The document discusses the unintended tax consequences of adviser charging post-RDR, specifically regarding VAT. It notes that only two ways exist to facilitate adviser charging - hijacking premiums or surrendering/withdrawing funds with tax consequences. The changes from pre-RDR to post-RDR are discussed, including the loss of commission as a proxy for intermediation. Several examples are provided and it is concluded that achieving the right VAT outcome should be part of professional excellence, though clients who do not complete transactions may need to be invoiced directly for VAT.
Crowdfunding from the Start-Up's Perspective (Series: Crowdfunding)Financial Poise
How can businesses use the tools created by the JOBS Act to access capital? This webinar compares raising money online to traditional methods of capital raising. It also compares each of the different titles available under the JOBS Act. Finally, we discuss and compare the differences between security based crowdfunding and rewards based crowdfunding, exploring those instances where such a method would make sense.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/crowdfunding-from-the-start-ups-perspective-2021/
One of the oldest forms of business financing, factoring is the cash-management tool of choice for many companies. Factoring is very common in certain industries, such as the clothing industry, where long receivables are part of the business cycle.
TROs and Preliminary Injunctions (Series: Newbie Litigator School 101 - Part 1)Financial Poise
Sometimes—often at the beginning of a case—you need the court to take immediate action to protect your client’s interests or to maintain the status quo while the litigation progresses. This webinar discusses procedures and strategies for obtaining temporary restraining orders and preliminary injunctions. The topics discussed include the procedural and substantive requirements for obtaining TROs and preliminary injunctions, some best practices for how to succeed on motions seeking TROs and preliminary injunctions, and how to challenge and defeat those motions.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/tros-and-preliminary-injunctions-2021/
Key Provisions in M&A Agreements (Series: M&A Boot Camp)Financial Poise
Although every deal is different, understanding any purchase/sale agreement will help you understand other purchase sale agreements. Stated another way, most M&A documents include a similar set of sections and use a similar vocabulary. This episode explains specific, common provisions and discusses how buyers and sellers approach these provisions differently, particularly in light of situational differences (e.g. whether the assets being bought and sold are equity of a company or the assets of a company; whether the seller is going to cease to exists or not). Topics covered will include tax issues; corporate governance; closing conditions; representations and warranties; indemnification provisions; earn-outs; restrictive covenants; antitrust; intellectual property; and employment issues.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/key-provisions-in-ma-agreements-2021/
Crowdfunding from the Start-Up's Perspective (Series: Crowdfunding)Financial Poise
How can businesses use the tools created by the JOBS Act to access capital? This webinar compares raising money online to traditional methods of capital raising. It also compares each of the different titles available under the JOBS Act. Finally, we discuss and compare the differences between security based crowdfunding and rewards based crowdfunding, exploring those instances where such a method would make sense.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/crowdfunding-from-the-start-ups-perspective-2021/
One of the oldest forms of business financing, factoring is the cash-management tool of choice for many companies. Factoring is very common in certain industries, such as the clothing industry, where long receivables are part of the business cycle.
TROs and Preliminary Injunctions (Series: Newbie Litigator School 101 - Part 1)Financial Poise
Sometimes—often at the beginning of a case—you need the court to take immediate action to protect your client’s interests or to maintain the status quo while the litigation progresses. This webinar discusses procedures and strategies for obtaining temporary restraining orders and preliminary injunctions. The topics discussed include the procedural and substantive requirements for obtaining TROs and preliminary injunctions, some best practices for how to succeed on motions seeking TROs and preliminary injunctions, and how to challenge and defeat those motions.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/tros-and-preliminary-injunctions-2021/
Key Provisions in M&A Agreements (Series: M&A Boot Camp)Financial Poise
Although every deal is different, understanding any purchase/sale agreement will help you understand other purchase sale agreements. Stated another way, most M&A documents include a similar set of sections and use a similar vocabulary. This episode explains specific, common provisions and discusses how buyers and sellers approach these provisions differently, particularly in light of situational differences (e.g. whether the assets being bought and sold are equity of a company or the assets of a company; whether the seller is going to cease to exists or not). Topics covered will include tax issues; corporate governance; closing conditions; representations and warranties; indemnification provisions; earn-outs; restrictive covenants; antitrust; intellectual property; and employment issues.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/key-provisions-in-ma-agreements-2021/
ADR & Settlement (Series: Newbie Litigator School 101 - Part 1)Financial Poise
Many cases are litigated outside of the court system through the use of alternative dispute resolution methods such as arbitration, and the vast majority of cases settle before they reach trial, either as a result of the parties’ efforts or with the help of a mediator. This webinar covers the basics of arbitration and mediation, presenting an effective case to a neutral third party, and negotiating and documenting a successful settlement, either directly or with a mediator’s assistance.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/adr-settlement-2021/
Alternative Structures - PO Financing, Factoring & MCA (Series: Business Borr...Financial Poise
Purchase-order financing (P/O financing) is a type of asset-based loan designed to extend credit to a company that needs cash quickly, to fill a customer order. A company may operate with such a small amount of working capital that it cannot afford to pay the cost of producing a customer’s order. P/O financing enables such a company to not turn away business, by borrowing from a lender using the purchase order itself as collateral to support a loan.
Factoring is one of the oldest forms of business financing. Note that the term is “financing” rather than “loan” because factoring is not actually a loan. In a typical factoring arrangement, the company needing financing makes a sale, delivers the product or service and generates an invoice. The factor (the funding source) then purchases the right to collect on that invoice by agreeing to pay the company in need of financing the amount of the invoice minus a discount.
MCA lending is, in summary, an advance on a company’s sales. Financing through a merchant cash advance (MCA) is used mostly by companies that accept credit and debit cards for most of their sales, typically retailers and restaurants. The concept is this: funder purchases a portion of the company’s future credit card receivables for a discounted lump sum. The MCA funder receives the purchased credit card receivables as they are generated either by taking a percentage of the company’s daily credit card proceeds or by debiting a certain amount of funds from the company’s bank account. Depending on the risk profile of the company, it can be a more expensive form of financing for a business compared to other types of financing.
What these three things have in common is that they are each a type of “alternative lending.” Alternative to what? To the type of loan a company can get from a “regulated” commercial bank. This webinar explains these types of financing arrangements, what to consider before entering into them, and provides some tips on how to negotiate them.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/alternative-structures-po-financing-factoring-mca-2021/
Crowdfinance -101 (Series: Crypto, Crowdfunding & Other Crazy Concepts)Financial Poise
What is the “crowd” in Crowdfinance? What does the crowd thus buy and by what means and modes? And why should the crowd do this rather than put its money to work otherwise? What are the old (and continuing) modes for marketing and selling private securities? What is it like to purchase private securities from on-line portals? How are risks of fraud and mistake allocated there? Do on-line portals help get the rest of us in on unicorns in utero? How are equity securities purchased by the crowd turned into money? Is there a secondary market for private securities? Should ICOs be understood as crowdfinance by other means?
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/crowdfinance-101-2021/
Crowdfunding from the Start-Up's Perspective (Series: Crowdfunding 2020) Financial Poise
How can businesses use the tools created by the JOBS Act to access capital? This webinar compares raising money online to traditional methods of capital raising. It also compares each of the different titles available under the JOBS Act. Finally, we discuss and compare the differences between security based crowdfunding and rewards based crowdfunding, exploring those instances where such a method would make sense.
To listen to this webinar on demand, go to: https://www.financialpoise.com/financial-poise-webinars/crowdfunding-from-the-start-ups-perspective-2020/
Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. Factoring is commonly referred to as accounts receivable factoring, invoice factoring, and sometimes accounts receivable financing.
There are three parties directly involved: the factor who purchases the receivable, the one who sells the receivable, and the debtor who has a financial liability that requires him or her to make a payment to the owner of the invoice.
There are various types of factoring:
Recourse, Non - recourse, maturity and cross - border factoring.
ESOPs 101 (Series: Cross-Training for Business Lawyers 2020) Financial Poise
Employee stock ownership plans (ESOPs) are plans regulated by the Employee Retirement Income Security Act (ERISA) and designed to allow employees to invest in the stock of their employer. The shareholder participants/employees as well as the sponsoring company generally receive tax benefits through the use of the plan. And while they are generally touted as designed to promote employees’ interest and efforts in maximizing the value of the company for the benefit of both employer and employees, ESOPs are often used as a method of corporate finance by the sponsoring company.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/esops-101-2020/
In this session experts discuss in-sourcing and cost-effective contracting innovations that are already working in organizations such as the Millennium Challenge Corporation.
Paying for Litigation- Hourly, Contingency, Third Party Financing & More (Ser...Financial Poise
As the cost and duration of litigation continue to increase, clients have begun demanding fee arrangements that deliver maximum value and best mitigate risk. This webinar explores the mechanics and pros and cons of various fee arrangements, from hourly to contingent to mixtures of the two. We also discuss the increasingly popular option of third-party litigation finance.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/paying-for-litigation-hourly-contingency-third-party-financing-more-2021/
Help, My Business is In Trouble! (Series: Restructuring, Insolvency & Trouble...Financial Poise
When a business becomes financially troubled, the business owner often experiences denial, paralysis, or both. Lenders commonly lose confidence and then trust in the business, as communications tend to break down, deadlines are missed, and promises are broken. Small business owners commonly have issued personal guarantees, so business failure can often lead to personal financial stress. The good news is the business and business owner usually has some options, and even some leverage. This webinar explains what a business owner should- and should not- consider and do when dealing with financial trouble. Specific topics include discussion of bankruptcy (Chapters 7 and 11); assignments for the benefit of creditors; and friendly foreclosures. This webinar provides the business owner and her advisors with an overview of various restructuring and liquidation methods, a framework for how to decide between them, and practical tips for traversing the difficult environment that is financial distress.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/help-my-business-is-in-trouble-2021/
General Liability, Umbrella/Excess Coverage, Commercial Auto-Workers’ Compens...Financial Poise
As a business owner, there are a plethora of choices when it comes to insurance. This webinar touches upon all you need to know about General Liability, Umbrella/Excess Coverage, Commercial Auto Insurance, and Workers’ Compensation insurance.
General liability coverage protects the business from third party suits for Property and Bodily Injury claims. The panelists also look at potential product liability or intellectual property exposure that is not covered. Most business owners understand that commercial umbrella is a must, but how do you determine how much is the right amount? The panelists will also examine why Hired/Non-Owned is important when it comes to Commercial Auto coverage.The panelists will also touch upon best practices for managing employees who drive for your business with their own cars.
The panelists will also cover Workers’ Compensation insurance. Topics discussed include managing the costs of the insurance itself as well as the proper management of workers compensation claims. Other topics discussed include codes and classification errors, how to get money back from the insurer, as well as best practices for Independent Contractors.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/general-liability-umbrella-excess-coverage-commercial-auto-workers-compensation-2021/
Profitable Customer Acquisition for Banks and Credit Unions. Traditional marketing strategies are ineffective and inefficient resulting in significant missed opportunities for Community Banks and Credit Unions. OptiRate offers a unique approach that enables Banks & Credit Unions to attract profitable customers at a fraction of their current customer acquisition costs.
ADR & Settlement (Series: Newbie Litigator School 101 - Part 1)Financial Poise
Many cases are litigated outside of the court system through the use of alternative dispute resolution methods such as arbitration, and the vast majority of cases settle before they reach trial, either as a result of the parties’ efforts or with the help of a mediator. This webinar covers the basics of arbitration and mediation, presenting an effective case to a neutral third party, and negotiating and documenting a successful settlement, either directly or with a mediator’s assistance.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/adr-settlement-2021/
Alternative Structures - PO Financing, Factoring & MCA (Series: Business Borr...Financial Poise
Purchase-order financing (P/O financing) is a type of asset-based loan designed to extend credit to a company that needs cash quickly, to fill a customer order. A company may operate with such a small amount of working capital that it cannot afford to pay the cost of producing a customer’s order. P/O financing enables such a company to not turn away business, by borrowing from a lender using the purchase order itself as collateral to support a loan.
Factoring is one of the oldest forms of business financing. Note that the term is “financing” rather than “loan” because factoring is not actually a loan. In a typical factoring arrangement, the company needing financing makes a sale, delivers the product or service and generates an invoice. The factor (the funding source) then purchases the right to collect on that invoice by agreeing to pay the company in need of financing the amount of the invoice minus a discount.
MCA lending is, in summary, an advance on a company’s sales. Financing through a merchant cash advance (MCA) is used mostly by companies that accept credit and debit cards for most of their sales, typically retailers and restaurants. The concept is this: funder purchases a portion of the company’s future credit card receivables for a discounted lump sum. The MCA funder receives the purchased credit card receivables as they are generated either by taking a percentage of the company’s daily credit card proceeds or by debiting a certain amount of funds from the company’s bank account. Depending on the risk profile of the company, it can be a more expensive form of financing for a business compared to other types of financing.
What these three things have in common is that they are each a type of “alternative lending.” Alternative to what? To the type of loan a company can get from a “regulated” commercial bank. This webinar explains these types of financing arrangements, what to consider before entering into them, and provides some tips on how to negotiate them.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/alternative-structures-po-financing-factoring-mca-2021/
Crowdfinance -101 (Series: Crypto, Crowdfunding & Other Crazy Concepts)Financial Poise
What is the “crowd” in Crowdfinance? What does the crowd thus buy and by what means and modes? And why should the crowd do this rather than put its money to work otherwise? What are the old (and continuing) modes for marketing and selling private securities? What is it like to purchase private securities from on-line portals? How are risks of fraud and mistake allocated there? Do on-line portals help get the rest of us in on unicorns in utero? How are equity securities purchased by the crowd turned into money? Is there a secondary market for private securities? Should ICOs be understood as crowdfinance by other means?
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/crowdfinance-101-2021/
Crowdfunding from the Start-Up's Perspective (Series: Crowdfunding 2020) Financial Poise
How can businesses use the tools created by the JOBS Act to access capital? This webinar compares raising money online to traditional methods of capital raising. It also compares each of the different titles available under the JOBS Act. Finally, we discuss and compare the differences between security based crowdfunding and rewards based crowdfunding, exploring those instances where such a method would make sense.
To listen to this webinar on demand, go to: https://www.financialpoise.com/financial-poise-webinars/crowdfunding-from-the-start-ups-perspective-2020/
Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. Factoring is commonly referred to as accounts receivable factoring, invoice factoring, and sometimes accounts receivable financing.
There are three parties directly involved: the factor who purchases the receivable, the one who sells the receivable, and the debtor who has a financial liability that requires him or her to make a payment to the owner of the invoice.
There are various types of factoring:
Recourse, Non - recourse, maturity and cross - border factoring.
ESOPs 101 (Series: Cross-Training for Business Lawyers 2020) Financial Poise
Employee stock ownership plans (ESOPs) are plans regulated by the Employee Retirement Income Security Act (ERISA) and designed to allow employees to invest in the stock of their employer. The shareholder participants/employees as well as the sponsoring company generally receive tax benefits through the use of the plan. And while they are generally touted as designed to promote employees’ interest and efforts in maximizing the value of the company for the benefit of both employer and employees, ESOPs are often used as a method of corporate finance by the sponsoring company.
To listen to this webinar on-demand, go to: https://www.financialpoise.com/financial-poise-webinars/esops-101-2020/
In this session experts discuss in-sourcing and cost-effective contracting innovations that are already working in organizations such as the Millennium Challenge Corporation.
Paying for Litigation- Hourly, Contingency, Third Party Financing & More (Ser...Financial Poise
As the cost and duration of litigation continue to increase, clients have begun demanding fee arrangements that deliver maximum value and best mitigate risk. This webinar explores the mechanics and pros and cons of various fee arrangements, from hourly to contingent to mixtures of the two. We also discuss the increasingly popular option of third-party litigation finance.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/paying-for-litigation-hourly-contingency-third-party-financing-more-2021/
Help, My Business is In Trouble! (Series: Restructuring, Insolvency & Trouble...Financial Poise
When a business becomes financially troubled, the business owner often experiences denial, paralysis, or both. Lenders commonly lose confidence and then trust in the business, as communications tend to break down, deadlines are missed, and promises are broken. Small business owners commonly have issued personal guarantees, so business failure can often lead to personal financial stress. The good news is the business and business owner usually has some options, and even some leverage. This webinar explains what a business owner should- and should not- consider and do when dealing with financial trouble. Specific topics include discussion of bankruptcy (Chapters 7 and 11); assignments for the benefit of creditors; and friendly foreclosures. This webinar provides the business owner and her advisors with an overview of various restructuring and liquidation methods, a framework for how to decide between them, and practical tips for traversing the difficult environment that is financial distress.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/help-my-business-is-in-trouble-2021/
General Liability, Umbrella/Excess Coverage, Commercial Auto-Workers’ Compens...Financial Poise
As a business owner, there are a plethora of choices when it comes to insurance. This webinar touches upon all you need to know about General Liability, Umbrella/Excess Coverage, Commercial Auto Insurance, and Workers’ Compensation insurance.
General liability coverage protects the business from third party suits for Property and Bodily Injury claims. The panelists also look at potential product liability or intellectual property exposure that is not covered. Most business owners understand that commercial umbrella is a must, but how do you determine how much is the right amount? The panelists will also examine why Hired/Non-Owned is important when it comes to Commercial Auto coverage.The panelists will also touch upon best practices for managing employees who drive for your business with their own cars.
The panelists will also cover Workers’ Compensation insurance. Topics discussed include managing the costs of the insurance itself as well as the proper management of workers compensation claims. Other topics discussed include codes and classification errors, how to get money back from the insurer, as well as best practices for Independent Contractors.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/general-liability-umbrella-excess-coverage-commercial-auto-workers-compensation-2021/
Profitable Customer Acquisition for Banks and Credit Unions. Traditional marketing strategies are ineffective and inefficient resulting in significant missed opportunities for Community Banks and Credit Unions. OptiRate offers a unique approach that enables Banks & Credit Unions to attract profitable customers at a fraction of their current customer acquisition costs.
High Net Worth Customer Acquisition for Banks and Credit Unions | OptiRateSerge Milman
Overview of the Banking sector competitive environment, and relative positioning of Community Banks and Credit Unions vs Mega-Banks. Why Community FIs should focus on High Net Worth Customers and how OptiRate can help.
Business Strategy for Banks and Credit UnionsSerge Milman
Webinar presented on August 7, 2013 on WhyBusiness Strategy is Essential for Community Banks and Credit Unions. Recording of the webinar can be accessed http://bankblog.optirate.com/business-strategy-essential/
Study: The Future of VR, AR and Self-Driving CarsLinkedIn
We asked LinkedIn members worldwide about their levels of interest in the latest wave of technology: whether they’re using wearables, and whether they intend to buy self-driving cars and VR headsets as they become available. We asked them too about their attitudes to technology and to the growing role of Artificial Intelligence (AI) in the devices that they use. The answers were fascinating – and in many cases, surprising.
This SlideShare explores the full results of this study, including detailed market-by-market breakdowns of intention levels for each technology – and how attitudes change with age, location and seniority level. If you’re marketing a tech brand – or planning to use VR and wearables to reach a professional audience – then these are insights you won’t want to miss.
An Overview of Transaction Advisory Services in DubaiAcquara
Transaction advisory services (TAS) refer to a range of professional services that help organizations with mergers and acquisitions, divestitures, joint ventures, restructuring, and other types of transactions. These services are typically provided by accounting, consulting, or investment banking firms, and are designed to help clients make informed decisions about their transactional activities
Dodd-Frank Compliance and Technology Summer Meeting 2013Jeffrey C.Y. Li
Atlas Communications Technology recently co-sponsored the Dodd-Frank Compliance and Technology Summer Meeting. The presentation was an introduction to the complexities of the Dodd-Frank Wall Street Reform and Consumer Protection Act, what firms need to do to bring themselves into compliance, and the technology that can help enterprises meet the stringent demands of the act.
For more information about this conference, or to learn about our Fall meeting in September featuring one of the authors of the act, Congressman Jim Himes, please call 1-855-Dodd Frank (1-855-363-3372) for any questions, or if you wish to talk to one of our presenters today to talk about taking the next steps towards Dodd-Frank Compliance
Atlas Presentation 2013 07-09 dodd-frank summer meeting v1-0 (for online)
Advisers will be required to act in the best interest of their retail clients and place their clients’ interests ahead of their own and those of the licensee and employer when developing and providing personal advice.
A deposit is a pre-agreed instalment towards the purchase price in a sale contract.
The Courts have held that the 2 functions of a deposit are to be:
- an earnest commitment to bind the bargain, which means a deposit acts as an indication the Buyer is serious in carrying out the bargain; and
- a guarantee of due performance, that is security of the performance.
A deposit is usually paid at or upon shortly upon the buyer’s signing of the contract.
Usually, a deposit should be no more than 10% of the total purchase price, and commonly may be less. Note: there is no specific laws on that deposit percentage amount per se*.
The other practical, commercial and financial reasons for why a deposit is useful:
> Often the seller will incur not-insignificant fees and expenses (e.g. sale preparatory work and undergoing due diligence, applying to lessor for consent to assignment of lease etc), independent of whether the actual contract proceeds to settlement or completion. So may be also used to partially-compensate for some of those costs incurred If the buyer ultimately walks away”.
> Loss of potential, other sale opportunities during the express or implied exclusivity period during the conditions precedent of sale contract. This could be months or longer
> It's good to have the buyer show it has “skin in the game” by having such "hurt money" put upfront on & the table.
Tip: Even with the best of Confidentiality Deeds/NDAs , the deposit helps reinforce the value and proprietary nature of the seller’s business or entity.
> Not uncommonly, the Buyer entity may be newly-established . Therefore, if there is default or repudiation, even if they are subsequently pursued by the seller, the Buyer may not have any actual capitalisation to be realised against!
> Lastly, if a buyer or won’t (or can’t!?) put up even the deposit, then you should have serious concerns about their financial capacity to commit all the way through the transaction.
In recent years the Financial Services Industry has begun to experience
dramatic changes, to include changing client demands, increasing
regulations and a desire by Reps to achieve a more stable income.
These changes have a DIRECT impact on YOU as a Financial
Representative. And YOU like many others may be wondering…
How do I adjust to these changes and add value to my business?
2017 Dean-Willcocks Advisory Presentation | Minimising exposure of profession...Ron Dean-Willcocks
Utilising over 80 years of experience, Dean-Willcocks Advisory provides expert insolvency solutions throughout Australia. In April 2017 Dean-Willcocks Advisory presented their paper on minimising exposure of professional advisors in the event of client insolvency to professionals in Bathurst and Dubbo, NSW.
VCs are exposed to unique challenges and risks when selling portfolio companies, and what is acceptable from a company's perspective may not be optimal for the investor base. An understanding of what goes wrong after companies are sold helps investors focus on effective planning strategies to protect returns and minimize exposure of their funds after closing.
Structuring and Planning the M&A Transaction (Series: Private Company M&A Boo...Financial Poise
There is an old carpenters’ expression, “measure twice, cut once.” M&A work is just one of many areas in business and law where this expression resonates. Buyers and sellers, like chess players anticipating many moves in advance, should envision and plan the route to get a deal done, including anticipated detours, at the onset of the transaction.
This webinar discusses the similarities and differences between basic M&A transaction structures; purchase price payment concerns; the most common issues that arise in the early stages of M&A transactions of all kinds; the relationship between ostensibly unrelated sections of an M&A agreement; and transaction timeline. One focus of this episode is a threshold question in many deals: whether the buyer will buy equity or assets. This episode will, in summary form, cover many of the issues discussed in greater depth in subsequent episodes.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/structuring-and-planning-the-ma-transaction-2020/
Investing in Commercial Property (Series: Real Estate Investing 101 - 2020) Financial Poise
Before taking the plunge into commercial real estate investing, one should have a clear understanding of how to select the right location, preferred type and class of property, what due diligence to do, how to secure financing, how to negotiate a deal, and how to manage the property going forward as a commercial landlord. This Financial Poise panel explains the process from looking for the investment, to contract, to closing, and beyond.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/investing-in-commercial-property-2020/
4. New Regulation - Lafollette's Seaman's Act was
signed into law on March 4, 1915
Passenger Deaths - 818
Passenger Deaths - 844
5. Unintended Tax Consequences
of Adviser Charging (AC)
• VAT
• Only two ways of getting money from a
product to facilitate AC
• Hijack the Premiums
• Surrender/Withdraw/Redeem – with tax consequences of
Action
• Facilitating charges from within tax
wrappers – client best interests
6. So what Changes?
• Pre – RDR • Post – RDR
– Tax Legislation – Tax Legislation
• VAT Act 1994 • Still VAT Act 1994
– Commission – Commission
• Was regarded as the proxy • Gone apart from Legacy
indicator for • We lose our proxy indicator
Intermediation for Intermediation
– Fees for Advice – Fees for Advice
• Often times VAT added – HMRC Guidance
mistakenly
• “predominant service”
– HMRC Guidance concept gone
• Relies on “predominant • Intention, perhaps, more
service” concept important
– But beware!
7. Important Principles
• The guidance must clearly reflect the legislation and legal precedents applying.
• An adviser acts as agent to the client and has a duty to act in the best interest of
the client under normal agency law. This is further reinforced by FSA rules. Since
this is the case, the adviser must ensure that a client is afforded the correct VAT
treatment of his adviser charge. He should not charge VAT just because it may be
easier and makes the business administratively simple. HMRC has no interest in
collecting a tax that is not legally payable.
• The guidance to the industry must be practical and must be subject to a clear test
that can be utilised by both adviser and HMRC in the determination of VAT
treatment.
• The word advice is utilised by other professions and there is a clear rationale for
the VAT treatment of advice being different for financial advisers than for say
accountants, tax professionals and solicitors.
• The VAT treatment of a supply must be capable of being determined up front
before the work is engaged on.
8. Exempt Financial Services
• In general, financial services are exempt from VAT
• Most important exemption is for intermediation
• A financial adviser will be supplying an exempt
intermediary service if (s)he
– brings together a person seeking an exempt financial
service with a provider of an exempt financial service
– stands between the parties and acts in an intermediary
capacity, and
– undertakes work of a specialised nature, preparatory to
the completion of a contract for the provision of financial
services, whether or not it is completed.
9. Regulated activities and the
permissions regime
The Regulated Activities Order (RAO) sets out which activities, in relation to which products are to be regulated.
The FSA packages the activities up into a permission regime and uses the regime in their Part IV authorisation for
firms. The Permissions for the purposes of this guidance can be divided into those that are fundamentally
intertwined with intermediation - i.e. the final link in the chain of bringing those who wish to acquire financial
products and those who wish to provide them, and those which involve some other activity which does not
involve arranging, dealing or otherwise executing acquisition of financial products.
It is the involvement in regulated activity which sets apart the Regulated Financial Adviser from any of the other
professions and the VAT treatment should be fundamentally driven from these permissions.
In order to operate as a Financial Adviser a number of regulatory permissions are required, particularly:
• Advising on Investments
• Arranging Investments
In order to be involved in regulated advice it must involve a personal recommendation. By the very nature of
being involved in regulated advice you are completing the intermediation chain. It is the way that the firm’s
permissions are being used that should form the genesis of the VAT treatment.
What Services does a Financial Adviser offer?:
Even though he/she may develop a financial plan, the object of the financial plan will be to recommend which
product types and which product providers customers are going to use to fulfil their plan.
If the supply depends on the use of advising on investments and arranging investments then it is clear that this is
part of intermediation and it is therefore exempt.
10. Six stages of the adviser’s role
If a financial adviser is providing a service that involves advising on and arranging retail
investment products, then the services are part of intermediation and are exempt from
VAT. In this context, advice covers a broad range of functions including primarily personal
recommendation, referral and intermediary work around product distribution.
1. Gather information about the customer;
2. Carry out research to find suitable investment options;
3. Provide the customer with reports, financial health-checks, forecasts;
4. Recommend specific investment products to the customer, including the prices
at which these can be arranged;
5. Act between the product provider(s) and the customer with a view to arranging
the sale of the Retail Investment Products agreed with the customer;
6. And, where applicable, i.e. where the customer agrees to an ongoing review
service, monitor the customer’s ongoing position to ensure that the products
continue to meet the requirements of the customer.
11. What’s in a name?
Financial Planner?
Wealth Manager?
Portfolio Services?
IFA?
Adviser?
Investment Manager?
12. HMRC Menu of Services
VAT Supply Description VAT liability
Execution only Buying or selling securities on a client’s instructions, but Exempt
without offering advice on the transaction.
Advice General financial or investment advice that is not Taxable
provided as part of a complete service that includes an
exempt financial service.
Intermediation Providing advice and acting between the client and the Exempt
or provider to arrange a contract for the provision of
‘Advised sales’ financial services, whether or not it is completed.
Discretionary (Portfolio) A securities-based asset management service, whereby Taxable
investment management the adviser on his own discretion takes decisions on the
purchase and sale of securities and implements those
decisions by buying and selling the securities, and
without obtaining prior instruction from the client.
13. Concept of the door remaining open to Arranging
In most cases the Adviser will be using both the permissions of Advising and
Arranging and therefore the supply is exempt as this is intermediation. This is also the
case even if the transaction agreed to fails.
Intermediation/Negotiation
Customers
Providers
Seeking
Seeking
Financial
customers
products
Advising on Arranging
Investments
FSA Permissions in use
14. When the door to arranging is closed or closes
• When the service is very clearly only ever involves the advice permission
and the service would never use the Arranging Permission. Examples of
this would be when the service clearly offers to provide a Financial Plan
but there is no requirement to arrange any product. This would not be
exempt. The door was never open.
• Where for some reason the intermediation process cannot be
completed e.g. the adviser decided as part of his advice that he is not
the best person to do the arranging. The door has now closed and the
supply is no longer exempt. The adviser may now set a new piece of
supply which will not be exempt e.g. when he recommends a
discretionary manager. The adviser in this case is now involved in
intermediating a service which is not itself exempt i.e. investment
management– the intermediation chain is broken. In this case the
discretionary manager is taking on the arranging and dealing role.
16. Examples
There are numerous examples in the Professional Direction
The Vat treatment in these examples have been discussed with HMRC
17. The problem area – clients who do
not agree to complete a transaction
The client:
• Says thanks but no thanks
• Dies before a agreeing to go ahead
• Otherwise falls out of the process before
agreeing to the transaction of any product or
financial services
This is not uncommon in other industries – the VAT treatment set at outset can
be changed by the REALITY of what was consumed.
…………………………………………………………………………………………….Ask your printer
18. 3.13 What if my customer pays everything but the VAT?
If your customer refuses to pay the VAT charged, or you did not charge VAT when
the supplies were made but issued supplementary invoices to recover the VAT from
your customer, the claim to relief is limited to the VAT element of the total debt. For
example if you originally charged £100 which your customer paid, and you
unsuccessfully attempt to recover the £17.50 VAT charge originally omitted, you are
only entitled to claim the VAT fraction of £17.50 as bad debt relief.
2010/12: Retail Distribution Review (Adviser Charging) Instrument 2010
per hour We will tell you if you have to pay VAT.” “Lump sum We will confirm what
we will charge you in writing before beginning work … We will tell you if you have to
pay VAT.” “Reviews We will confirm what we will charge you in writing before
beginning work … We will tell you if you have to pay VAT
19. Practical Issues
• A standard form of assessment of the VAT treatment
should be utilised by advisers and kept as part of their
file record
• Advisers should set out in their engagement letter to
clients the VAT treatment of the supply that they are
about to propose to deliver
• Clients should be advised that if they do not agree take
up the recommendations, VAT may be charged
• If the client agrees to take up the recommendations
the service is exempt – even if the product sale is not
finally concluded
20. Other issues
• ACF – not always appropriate
• Broken ISAs
• Pensions
• Platforms/Wraps
• Regular savings vehicles
21. Where are we now?
• Guidance issued by HMRC
• Most of our work will be exempt
• Professional Direction by PFS
• However there are issues – surrounding
people who do not complete a product
transaction – HMRC have taken a position!
22. CONCLUSION
• Achieving the right VAT outcome should be
part of professional excellence.
• Clients who do not agree to a financial
services transaction will have to be invoiced
directly (outside ACF) for the VAT.
• As with all tax treatments - may be subject to
legal challenge
• There will be anomalies to figure out