What’s it all about?
28 April 2014
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Traditionally, one of the perks of life in a private client department is that you are unlikely to spend as many hours in the office as corporate colleagues and you are able to maintain a good work-life balance.
While this is true to an extent, servicing global clients often means meeting deadlines in different jurisdictions with different timezones. In particular, if you find yourself working on a large offshore trust restructuring (involving, say, the British Virgin Islands, Hong Kong and the UK) you will find that it is very similar to a corporate transaction in terms of both the excitement generated and the hours worked.
It is likely that even at the most junior levels you will have the opportunity to take on a lot of responsibility for the day-to-day running of a number of matters. You will end up establishing what are hopefully long-term relationships with clients and other advisers (such as accountants and investment managers) and you will often become the first port of call for a number of concerns.
A typical trainee’s day might involve a telephone call to a Bermudian lawyer about documents being prepared for an offshore restructuring, the drafting of a will and letter of wishes for a client, preparing the first draft of a taxation paper on the consequences of a particular transaction for an individual, and an obscure piece of research thrown up by a longstanding client. You will find that no two days are ever really the same.
The most important requisite for a private client lawyer is confidentiality, as it is of the utmost importance that a client’s affairs are kept private. You may end up working for some household names, but you are not allowed to tell your friends about it later. You will also need to have good attention to detail and excellent drafting skills.
As a private client lawyer you will find yourself working with a number of different people, be they the client, other professionals or even lawyers from other departments in your firm, and so good communication skills and an ability to get on with people are also very important.
Finally, the nature of much of the work means that private client work is often more technical than other areas of law.
In March 2006 the Government announced a radical overhaul of the taxation of trusts and the ramifications of this are still being discussed and argued about more than three years later. These changes have meant private client solicitors are having to reassess the types of structures that are suitable for clients’ needs and also come up with new structures that provide both tax efficiency and asset protection under the new legislation.
Changes introduced in October 2007 concerning the so-called ‘non-doms’ received a great deal of media coverage. These relate to the way in which people who are resident but not domiciled in the UK are taxed.
The changes introduced were politically driven and not initially very well thought out and so prompted opposition (at the forefront of which were a number of private client practitioners). This in turn led to a number of amendments being made to the legislation. However, while these amendments were debated, a lot of work had to be done on behalf of clients who wanted to reorganise their affairs while the legislation was not complete (indeed, it is still not in final form at the time of writing, despite having come into force on 6 April this year). It was crucial for all lawyers working in this area during this period to be flexible and quick to adapt and also to keep abreast of some very complicated, yet constantly shifting, legislation.
The Government continues to make numerous amendments to tax and trust legislation and even as recently as April 2009 it has announced an increase in the rate of income tax for high-earning individuals and trusts from 6 April 2010. This, coupled with the much lower rate of capital gains tax (18 per cent), has led a number of clients to consider how to amend their existing structures to avoid this additional tax charge.
What’s it all about?
A private client solicitor advises individuals and families in respect of all aspects of their personal estate planning. The range of work is extremely broad and often involves advising on the use of a myriad of alternative structures and documents to achieve the client’s succession and tax planning objectives. These options range in complexity from straightforward wills to global trust structures and establishing private trust companies, depending on the client’s individual circumstances.
Such clients are often high-net-worth individuals or families who can be based anywhere. Given the increased globalisation of the clients, it is becoming more usual for the client’s requirements to involve establishing structures and drafting documents in a number of jurisdictions. Clients are also becoming more concerned by non-financial motivations such as asset protection in the event of divorce.
One of the most interesting aspects of the work is the input you have on a family’s global strategy; it is far more than merely advising on tax (although this plays a major part), but instead also involves getting to know the individuals concerned and their particular motives and goals. Any estate planning needs to incorporate flexibility to accommodate changes in the client’s circumstances and it is not uncommon for a client to change or adapt their structures many times during their lifetime.
Mark Pearce is a solicitor at Withersk