It has been
brought to my attention recently that there has been a sudden increase in the
number of financial advisers looking to provide advice to expats in Italy, and a number of you have been telling me that
you have been solicited with unwanted phone calls.
So here are some words of caution!
International
advice firms that advise expats in various countries around the world are not
new. We have been around for a long
time. In The Spectrum IFA groups case, 10
years. Even longer if you take into account the experience of some of the
advisers in the group. However, there
has been one important development in this field in the last 5 – 10 years, in
Europe and that is regulation. The EU
have regulated this area of financial advice a lot more.
The outcome
of this is whereas International financial advisory groups might have once
offered a raft of offshore products to everyone, no matter where they live,
each and every product must now be tailored to meet the individual requirements
of the country in which the client is living, in this case Italy. An offshore product is often NOT suitable as
they are blacklisted for Italian tax purposes (although they can be suitable in
some cases) and detrimental tax treatment will apply. (I will write more about
this on another blog post).
Thank fully
most groups now offer the right products for the respective country in which the
client lives but there are still some risks in working with groups and more
importantly individuals who do not have the
correct tax status in Italy.
Firstly,
you need to ensure that the group with whom you are working is correctly
regulated in Italy. They should be
registered either with ISVAP or the CONSOB, and/or have ‘passports’ from
another European country to do business in Italy. Thankfully most do and so this is the least
concerning area.
My biggest
concern is that of the advisers themselves.
Quite often advisers will live and work in Italy but without actually
becoming resident here and without submitting tax declarations. This is worrying. Should you do business with these people and
they are subsequently investigated by the Guardia di Finanza then I can see no
other option than them leaving the country and leaving you high and dry.
At the
Spectrum IFA Group it is important for us to understand exactly what our
clients are going through and so we are all required to be resident in the
countries in which we work, which means tax declarations.
As more and
more groups decide to come to Italy and work with expats, expat financial advisers will come under more and more scrutiny to ensure
that we have our own personal tax affairs in order. If not then it is problematic for the adviser
but even more so for the client who is left wondering why their adviser cannot return to Italy.
I am all
for good healthy competition that drives standards up and creates innovation in
the market, but bad practice does not bode well for the reputation of a financial
profession which has had its fair share of scandal in recent times.
My advice
is always to ask the question to whom you are working with: Are you resident and paying tax in Italy?, ask
to see their carta d’identita, and ask for evidence of F24 if required (to
evidence that they pay their taxes). Don’t
forget evidence of registration in Italy and do enough research in advance.
The Spectrum IFA group has a branch in Italy and is fully registered with ISVAP and the Camera di Commercio. (P.Iva 12418981002)
If you
think that you might be in this situation or are concerned about it and would
like some advice from the Spectrum IFA group then you can contact me
on gareth.horsfall@spectrum-ifa.com or call me on +39 3336492356
