Don't drown your post-referendum sorrows, follow these pragmatic rules and get a head-start in your personal risk management instead, says Corinne Staves.
The vote to leave the EU has thrown everything into a spin, including our government, the opposition and our footballers. While the UK stabilises itself, forms a plan and negotiates its exit from the EU, why not take the opportunity to form a strategy for yourself, your family office or your client (as appropriate) and get a head-start when decisions have to be made in due course?
Here are a few practical steps that you and your clients can, and maybe should, be taking in these first days and weeks following the vote.
The team (don’t mention the football…..)
Step back and look at the team supporting you. Does their support depend on the freedom of movement in the EU? Identify the people that would be affected by changes to immigration as these are announced. Nominate a person to whom team members can turn to ask questions or express concerns, even if they will have little or no concrete information in the early stages. It is reassuring just to be listened to, and currently that is pretty much all one can do.
Assets, investment strategy and taxation
Keep the family’s asset classes and performance under regular review, liaising closely with professional advisers as appropriate.
Are they sufficiently diverse? Is there significant exposure within the UK and other EU countries? Knee-jerk changes are unlikely to be advisable, but this will be a key area to keep under close review and/or on which to seek professional advice as information emerges about how the EU’s exit will be achieved.
The VAT rules may change. This will affect owners of private aircraft and yachts in due course. Similar issues may affect the movement of art, fine wine and jewellery by private individuals within the EU currently free from additional taxation. It may be time to enjoy these assets literally, although we cannot, of course, advocate drowning your sorrows as a planning strategy.
Remember the ‘Cinderella’ rules?
Non UK residents should remain aware of their day count. Some non-residents may need to spend more time in the UK as a result of the vote, for example to oversee UK businesses affected by the vote and ensuing political and economic turmoil. Care should be taken to manage the days spent in the UK if there is no intention to trigger UK tax residence. As ever, remember to keep detailed records.
Individuals with investor, student or other visas should be unaffected, as these are granted under the UK’s own rules to non-EU citizens. While the position relating to EU nationals is of course uncertain (and is fast becoming a key bargaining chip in the race to be the next Prime Minister), we have already seen a huge increase in demand and so individuals whose visa renewal dates are imminent may wish to ensure they do not leave renewal to the last minute and/or that they use the premium or super premium services (depending on visa category) for greater peace of mind.
Corinne Staves is a partner at boutique private wealth law firm Maurice Turnor Gardner LLP.