paul Boston, sales director of Novia; Barry Neilson, business development director at Nucleus; and Alistair Wilson, head of retail platform strategy at Zurich.