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.
This includes knowing whether a current structure is recognised in another jurisdiction and how it would be taxed. For example, trusts are not recognised in France despite their wide use in the UK.
6) Regulation
The last decade has seen sweeping changes to the regulatory framework, particularly surrounding the financial services world. An example of such change is in the introduction of GDPR, impacting financial services providers and individuals alike.
With added focus on tax and legal reporting, and stricter rules on how personal data is used, stored and processed, data protection will transform how an adviser operates, but will also impact the amount of information available to advisers, and where that information can be used or sent.
Handling regulatory changes – and the pace of change – as an individual is a big task. However, there are some financial solutions that can act like an ‘an umbrella fund’, allowing the investment in different funds with reduced administration to happen one place, under a single asset for the HNWI.
7) Does family come first?
Whether clients are young, married, divorced, with children – or none of the above – knowing who the people that will benefit from their estate are, will allow you, as their adviser, to plan efficiently for the future as the tax implications for different classes of beneficiaries can be stark.
Equally as important is knowing where these individuals are. Many HNW families are spread across countries and continents.
Therefore, cross-border planning and cross-border solutions are key to implementing structures that will follow them across the globe, but also those who will benefit from their estate – and subsequent generations.
Suggest a financial product that can be used to allocate wealth to particular people as beneficiaries or, as in the UK, put into trust to cater for future generations who may not be born, particularly where trustees have ongoing duties to produce, preserve and manage generational wealth.
8) Identifying concerns and goals
Understanding what is important to your HNWI clients will help identify the solutions matching those needs.
A mobile HNWI might value efficient estate planning, legal and tax compliance, asset protection and growth, reduced reporting and administrative burdens, tax deferral or structured family succession.
