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.
FCA expectations – temporary long term absence
Richard Foster Compliance 2020, 2021, Certification, Conduct, Directory, FCA, PI, Register, Senior Manager, transfer
Following consultation in CP20/23, which was published in December 2020, the FCA has made changes to the Handbook. The affected sections are: SYSC 25.4 FIT 1.3 SUP 10A.14, 10C.9, 10C.10, 10C.11, 10C.14, 10C Annex 2G and 10C Annex 6R Form D In summary, the changes to the Handbook are intended to reflect the FCA’s […]