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CISI PCIAM study materials
CISI PCIAM study resources

CISI PCIAM: Financial Planning and Regulation

CISI PCIAM · Work through your exam, one topic at a time.

All guide sections

Financial Planning and Regulation

What the exam tests

This domain tests the regulatory framework around advice and the financial-planning context in which investments sit: FCA rules, client assets, complaints and compensation, financial crime, pensions, protection and estate planning. Answers need the rule and its practical consequence.

Core rules and concepts

  • FCA framework: Principles for Businesses, COBS conduct rules, CASS client-money rules, SM&CR accountability and the Consumer Duty outcomes. PROD requires products to be designed and distributed for identified target markets.
  • Complaints and compensation: acknowledge promptly, give a final response within eight weeks, and tell the client about the Financial Ombudsman Service (usually within six months of the final response). FSCS protects eligible claimants up to £85,000 per person per firm for investments and deposits.
  • Financial crime and data: MLR checks, source of funds, suspicious activity reporting, GDPR/DPA 2018.
  • Financial planning: cash-flow and emergency reserves, protection, retirement funding, and IHT. IHT has a £325,000 nil-rate band, a £175,000 residence nil-rate band (tapered above £2m), spouse exemption and a 40% rate, reduced to 36% where at least 10% of the net estate goes to charity.
  • Pensions: tax relief, annual allowance (£60,000 standard; tapering for high earners), MPAA £10,000, and access rules.

Worked example

A single client dies with an estate of £1.2m, including a £500,000 home left to her children. No spouse exemption applies. NRB £325,000 + RNRB £175,000 = £500,000. Taxable estate = £1.2m − £500,000 = £700,000. IHT at 40% = £280,000. If the estate had exceeded £2m, the RNRB would taper by £1 for every £2 above £2m, so the relief would be reduced or lost.

Traps that cost marks

Assuming FSCS compensation is unlimited; missing the eight-week complaint deadline; confusing FOS and FSCS roles; treating Consumer Duty as a disclosure exercise; forgetting RNRB taper; ignoring pension annual-allowance tapering; giving tax planning without confirming the client's domicile and will position.