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Business Advisory Launch Programme · Stage 4 of 10
Set Your Scope & Terms
Know exactly where your unregulated service stops, whether you trip an AML trigger, and how your terms protect you.
How long
~1 day
You’ll have
A perimeter map, an AML self-check, terms, and a referral bench
Steps
4 steps
Resources
2 resources
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01 Step 01
Step 01
Map your perimeter: where you must refer out
Four regulated fields border your work, and straying over a line can be a criminal offence that voids your protection.
Do it yourself
- Financial advice: do not recommend specific investments/products, arrange them, or make a financial promotion unless FCA-authorised. Refer to an FCA adviser or broker.
- Insolvency: only a licensed Insolvency Practitioner may advise on and take formal insolvency procedures. Refer at that point.
- Reserved legal activities: six activities (including conducting litigation) are reserved to authorised people. Refer contracts, disputes and anything reserved to a solicitor.
- Tax: do not file returns or give specific tax planning advice unless qualified. Refer to an accountant or tax adviser.
Common mistake · Drifting across the FCA line by telling an owner which product to choose, or introducing investors, thinking it is "just advice".
Time~2–3 hours to internalise CostFree DifficultyHardResource for this step
CHECKLISTThe referral line map
If the conversation reaches one of these lines, stop and refer. A signpost, not legal advice.
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02 Step 02
Step 02
Check whether you need AML supervision
Some advisory-adjacent work drags you into mandatory anti-money-laundering supervision, and trading unregistered can be an offence.
Do it yourself
- Check the TCSP trigger: forming companies, or providing a registered office, nominee director or secretary, may make you a Trust or Company Service Provider needing HMRC AML supervision.
- Check the tax trigger: giving tax advice by way of business brings AML supervision, plus a new HMRC registration for tax advisers dealing with HMRC from 2026.
- Apply the "by way of business" test: continuity, profit, and how you advertise.
- If in scope, register before you start that activity and expect a fit-and-proper check. Confirm on GOV.UK.
Common mistake · Offering to "sort the company formation and registered office too", not realising it makes you a TCSP with AML duties.
Time~1 hour to self-assess CostFree to check; HMRC fees if in scope DifficultyMedium -
03 Step 03
Step 03
Build your engagement terms and cap your liability
A clear engagement letter defines scope and, through a liability cap, is your main financial firewall alongside insurance.
Do it yourself
- Adopt standard terms: scope, out-of-scope, fees, payment, IP, confidentiality (Module 3), termination.
- Add a limitation-of-liability clause, commonly capped at the fees paid, excluding indirect loss.
- Never try to exclude liability for fraud, or for death or personal injury by negligence: you cannot.
- Add a boundary line: no regulated financial, insolvency, legal or tax advice, with a referral where needed.
- Get every engagement signed before work starts, and have a solicitor review the template once.
Common mistake · Starting on a one-line email with no liability cap and no scope boundary, so an uncapped claim lands entirely on you.
Time~half a day to build the template Cost£0 using a template; £200–£500 for a solicitor review (rough) DifficultyMediumResource for this step
CHECKLISTEngagement terms checklist
The clauses an advisory engagement letter needs. A template to adapt, not legal advice.
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04 Step 04
Step 04
Build your referral bench
"Refer out" only works if you already have the person to refer to, and a good bench flows both ways.
Do it yourself
- Line up a named contact for each perimeter: an FCA adviser, a licensed IP, a solicitor, and an accountant/tax adviser.
- Agree how referrals work between you, any fee arrangement, and how you stay in the loop.
- Keep the bench visible so you refer the instant a line is reached, not after.
- Position it to clients as a benefit: you bring a vetted team around them.
Common mistake · Reaching a regulated line with nobody to hand the client to, so you either freeze or drift over the line.
TimeOngoing, ~2–3 hours to seed CostFree DifficultyEasy
What you’ll have after this stage
- A clear map of the four regulated lines you must not cross
- An answer on whether you need AML supervision
- Engagement terms with a liability cap and a scope boundary
- A named referral contact for each perimeter