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In this series of case studies, based on client testimonials from VouchedFor, FTAdviser speaks to advisers about particularly emotional or complicated financial planning cases to find out how they helped clients at difficult times in their lives.
Adviser name: Johanna Rooney
Firm name: Platinum Financial Planning
Firm size: 6
Client life stage: Accumulation and planning
The problem: The client had a unique situation worked abroad (at sea, off the coast of Qatar) as a commercial diver on a contracting / sole trader basis. He did not fully understand his tax and/or residency situation and how either might be assessed by HM Revenue & Customs.
The client had accumulated significant cash reserves and did not know his options for maximising this money from a tax perspective, nor which product solutions would be best aligned to his planning requirements.
Johanna tells FTAdviser: “This client came to me in his mid career. He had some employment-related pension from a previous job, but had always been predominately self-employed in a niche occupation.
“He came to me for retirement planning, and asked me when he would have to work to. He worried that he had left planning for retirement too late – and in the job he was in, he wanted to retire earlier rather than later.
I started looking at his financial commitments and family commitments, which had always been a priority for him, to build up a financial plan. And then we realised this was no ordinary client.
I had to get under the bonnet of all of this.I would say on the one hand he was financial savvy, with an understanding of basic investment principles, what various asset classes were, the importance of diversification, and an awareness of risk and return, but he had no understanding around tax planning or different products.
And this was where we needed to add value: he had no understanding of his tax status. He was not your usual client in that he worked offshore, and his tax status was anything but run-of-the-mill.
Add to this I had to write to the provider of his old defined benefit scheme, get the information about it, explain to him what it was worth and when it would pay.
I had to get under the bonnet of all of this, and explain all this to him in layman’s terms.
What was the most complicated aspect of the case?
His residency and tax statuses were complicated, as was the international dimension to giving advice.
When someone works offshore they do not always understand what this means for their tax status. Fortunately for him, he had hired a specialist accountant in the UK.
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