STEP England & Wales Biannual Statement – June 2014

Patricia WassOver the last six months, the England and Wales Regional Committee has been involved in some significant changes to policy, education and business planning initiatives. These adjustments have presented both challenges and opportunities and have been received with enthusiasm by our members.

The Committee spent time at the beginning of the year providing input to the launch of the Code for Will Preparation in England and Wales in January, discussing feedback from members after the Code was launched and providing some minor revisions in March. At present the Code only applies to members in England and Wales, with the understanding that other regions such as Canada, Northern Ireland and Australia have also expressed interest in adopting similar measures. The Committee agreed that the Code should be applied across the Society within the scope of respective jurisdictions’ legal frameworks. There will be a six-month review of the Code to assess how it is working in practice, with the expectation that it will be reviewed annually thereafter and revised if required. The Professional Standards Committee will be responsible for future amendments to the Code and its application in other jurisdictions; however the England and Wales Committee will still play a role in this process.

The Committee were pleased to see how well this year’s series of Spring conferences have been received. Delegate numbers for the events have been high with the content both topical and relevant. Wherever I have bumped into STEP members from my own branch over these past weeks, they have all commented on how good the conferences have been — many saying it was one of the best that they have attended.

The UK Practice Committee have been working to finalise the STEP Standard Provisions toolkit. They are now working in conjunction with the Mental Capacity Special Interest Group on a project of testamentary capacity, which will be rolled out in the near future. Meanwhile, the UK Technical Committee has been working on guidance for preventing tax avoidance with charities. Representatives from the Committee recently met with the Office of Taxation to discuss the simplification of trust taxation.

George Hodgson and the STEP Policy Team have continued to provide support on FATCA and have published provisional guidance in cooperation with the ICAEW and The Law Society. FATCA registration commenced on 1 January this year with registrations for the first list of financial institutions completed in early May. A final list will be completed in October this year with penalties applying to financial institutions deemed non-compliant from January 2015.

The Policy Team have also been working on FATF Anti-Money-Laundering regulations and will be doing further work in Europe regarding the establishment of registers for companies and trusts.

STEP is officially launching a new Qualifications Framework in July 2014, which will come into effect in England and Wales in April 2015. This was discussed and debated in detail at the recent Committee meeting on 5 June. Members and students will receive communication from STEP in due course to ensure that everyone is aware of, and understands, the changes.

Other discussions of importance have been around the STEP 2021 Business Plan. One of the main objectives of the plan is to work towards a goal where STEP has an offering for everyone, regardless of what stage they are at in their career. Another objective is to continue to work on STEP’s representation so that the general public understands who we are. We expect that, in order to achieve these goals, STEP will aim to gain wider access to a wider range of university courses and will start working with new educational partners.

At the June Committee meeting we discussed engaging STEP Excellence Awards winners to help us form a focus group that can assist in encouraging the next generation of practitioners to engage with and commit to STEP. It is vitally important for the future of STEP that we have younger members becoming involved in the Society.

At present, STEP England and Wales runs eight major technical conferences in the Spring and Autumn in addition to an Annual Branch Chairs’ meeting and hundreds of branch events. Arguably, until now, there has not been a flagship event for England and Wales members as a whole. With this in mind, a sub-committee will explore the possibility of a two-day National Conference in June/July 2015, which may incorporate the Branch Chairs’ Assembly. There will be more to report on this proposal in the months to come.

Finally, STEP will continue to further develop certificates that will be of relevance to members. The new Advanced Certificate in Advising Vulnerable Clients will commence in October this year. We do not believe that there is any other such qualification anywhere else in the market and we hope that this will be of interest to a number of our members working with vulnerable clients.


Patricia Wass TEP is Chair of STEP’s England & Wales Regional Committee

If it’s too good to be true, it’s probably just spam

James HarrisLast week several STEP members reported receiving suspicious and unsolicited emails from an individual purporting to work in international taxation. What made the spam email particularly unusual was the attention to detail the sender had paid to make it look like legitimate correspondence and the citation of STEP to add credibility to its content. It seems timely to look at junk and spam email and what you should when encountering emails that don’t feel above-board.

Dealing with spam and junk email

 We’ve all have to deal with unwanted emails, both at home and at work, but as hacking and malware approaches become increasingly sophisticated it’s more important than ever that we understand the risks. Most employers and big email providers (such as Google and Microsoft) are continuously striving to protect us from unsolicited emails, but there are — and always will be — some that slip through the net. So how should we be dealing with spam and junk email that does get through? Firstly, I would recommend that any computer connecting to the internet has antivirus and malware protection installed and, most importantly, it should be up to date. I regularly come across users who bought antivirus software several years ago and didn’t pay to renew it, meaning it’s ineffective as it’s not receiving the latest definitions of what to scan for.

Having ensured your antivirus and malware protection software is up to date, there is a general set of guidelines you can follow to stay safe when reviewing your email, which will vary depending on the type of email you are looking at:

Spam email:

 Spam is totally unsolicited mail and it can take various forms from a scam email trying to convince you to transfer money to a seemingly worthy cause, right through to a seemingly random image or string of nonsensical letters. The first, and most simple, step in approaching this type of email is, if you don’t recognise the sender of the email and it’s not something you’re expecting then delete it without opening it. If you are unsure as to whether the email is legitimate (the email received by STEP members last week is a good example of the lengths spammers go to look authentic) then you will need to open it in order to review it further. The second step to ensure you stay safe is not to click any links in the email unless you are confident that they are trustworthy. If the email in question is from a bank or anywhere that requires you to log in using sensitive information, don’t follow the link in the email; use a browser to go directly to the site to log in instead. This approach guarantees that you are on the site you expect to be on when you are submitting personal details.

There are always expectations to these rules and if you are ever in any doubt I would always recommend deleting the message. If it is important and someone is waiting for a response from you, you’re always better off proceeding with caution, protecting yourself and getting back to them later.stock-photo-computer-security-concept-present-by-magnifying-glass-focus-on-the-red-spam-text-in-binary-code-114574033

Junk email:

Junk will generally be email we receive from an opt-in service such as an online retailer’s marketing email. This kind of mail is annoying but is harmless and should be deleted, ignored or unsubscribed. If you plan to unsubscribe I recommend you don’t click the unsubscribe link in the email. Rather go to the site yourself in a browser and unsubscribe from there. If you do click on an unsubscribe link on spam email masquerading as junk, you may actually be redirected to a site designed to capture your details. If you receive an email that looks like junk but you have no recollection of subscribing for it then you should treat it as spam.

If you encounter any suspicious emails alleging links to STEP please let me know.

James Harris is STEP’s Information Technology Manager. He has previously written about the Heartbleed bug and measures STEP Members can take to protect themselves online.

Unsolicited e-mail offering

David HarveyTo all Members,

STEP has been alerted to an individual who is contacting STEP members unsolicited by e-mail offering services in connection with reclaiming Swiss banking fees. STEP in no way endorses this service and would advise members to treat all such unsolicited offers with extreme caution. STEP is also urgently investigating if there has been any misuse of STEP’s data.

David Harvey

‘Moving Money’ – the cost of more onerous AML procedures

George Hodgson

George Hodgson

I attended a lively presentation today on the paper Moving Money: International Flows, Taxes, and Money Laundering by Professors Richard Gordon and Andrew P. Morris. They basically argue that the move to more onerous anti-money laundering (AML) procedures and the move to automatic information exchange are both going to significantly increase transaction costs for everyone, legitimate and illegitimate users of the financial system alike. This increase could have significant implications for economic growth, but with little evidence of any real benefit from the new measures in terms of improved tax revenues or reduced illegitimate funds flows. In spite of that, there was a general air of optimism about the outlook for international finance centres (IFC). The professors noted that the best IFCs already have very effective systems and skill sets in these areas. They may well be able to adapt to the new regimes more rapidly and with fewer costs than their on-shore counterparts — who also face huge compliance costs — hence preserving their competitive advantage. Indeed the rising cost of on-shore, rather than off-shore, compliance may well start to become a political issue in the major economies now pushing through such dramatic, and expensive, changes in tax reporting and the AML regulatory environment

We understand that the UK has decided not to adopt the proposed delay to the on-boarding of new entity accounts announced by the US in notice IRS notice 2014-33. Instead UK Financtaxh_2023675cial Institutions will be required to obtain self-certifications from new customers (both entities and individuals) from 1 July 2014. This will maintain consistency between Entity and Individual on-boarding processes, as well as between the due diligence obligations for US and CD/OT reporting purposes.

George Hodgson is STEP’s Deputy Chief Executive.  

Social media matters: finding quality CPD online


When we think of continuing professional development (CPD) often the first things to come to mind are attending lectures or taking formal qualifications. Professionals rarely consider the many small exchanges of information that occur between peers in an office or in coffee breaks, let alone online discussions, as building towards their CPD requirement.

Social media has now been around long enough that professional bodies can see patterns and adapt their concept of how members accrue CPD accordingly. For example, a 2012 study of online learning suggests that the likes of Twitter and LinkedIn are now leading means of collecting CPD.

Social media has permeated our daily working lives, resulting in ‘micro-engagements’ between colleagues and peers. A quick series of posts on LinkedIn may be just as fruitful as spending hours searching a library, because you can speak directly to other practitioners and cut out the inexpert middleman of search engines. I’m sure that most of us have given up on Googling ‘estates’ or ‘trusts’ by now, for that reason!

A more liberal approach to CPD opens up a new way for professionals to boost their understanding, but also adds a new challenge — determining how to record and evaluate social media and online interactions as quality CPD.

The first hurdle in accepting social media interactions as CPD is recording any learning activities. Recording and reflecting on CPD are an important component of the learning process, so quick interactions without assessment are less valuable. Some would say that monitoring use of online forums is a rigorous way to track the volume and value, but it would be labour-intensive for all parties and dissuade professionals from using genuinely useful sources of information. Since it’s unrealistic to expect members to record every activity on various sites, it can be treated in the same way that reading trade publications was in the past; the content may not be relevant to everyone, but reading is worthwhile to find the information that is relevant.

The next question is how to determine the value of CPD gained through online discussions, since they’re usually brief and informal. The fact that discussions are public is a safeguard because, unlike static articles, ideas can be openly challenged and alternative suggestions can be discussed. STEP’s experience is that the most active members tend to share articles from respected sources, because their reputations are reinforced by the quality of the information shared. Online discussions are similar to the conversations you might have at a conference, so are of equal value for CPD purposes.

Reviewing the impact of changes in legislation or learning from a complicated case is best done after the dust has settled and experienced professionals have drawn conclusions from it, so there will always be a place for traditional learning from experts in formal settings, whether through gaining qualifications or attending conferences. The main benefit of social media is that members can immediately share details of something that’s impacting practitioners today, rather than becoming tomorrow’s conference topic themselves.

Click here for more information on STEP’s new CPD policy

Val Cox is STEP’s CPD Manager.

STEP News Digest wrap-up – May’s top stories


Too busy to read the news in full? Welcome to the wrap-up of the top ten most popular stories in the STEP online Digests throughout May. In case you missed them, here are the top STEP News Digest stories most clicked by our readers.

IRS clarifies trust registration procedure: The US tax authorities have definitively set out the procedure by which trustees worldwide can certify a trust as exempt from the US Foreign Account Tax Compliance Act. The procedure is required whether or not the trust has any American connections.

Regulator aims to improve solicitors’ wills: The Solicitors Regulation Authority has published new guidance on the drafting of wills. It reflects the results of a 2011 research project that found high street solicitors were just as likely to produce poor quality wills as were unqualified will-writers.

Deputies deposed for ‘looting’ are refused a share of P’s estate: Two women who had their deputyships of 94-year-old Gladys Meek revoked for spending much of her GBP500,000 estate on themselves and their families have asked the Court of Protection to execute a statutory will leaving them some of her remaining assets. However the court refused, and moreover not only called in the former deputies’ GBP275,000 security bond in full but also named them publicly.

Drafting a pre-nup carries high risk for practitioners: Practitioners working in the relatively new field of marital property agreements could be exposed to massive professional negligence claims if they recommend pre-nups or post-nups that later go wrong, say two experts. One leading silk in the field simply refuses to advise on them.

Mountain goes on sale to pay IHT bill: Lord Lonsdale’s decision to sell Saddleback Fell in the Lake District, to help pay inheritance tax liabilities on his late father’s estate, has attracted much attention. Lord Lonsdale died in 2006, leaving the title and estate to his eldest son Hugh Lowther, but with an IHT liability of GBP9 million. His death also triggered lengthy litigation between the new earl and the trustees of the Lonsdale family trusts, concerning deeds allegedly signed by the seventh earl on his deathbed.

Government drops plan to extend 1975 Act jurisdiction: The government has agreed to remove a controversial measure of the Inheritance and Trustees’ Powers Bill that would have allowed reasonable provision claims to be brought against the estates of persons domiciled outside England and Wales.

Fixed-fee billing is now the norm in will-writing: Less than 10 per cent of all legal work for ordinary consumers is now billed by the hour, according to new research from the Legal Services Consumer Panel.

Inheritance and Trustees’ Powers Bill enacted: The Inheritance and Trustees’ Powers Bill has received royal assent and will come into force on 1 October 2014. It simplifies the intestacy rules for England and Wales, in particular abolishing the spousal life interest trust. It also amends the Inheritance (Provision for Family and Dependants) Act 1975 and the powers for trustees to apply income and capital under the Trustee Act 1925.

Applying for a grant when named executor is incapacitated: If the first-in-line executor nominated in a will is losing mental capacity, can the second-in-line apply for probate just by reciting the first’s incapacity in the oath, or is supporting evidence and the involvement of the Court of Protection required? Practitioners discuss.

Second Icebreaker LLP scheme loses at tribunal: Last week’s tribunal victory for HM Revenue & Customs in the Icebreaker tax planning case has attracted much media attention because some participants were former members of a popular boy band.

The STEP Industry News Digests provide a round-up of relevant industry news for trust and estate practitioners and other professionals in the wealth management sector. They provide brief summaries of topical news stories gathered from news providers internationally, providing a quick reference for busy practitioners to all the relevant news and issues. The News Digests also feature job listings from our recruitment site and list local STEP branch events and conferences. STEP’s digest services include twice weekly UK and Wealth Structuring (international) editions as well as a bi-weekly North America Digest focusing on the US, Canada and Mexico, and a Latin America Digest.

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