We have referred to the transitional rules in recent articles. We thought it might be useful to set these out in full in the table below.
|
Aspect |
Requirements to qualify for transitional treatment |
|
One-page summary |
Not applicable, the one-page summary is required in all suitability reports from 1 October 2020 although certain elements relating to workplace pension may be omitted – see below. |
|
Contingent charging |
Firms may charge contingently where they can demonstrate that:
|
|
Consideration of workplace pension scheme (WPS) |
Firms may:
… where they can demonstrate that:
|
|
Cash flow modelling* |
Firms need not carry out cashflow modelling as set out in the new rules where they can demonstrate that:
|
* The new rules on cash flow modelling
The rules shown below are applicable from 1 October 2020 unless the transitional conditions listed above apply.
Where a firm prepares a cashflow model, it must:
- produce the model in real terms in line with the CPI inflation rate;
- (if the net income is being modelled) ensure that the tax bands and tax limits applied are based on reasonable assumptions;
- take into account all relevant tax charges that may apply in both the ceding arrangement and the proposed arrangement; and
- include stress-testing scenarios to enable the retail client to assess more than one potential outcome.
Advising non-UK clients
Alistair MacDougall Compliance Conduct, EEA, email, EU, FCA, MiFID, passport, PI, vulnerable
Despite the fact that the UK ceased to be a member of the EU/EEA almost a year ago, we are still asked for advice around how a UK firm can take on a new non-UK client or continue to deal with such clients that the firm had pre-BREXIT. We have written before about the general […]