Transact SIPP, ISA or GIA as a Non-UK Resident: Why You May Be at Risk and What to Do Next

What Is Transact and Who Uses It?

Transact, operated by Integrated Financial Arrangements Ltd, is one of the UK's largest retail investment platforms. It is widely used by UK-based financial advisers to hold client assets across SIPPs, ISAs, GIAs, and offshore bonds.

Many clients opened their Transact accounts while living in the UK and subsequently moved abroad, to the EU, the United States, Australia, the UAE, Singapore, or elsewhere. Others were advised into Transact arrangements while already living overseas. In either case, if you are now a non-UK resident, your Transact account is potentially creating compliance problems you may not yet be aware of.

The Core Problem: Transact Only Works With FCA-Regulated Advisers

This is the root issue for most non-UK residents with a Transact SIPP, ISA, or GIA.

Transact is a platform; it does not give advice directly. It operates exclusively through FCA-regulated financial advisers. But FCA-regulated advisers are generally not permitted to provide financial advice, especially ongoing financial advice, to clients who are resident outside the United Kingdom.

Regulation for financial advice is determined by the client's country of residence, not the location of the assets being advised on. This means an FCA adviser cannot lawfully advise a client living in France, Germany, Australia, Canada, or the United States unless they hold the relevant regulatory permissions in that country.

There are narrow exceptions. In some jurisdictions, brief or incidental engagement may be permissible. But ongoing investment advice and portfolio management for residents of another country rarely qualify under these exemptions.

The practical consequence: if you live outside the UK and your Transact account is being actively managed by a UK-only, FCA-regulated adviser, there is a serious question about whether that advice is being provided lawfully. Your adviser may genuinely want to help, but may not be authorised to do so under the rules of the country you now live in.

Transact Does Not Meet EU or US Regulatory Requirements

Beyond the adviser authorisation issue, many consider that the Transact platform itself does not comply with the regulatory requirements of the European Union or the United States of America.

EU Residents and MiFID II

MiFID II imposes specific requirements on how investment services are provided to EU retail clients. Non-EU platforms without MiFID II authorisation or an appropriate passporting arrangement cannot lawfully provide ongoing investment services to EU-resident individuals. Transact does not hold MiFID II authorisation and has no place of business in the EU, meaning EU-resident clients using the platform are in a regulatory grey zone with potentially limited consumer protection recourse.

US Residents and US-Connected Persons

For US residents and US-connected persons, including US citizens living anywhere in the world, green card holders, and those with substantial US tax presence, the issues are even more acute. The US has some of the most far-reaching extraterritorial financial regulations globally.

Platforms and advisers serving US clients are generally required to register with the Securities and Exchange Commission (SEC) or a relevant state regulator as a Broker-Dealer and/or Investment Adviser. Transact is not SEC-registered, and most FCA-only advisers are not either. This creates a compliance gap for the adviser and significant potential liability for the client.

The PFIC Problem: Transact's 2025 Restrictions for US-Connected Clients

In late 2025, Transact began notifying US citizens, green card holders, and FATCA-reportable taxpayers that they can no longer hold collective investments, including OEICs, unit trusts, and ETFs domiciled outside the United States, within their GIA, ISA, or offshore bond.

The reason is PFIC (Passive Foreign Investment Company) exposure. Under US tax law, most non-US funds and ETFs are classified as PFICs. For US taxpayers, PFICs are subject to some of the most punitive provisions in the entire US tax code:

• Gains and income can be taxed at the highest marginal US rate, even on unrealised positions
• Each PFIC holding must be individually reported to the IRS on Form 8621 every year
• Deferred gains can attract retroactive interest penalties backdated to the original purchase date

Transact, like AJ Bell, Hargreaves Lansdown, and Interactive Investor before it (all of which introduced similar restrictions years earlier), has concluded that managing PFIC complexity is beyond its operational scope. The platform has therefore chosen to restrict US-connected investors from holding collective funds rather than build the infrastructure to identify, report, and manage PFIC obligations.

What this means in practice: US-connected clients holding OEICs, unit trusts, or EU-domiciled ETFs inside a Transact GIA or ISA must now sell those holdings. Cash, direct equities, and fixed-term deposits remain permissible, but the diversified, fund-based portfolios that most investors rely on are no longer available in these wrappers.

⚠️  Important: Selling your funds now does not erase past PFIC obligations. If you have held non-US collective investments in a Transact GIA or ISA while being a US taxpayer, you may already have historic IRS reporting obligations and potential penalties. This is an active compliance issue, not a theoretical one.

Why This Matters Even If You Are Not a US Person

The PFIC issue has drawn attention primarily because of its impact on US-connected investors, but the broader regulatory problem affects non-UK residents of every nationality.

If you are a UK expat living in Australia, Canada, the UAE, Singapore, Hong Kong, or elsewhere, you face a version of the same core challenge: your Transact account is held on a UK platform, advised by an FCA-regulated adviser, under a framework designed for UK residents. The protections, reporting obligations, and tax treatment of your investments under your country of residence may not align with how Transact and your adviser are currently managing your account.

In many cases, clients in this position are effectively unadvised; their FCA adviser cannot lawfully service them, Transact has no obligation to flag this, and the client is unaware that anything is wrong until a tax event, a regulatory audit, or a platform restriction like the PFIC ban brings the issue to light.

What Are the Alternatives? Transfer Options for Non-UK Residents

The appropriate course of action depends on your specific circumstances, your country of residence, tax status, the type of account, and your long-term goals. Here is a summary by situation:

US-Connected Investors

The most important immediate step is to address historic PFIC exposure with a US-qualified cross-border CPA, then move to a platform and adviser arrangement that is dual-regulated under both the FCA and the SEC. Only a small number of firms globally hold both registrations.

EU Residents

The priority is to establish whether your current arrangements have MiFID II coverage, and to consider whether a compliant offshore structure or a platform with appropriate EU market access better serves your needs.

Residents of Other Jurisdictions (Australia, UAE, Singapore, Canada, etc.)

The right solution will vary, but the starting point is always the same: ensuring the person advising you is actually authorised to do so in the country where you live.

Transact SIPP: QROPS or Alternative UK Pension Structures

For a Transact SIPP specifically, a transfer to a QROPS (Qualifying Recognised Overseas Pension Scheme) or an alternative UK pension structure with an appropriately regulated adviser may be worth considering, depending on your situation. Not every non-UK resident needs to transfer out of a UK pension, but every non-UK resident does need their pension to be advised and managed by someone with the proper authorisation to do so in their country of residence.

How Cameron James Can Help

Cameron James is one of a small number of firms in the world with both FCA and SEC authorised advisers, making it one of the very few advisers able to lawfully service UK expats, US-connected investors, and internationally mobile clients across multiple jurisdictions.

Cameron James can help you:

• Review your existing Transact SIPP, ISA, or GIA and identify any regulatory or tax compliance gaps
• Advise on PFIC exposure and coordinate with US-qualified CPAs to address historic IRS reporting obligations
• Design PFIC-compliant investment portfolios using instruments that work under both MiFID II and SEC frameworks
• Transfer existing Transact accounts to suitable, compliant platforms
• Provide ongoing financial advice under the correct regulatory permissions for your country of residence

Most clients affected by these issues were not intentionally mis-sold. The problem is typically that their non-cross-border adviser was not trained or authorised to navigate this complexity. The solution is to correct the course with the right structure and properly regulated advice.

Key Questions to Ask Yourself

If you are a non-UK resident with a Transact account, consider the following questions:

• Is your current financial adviser authorised to advise clients resident in your country?
• Has your adviser reviewed your holdings for PFIC classification if you are a US taxpayer?
• Are you receiving ongoing advice, or has your adviser quietly stopped engaging because they cannot lawfully do so?
• Does your platform meet the regulatory requirements of your country of residence?
• Do you have a clear picture of your tax obligations in your country of residence in relation to your UK investments?

If you are uncertain about any of these, it is worth getting a second opinion from an adviser with the cross-border credentials to give you a complete picture.

Frequently Asked Questions

Can I keep my Transact SIPP if I live abroad?

You can legally hold a Transact SIPP as a non-UK resident, but the key issue is whether you can be lawfully advised on it. FCA-regulated advisers generally cannot provide ongoing advice to clients living outside the UK without the relevant regulatory permissions in their country of residence. This means your SIPP may be unadvised, even if you believe you have an active adviser relationship.

Why is Transact restricting US clients from holding funds?

Transact notified US-connected clients in late 2025 that they can no longer hold collective investments such as OEICs, unit trusts, and non-US ETFs in their GIA, ISA, or offshore bonds. This is due to PFIC (Passive Foreign Investment Company) rules under US tax law, which impose complex reporting requirements and potentially punitive tax treatment on non-US fund holdings. Transact has followed the same path as AJ Bell, Hargreaves Lansdown, and Interactive Investor, which introduced similar restrictions previously.

What is PFIC, and why does it matter for my Transact account?

PFIC stands for Passive Foreign Investment Company. Most non-US mutual funds, OEICs, unit trusts, and ETFs are classified as PFICs under US tax law. US taxpayers who hold PFICs face annual IRS reporting on Form 8621 and potentially punitive tax rates on gains, even on unrealised positions. If you are a US person and have held non-US funds in a Transact account, you may already have historic reporting obligations.

Is Cameron James regulated to advise non-UK residents?

In many jurisdictions, yes. Cameron James has advisers who hold both FCA (Financial Conduct Authority), EEU (CySec), and SEC (Securities and Exchange Commission) authorisation, making it one of the very few advisory firms in the world that can lawfully advise UK expats, US-connected investors, and internationally mobile clients across multiple jurisdictions.