Fund Management
HMRC Drops Platform VAT Charges
HM Revenue and Customs has decided not to impose VAT on platform service charges following a consultation last October.
HM Revenue and Customs has decided not to impose VAT on platform service charges following a consultation last October.
According to draft guidance obtained by WealthBriefing,
while primary platform services will be VAT exempt, other
platform services, including charges for advice, information, and
research and market data services, will be liable to VAT at the
standard rate. HMRC said that the primary service the platform
supplies in return for this fee is made up of:
-The aggregation of the investors’ capital to bulk purchase
securities in funds and other investment products.
-The recording of the transactions and holdings;
-The holding of the investments in trust as nominee, and
-The disaggregation of the income from the holdings, including
realisation of the assets, in accordance with the individual
beneficiaries’ investments.
“In its review of the operation of investment platforms, HMRC is
consulting on an informal basis with industry representatives as
part of this process. We are not focusing the review on any
particular aspects of the operation of these platforms, and all
areas are under consideration, including the different charging
structures used by these platforms for the provision of portfolio
management services," HMRC said in a statement.
HMRC said last March that tax fund rebates received by platform
clients were liable to income tax.
