It is worth noting that technology will change the nature and delivery of advice and services to HNWIs. Expectations will change and demand will become more immediate.
Generations of HNWIs to come will be tech-savvy and social media focused, valuing opinions from sources other than technical/financial experts and will become equally as important – we have already seen how the delicate balance of privacy and transparency has become a key issue of concern for HNWIs in the face of media scrutiny.
3) How long does your client plan to stay for?
As an old Yiddish proverb states: “Man plans, God laughs”. You don’t have to be religious to understand the real sentiment here; you can make all the plans you like, but nothing is certain.
Different jurisdictions with different rules impact on how people are taxed in the short and long-term. For example, new UK rules on deemed-domiciled individuals in April 2017 have reduced the amount of time an individual can remain resident in the UK and outside the scope of inheritance tax.
It is therefore important to have a solution in place to tackle the long-term or unexpected changes to clients' plans, therefore managing the impact on their wealth as those plans change.
For those UK-domiciled or deemed-domiciled individuals, wealth invested in a life insurance policy could be written into trust to be outside the scope of inheritance tax in the UK.
Non-UK domiciled HNWIs who want to ensure that wealth, that should not form part of a UK tax estate even after they become UK deemed-domiciled, continues to be protected and excluded, may consider taking out a life policy and placing this into trust while still non-domiciled, making it excluded property for inheritance tax purposes.
4) Are funds accessible?
Different vehicles and structures will have different capabilities and rules on accessing funds.
Investments in certain vehicles or funds may restrict an investor on when and how sums can be released, which may be difficult depending on the jurisdiction.
In addition, persons who in one jurisdiction may be used to taking money out of certain investments or vehicles without encumbrance, can find that accessing funds or investments in another jurisdiction may create an unexpected tax charge.
5) Know the uncertainties
Rapid changes in political, legal and tax landscapes can move the goal posts for the choices we make today, tomorrow or next week – never mind next year.
Keeping compliant with those changes can be burdensome for multi-jurisdictional individuals.