Alliance Trust Savings is reviewing whether to continue charging VAT on top of its platform charges following guidance from HM Revenue & Customs.
Money Marketing revealed earlier this month that HMRC has decided not to impose VAT on platform charges following industry negotiations. Draft guidance from HMRC sets out that core platform services including execution and custody will remain VAT-exempt, and final guidance confirming this stance is expected shortly.
ATS, which hiked its platform fees by up to 87 per cent this month, charges an annual platform admin fee of £75 plus VAT for an Isa or investment dealing account and £155 plus VAT for a Sipp.
ATS head of platform proposition Sara Wilson says: “We are reviewing product VAT in light of the HMRC guidance recently issued and will make an announcement to our customers and intermediaries once we have completed the review.”
The Platforum head of adviser platforms Freddie Findlater says: “ATS’ main appeal for advisers is on price, and the platform is cost-effective for large accounts. The price changes ATS announced threatened to hurt that image so being able to remove VAT could help.”
Murphy Wealth partner Adrian Murphy says: “ATS’ decision to charge VAT stems from them historically being a transaction platform for discretionary fund managers rather than a platform in the retail space.”