Malcolm Pengelly answers a query on the tax treatment of commissions paid to or for the benefit of investors.
Many of my clients hold life assurance policies and bonds some taking annual 5% withdrawals. I am unclear as to the possible impact on policyholders of the change in treatment of certain commissions and other payments announced by HMRC earlier this year. HMRC’s guidance appears rather complex and I would appreciate a more down-to-earth explanation of the change and its effects.
The changes to which you refer came about as a result of the Financial Services Authority’s Retail distribution review which required independent financial advisers to move from commission-based arrangements to fee-based arrangements in respect of ‘retail investment products’ issued from 1 January 2013 and also...
