high net worth individuals Archives

Investors, fundraisers and investee companies who rely on the certain investor exemptions need to be aware of changes to the rules governing the promotion of financial investments. On 31st January the new rules change those who qualify as “high net worth individuals” or “self certified sophisticated investors” and to whom financial promotion information can be sent without having to jump through as many regulatory hurdles.

	Before 31 January 2024	After 31 January 2024
High Net Worth	a net income of at least £1000,000 in the last financial year; or net assets of at lest £250,000 throughout the last financial year	a net income of at least £170,000 in the last financial year; or net assets of at least £430,000 throughout the last financial year.
Self-certified sophisticated investors	made more than one investment in an unlisted company in the previous two years; worked in a professional capacity in the private equity sector, or in the provision of finance for small and medium enterprises, in the last two years; been the director of a company with an annual turnover of at least £1million in the last two years; or been a member of a network or syndicate of business angels for more than six months and are still a member	worked in a professional capacity in the private equity sector, or in the provision of finance for small and medium enterprises, in the last two years; been the director of a company with an annual turnover of at least £1.6million in the last two years; or been a member of a network or syndicate of business angels for more than six months and are still a member.

The method for calculating income and assets remains unchanged after the implementation date.

In addition there are some minor additional requirements which mean that all communications making use of these exemptions should include further details of the Company address, contact information and company registration number , should no longer refer to the word “certified” from the high net worth individual exemption and provide updates to statements from time to time.

Failure to comply with the new rules is a criminal offence with a possible custodial sentence of 2 years and could render any commission or fees earned by investment professionals void – plus fines from the Financial Conduct Authority.

If you would like to talk to someone regarding these changes please contact Amanda Brockwell.

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