UK RESIDENT NON DOMICILED NEEDING SPECIAL ATTENTION

Transcription

1 UK RESIDENT NON DOMICILED NEEDING SPECIAL ATTENTION The number of resident non-domiciled individuals in the UK is growing. Estimates vary but some suggest the figure could be as high as 60,000 foreign individuals who have millionaire status in dollar terms. If you have clients in this position their financial affairs need special attention. In response to this, Barclays Wealth, has developed a focused offering for UK resident non-domiciles and today I am joined by Gary Whitfield who heads up this specialist division to find out more about how they work and the solutions they offer. BARCLAYS WEALTH Wealth Management Tele: +44 (0) A bespoke wealth management service. Barclays Wealth is a concentration of committed wealth experts whose focus is meeting the diverse needs of wealthy clients and those aspiring to become wealthier. We understand that wealth is about more than money. Wealth means something different to everyone, as different as each person's goals, ambitions and dreams. As a Barclays Wealth client, our goal is to provide you a bespoke wealth management service that recognises your unique needs. You may want integrated services based on a close personal relationship. You might prefer to manage your own investments and banking through online trading tools and online access to market information. Our services can be as different as any two people. One thing that is consistent though, is the quality of our people and the relevance of their advice to your situation. We have access to the entire resources of the Barclays Group, so we can link you to the people with the specialist knowledge and experience to make a difference to you. This pooling of expertise guarantees that you work with people who are not only financially astute, but who also understand what building wealth really means to people. GARY WHITFIELD Tele: +44(0) Director Barclays Wealth Direct: +44(0) Barclays Group gary.whitfield@barclays.com Gary Whitfield joined Barclays Private Bank in 2004 and is currently Head of Business Development for the UK Private Bank, a role which sees him managing relationships and business results across the Barclays Group companies. In addition, he is Head of the UK Resident Non-Domiciled proposition for Barclays Wealth that delivers a leading edge advisory service to new expatriates in the UK. Prior to joining Barclays Wealth, Gary spent nine years at the Canadian Imperial Bank of Commerce in a variety of roles, most notably as Director of Wealth Management for Business Banking. This was preceded by seven years at TD Waterhouse during which time he became the youngest recipient of the Fellowship of the Canadian Securities Institute designation. Gary graduated from the University of Western Ontario with a Batchelor of Science degree and holds the following professional qualifications: Certified Financial Planner (CFP), Certified Investment Manager (CIM) and Fellow of the Canadian Securities Institute (FCSI). He is also regulated in the UK (by the Financial Services Authority) as an Investment Advisor (CF21) and Investment Manager (CF27).

2 UK RESIDENT NON DOMICILED NEEDING SPECIAL ATTENTION John Silkin (ProConnections): Hello, I m John Silkin and you re listening to ProConnections. There are a significant and growing number of UK resident non-domiciled individuals in the UK. Estimates vary but some suggest the figure could be as high as 60,000 foreign individuals who have millionaire status in dollar terms. If you have a client in this position their financial affairs need special attention, their circumstances are often complex and there are many benefits to being resident non-domiciled that are just waiting to be accessed so referring your clients to the right partner who can deliver the breadth of solutions they require or indeed that you recommend they need is an important part of your overall service. In response to this Barclays Wealth has developed a focused offering for UK resident nondomiciled clients which brings together a specialist team of bankers and product professionals who have experience in this market and importantly experience of working with professional intermediaries who wish to refer clients. Today I am joined by Gary Whitfield who heads up this specialist division of Barclays Wealth to tell us more about how they work and the solutions they offer. Welcome to Wealthmic Gary. Gary Whitfield (Barclays Wealth): Well thank you. Great to be here today. John Silkin: Gary let me start by asking why a focused offering for UK resident but non-domiciles and broadly speaking what does it offer? Gary Whitfield: Well when we are dealing with the UK resident non-domiciled population these are really needy clients. They are individuals that are relocating to the UK, sometimes for a short period of time but other times for a longer or in some cases on a permanent basis. Barclays Wealth we are dedicated to helping people make the most of their wealth and in the case of these non-doms as we refer to them, that means trying to ensure that we set things up properly for them before they arrive in the UK, make sure that we maintain all of their financial investments and situation while they are here and in a lot of cases helping them to return to another country or their home country. John Silkin: What do you think are the key drivers that bring people specifically here to the UK? Gary Whitfield: I think there s probably 3 or 4 main reasons. The first is the job market and the job market particularly in London is very strong and employed professionals are drawn here to work in the large number of multi-nationals that we have in London. Second is the economy is very conducive to entrepreneurs so we have another group of people who move to this country to establish businesses and the fact that interest rates, including loan and inflation in the country make it a great place to start and establish a business. A third thing I just say that it s a great place to live. The fourth reason would be for the resident non-domiciled tax benefits to living in the UK but I really don t think that is the primary driver. John Silkin: And do resident non-domiciles meet a typical profile or is it a fairly mixed bag? Gary Whitfield: Well I think it s probably a mixed group not any 2 clients aren t really the same. The main thing is they re complex and this is sometimes driven by the unique tax position but the fact that in many cases they are going to have multi-currency issues and things like this to deal with make it a very complex group of clients. In addition to the complexity of the financial needs there is also a lot of well basically just have complex lives. In some cases may have multiple residencies; if they have children they have education requirements which can be very complicated for somebody that s moving around between countries so really in a nutshell it is a very complex group of individuals. John Silkin: And are there any particular large groups that you have identified of people for example coming from particular countries? Gary Whitfield: Yes the UK has always maintained a large salvation community and this continues to grow and prosper so that s certainly the biggest group in the UK but in addition to that we have French, German, Italian and Spanish and of course in the UK particularly in London there s a large American population as well.

3 John Silkin: And what about some of the emerging markets and economies? Gary Whitfield: Well we are also starting to see a large number of Eastern Europeans move into the UK as well as a large and growing population of Russians and as I mentioned earlier the UK economy is very conducive to entrepreneurs and we are finding a lot of people from these countries are establishing businesses in the UK. We are very proud of the fact that in 2007 Euro Money Magazine awarded us the best UK private bank for entrepreneurs so we are obviously well suited to helping this group of individuals move into the UK. John Silkin: And when they arrive here, what do you think are the type of financial challenges they face? Gary Whitfield: As I said earlier I think no 2 clients are exactly the same but there are some basic financial needs that a new individual to the country requires. First obviously bank accounts need to be able to spend their money in the country but for this group of individuals it is important that these bank accounts are set up and structured in a way that we are able to effectively segregate capital from income. So that s the first and main thing that everybody in this situation requires. In terms of day to day transactions an individual would undertake they need to have a credit or debit card. We are able to provide that as well at Barclays Wealth. We have a Wealth Card which again we re able to maintain offshore and this allows anybody that s in this position to pay their credit card from offshore income. So again effectively separating capital and income. And then beyond that there s certainly wider lifestyle issues again mentioned education earlier but housing requirements etc. John Silkin: So clearly a ready-made suite of products there for this community. Gary, in your experience are people who are coming to live here in the UK as a resident non-domicile, are they all aware before they arrive here of all the products and services that are going to be available to them? Gary Whitfield: I think it depends on the individual and what we find is the wealthier individuals are aware of this situation that they are in and that s usually because they have received some tax advice before moving to the country or shortly upon arriving in the country. There s probably a larger group from more affluent res non-dom clients who really don t know all of the advantages that they have and this is why for us at Barclays while education is key, situations where somebody is aware of their situation we can help structure all of their financial affairs to maximise the benefits that they could receive. In other situations where we are able to spot that they are in the situation but they may not be aware of it, we can then refer them to an advisor, tax advisor to receive the proper structure for their financial affairs in a way that s beneficial to them. John Silkin: Are there any single common challenges that every res non-dom will face on arrival that you can help them with? Gary Whitfield: Well everybody needs a place to live, I guess that s the starting point and for anybody that s interested in purchasing a property in this country they may not be aware that we have an offshore mortgage available to them. So in a similar fashion to the way we are able to structure a credit card to pay the card from an offshore income we can do the same thing with an offshore mortgage. So most people would come here even if they are aware that they were a res non-dom might not be aware that there s a benefit to having an offshore mortgage so this is something that very few institutions are doing in the UK right now. John Silkin: An immediate reason there then to need your services. All the solutions that you offer are very focused on resident non-domiciles while they are here in the UK. Does that make your approach very UK centric? Gary Whitfield: Well yes this is the starting point for individuals that are moving to the UK and we are certainly recognised as a strong UK brand but we understand the importance of maintaining these relationships once an individual has left the company and we are able to do that by using any of our offshore operations. In fact we also have private bankers in addition to the ones that are located in the UK working with res non-doms. We have private bankers based in Geneva and Monaco who also specialise in working with this client base and in some cases it makes more sense for somebody that s a resident non-dom perhaps from France to work with a private banker in Monaco. It makes the transition into the UK and back returning to France a lot easier. John Silkin: So focused solutions for those who are currently living here in the UK but all the products and services continue after they have returned home or indeed moved elsewhere. About your presence in the UK, are you solely London-based or do you have offices all over the country?

4 Gary Whitfield: Absolutely we are based locally and I think this is one of the strengths of Barclays Wealth. We have offices across the UK, over 20 offices and we have larger centres located in some of the main cities Bristol, Birmingham, Manchester, Leeds, Newcastle and Edinburgh and all of these centres will have at least one or more accredited and specialised private bankers and these are people that we have trained to work with res non-doms and this population of individuals are really spread across the country now. One of the growing areas for us is in Scotland and Aberdeen where because of the growth of the oil and gas industry there is a lot of either Europeans or Americans that are relocating to Scotland so absolutely key for us to have individuals that can work locally. John Silkin: OK and that s certainly an important point. And another question then I d like to ask you Gary is that of course res non-doms frequently are an affluent community and therefore attractive to lots of wealth managers and indeed private bankers, what s different about the Barclays approach? Gary Whitfield: I have to say it s the people and our approach to relationship management. This is key and selecting this core team that we have that are working with the res non-doms in the country is really key to our success. We are able to match private bankers to specific client needs and in some cases if somebody is coming in from the Middle East and would prefer to deal with somebody that understands that country, that market, we can set them up with a private banker in the Middle East team to work with them. This is a unique part of our prop division and we have a very experienced private banking team that comes from a wide range of backgrounds lawyers, accountants, investment bankers, investment managers etc. So again it s really trying to fit the client to the right private banker is something that we can do. And then behind the team of private bankers we also have a large team of specialists so for an individual that may have a complex credit requirement or investment needs or more structured needs we are able to bring specialists in to work with those individual clients. John Silkin: And how does your approach accommodate the professional advisors that a lot of these resident non-domiciles will have as we have already identified people like solicitors, IFAs, their accountants? Gary Whitfield: OK well I think we really see ourselves working in partnership with any of the advisors that are part of the client s circle of advisories and one of the most challenging things for any advisor whether it is us or a tax advisor is introducing a very important client to another professional. They want to ensure that that client is going to somebody s else s hands that they are going to be well served and we feel that this is the most important part of this partnership or relationship is a 3 way thing with the advisor and the client and will customise the approach to the client in a way that works for everybody. So if the advisor wants more involvement they will certainly be involved, if they want less involvement we can do that as well but making sure that they are kept in the loop all the time is absolutely critical throughout the process. John Silkin: And what would be the compelling reasons for a professional advisor to want to work with Barclays on behalf of their client? Gary Whitfield: I think it is the breadth of our offer we are one of the full service private banks working with res non-doms so we can cover off everything with the client - banking, credit, investment as well as the will structuring or trust issues. The fact that we ve got that breadth and strength of the Barclays brand behind us I think is important. In terms of the investment offer for our clients we have a lot that s available and it is very specific and bespoke to res non-doms. Our structured products for example are issued offshore so that there is protection from Inheritance Tax if something happens to the client. We have a multi-manager product discretionary offer that again is located outside of the country so we are able to work really well for res non-doms and the performance of this product has been very strong in the last 12 months. John Silkin: And are you able to share any examples of how you have indeed worked with the advisors in the past just for anyone listening out there who wants to get a handle on specific example to understand how it works? Gary Whitfield: Yes sure. We had an example recently in Birmingham where we were working with a legal advisor somebody that approached us on behalf of an Asian business owner who is looking to sell his company. We have a corporate finance offer and were able to sit down with the client and talk to them about those transactions before it happened and help to structure them in a way working closelywith the advisor and then as a result of that took the investment management mandate offshore

5 with the proceeds of the sale. Now this was key for this client because by placing these investments offshore we are able to protect their wealth and in fact grow it at a faster rate. John Silkin: Well thanks for that example Gary and growing wealth at a faster rate has always got to appeal to everybody. I d like to finish by asking you a final question. The sheer size of Barclays and its global presence of course is one of its major strengths but what would you say to a professional advisor who might be worried that their client is going to end up a small fish in a big pond? Gary Whitfield: Well I don t think that s the case at all. At Barclays Wealth we look at every client as an individual and I think what we bring to the table is a large organisation with a strong global presence and a fantastic suite of products and solutions. The fact that a client gets introduced to us, can work with a private banker in London, Geneva, Monaco, can structure their financial affairs so that they are in London, Jersey, Monaco, Geneva or in some cases even Singapore, Caribbean Islands I think shows the strength of working with a large organisation. In addition the large products and services that we have available are absolutely leading edge. Just to give you an example within our Services Team we have an entire group of individuals that design our asset allocation strategy and review the performance of all of the funds and investments that we sell. Now a smaller institution isn t going to provide that level of service and performance monitoring so I think there s just way too many advantages of dealing with a large and strong organisation like Barclays Wealth. John Silkin: So compelling reasons all round then to work with Barclays Wealth. Gary thank you very much for joining us today and shedding some light on how you work.