The Lang Cat insight director Steve Nelson
Financial advisers have cited capital gains tax (CGT), cash management, reporting noise and control as recurring model portfolio service (MPS) on platform pain points, research has showed.
Morningstar Wealth, in collaboration with The Lang Cat, has published new research - Unlocking the next phase of MPS growth - which explored how effectively platforms and MPS work together.
The research consisted of a quantitative survey of 182 advisers, followed by in-depth interviews with 12 practitioners. The survey ran from January to early February 2026, with interviews taking place throughout February.
Respondents included in the research cited cost perceptions (39%) and tax complexity (37%) as the primary constraints.
"MPS and platform are experienced as a single system," the report highlighted. "When delivery works well, it's largely invisible. When it doesn't, friction accumulates operationally, not strategically."
Advisers cited cash management, reporting noise and control as recurring pain points. Due to this, the research noted that many firms still rely on manual workarounds to maintain scale and client experience.
"Taxable accounts are where the frictions show up most," someone from an advice firm told The Lang Cat and Morningstar Wealth.
Another added: "If the platform links aren't right, money can sit in cash, and nobody notices until later."
When advisers describe what they would change about platforms in the context of centralised investment proposition (CIP) and MPS capability, the biggest pain points are reporting and client communication.
The research found that clearer performance views, cleaner management information, and outputs that present the MPS mandate rather than confusing clients with long lists of underlying funds and contract notes.
Tax and cash management creates ‘stubborn friction'
Tax and cash management also create stubborn friction, the research found, including better CGT notifications and calculations, minimum cash rules and ring-fencing cash for income.
Many respondents also pointed to workflow limitations that drive unnecessary administration, such as slow transactions, accounts being locked during withdrawals or rebalances, and the awkwardness of running multiple models or providers for one client without creating additional accounts, sub-accounts, or manual workarounds.
The report stated that while most advisers can work around these issues, the cost is paid in time, additional administration and more difficult client conversations.
Morningstar Wealth head of proposition EMEA Steve Owen said that a consistent theme in the research is that advisers do not experience platform and MPS as separate decisions, but as one system.
"Where platforms still run MPS as a collection of separate parts, it becomes harder for firms to explain what they are recommending, harder to report on outcomes, and harder to evidence decisions within a CIP – often generating unhelpful ‘paperwork' along the way," he said.
"In practice, advisers are recommending an MPS solution, not the underlying holdings. How well that recommendation works day-to-day is shaped by platform capability, governance and reporting, rather than by portfolio design alone."
The Lang Cat insight director Steve Nelson said of the research: "We wanted to get beyond the typical first order MPS debate (adoption charts, cost comparisons and performance headlines and the like) and look at what MPS usage really means inside advice firms day to day."
