The bill is more than twice the £5m figure estimated when Keydata was pushed into administration by the FSA in early June.
In terms of investor tax liability, PwC confirmed at the end of July that Keydata or Lifemark products invested with Lifemark S.A had been identified as non-Isa-compliant and could therefore incur tax liabilities.
It said income for these products, which have over £350m invested, would be paid gross and clients would need to include all income paid by the administrators on their pers-onal income tax return.
PwC said income payments would recommence on other suspended Keydata plans after it had satisfied itself of their Isa eligibility and had confirmation on witholding tax.
It said it would review each product and talk to the underlying product providers about withholding tax from income payments and, where it got sufficient assurances that there was no requirement to deduct tax, these payments would be made gross.
PwC joint administrator and partner Dan Schwarzmann says the firm has already secured these assurances from providers on over 20 plans out of 160 in total and expects to conclude the checks in September.
Schwarzmann says: “We have now agreed a procedure to satisfy ourselves that we can satisfy the Revenue. There are about 160 plans to work through and as we agree each plan, we can then start to make income payments on it.
“We have now agreed over 20 out of the 160 and I expect that all of them will be completed in September and that income will be flowing for everybody.”
HMRC practice is to seek recovery of any tax liability from the Isa manager rather than from individual investors. However, both parties have not confirmed whether affected plans would retain their Isa status at maturity.
HMRC says it is working to establish all of the facts about the company’s Isa investments. A spokesman says: “Once this work has been completed, HMRC will be able to provide further advice about the impact on individual investors.”