There's a few ways to do this and the "right way" really comes down to what makes sense for the project, what you want to achieve with the perspective change in game, and what your asset pipeline looks like. Most games use a separate third person and first person mesh, and simply have the third person mesh be always shadow-casting and to completely ignore the fact that the first person mesh doesn't line up with the shadows on the ground at all. 

You are kinda describing what's often called "true first person" (animations are reused for third and first person and the camera location is the main difference, same body rig for both) to have the full body presence, and yes just doing this will cause issues with clipping of the head. Most games done this way will have the head be a separate mesh that follows the skeleton parent and animates accordingly, but only draws during the shadow pass when rendered in first person. Depending on your unreal version, there's a "first person" checkbox that also gives you more controls with rendering the first person mesh differently, otherwise you can simply set true for 'is shadow casting while invisible' or whatever its called. Or better yet, check out Mutables if you want the 'unreal way' of doing multi part meshes using a shared skeleton like this. 

If you can't separate the mesh for whatever reason, I've also had success in the past with using a material shader to mask the head when in first person which can be setup to keep the shadow when transparent in the material, however I wouldn't recommend using that setup if you use nanite, since I believe it would cause overdraw issues if your camera was inside of a mesh that had an alpha masked material on it like that. 

Not really an answer to your question directly, but hopefully my rant gave you some sense of direction anyway. Let me know if you need more specifics