Don't look VAT in anger: Is the MPS trend here to stay?

VAT operational issues explored

HMRC indicated VAT may not be necessary on top of model portfolio services

HMRC indicated VAT may not be necessary on top of model portfolio services

After HM Revenue & Customs indicated VAT may not be necessary on top of model portfolio services, DFMs have been racing to remove the charge from their propositions. Jon Yarker investigates what's happening with the trend and whether the tax will return.

Over the past 12 months, DFMs throughout the UK have been removing VAT from their model portfolio services (MPS). This is an industry-wide trend and, according to NextWealth research from December 2020, 14 firms out of a sample of 30 had removed this tax.  In addition, at that time a further six firms were actively reviewing the issue and, since those figures were gathered, a further three firms have ditched VAT on their MPS. This highlights a significant contrast from 2019, when NextWealth found all discretionary fund managers (DFMs) charged VAT (except for one that included this tax...

To continue reading this article...

Join Investment Week

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now


Already an Investment Week


More on Funds

Three funds have Square Mile Investment Consulting and Research rating change

Hugh Sergeant's R&M Global Recovery loses Square Mile rating

SVM UK Opportunities retains rating

clock 04 July 2022 • 3 min read
Adam Jones is managing director of Ada Fintech and CTO at Redington

Can better data help rebuild trust between investors and fund pickers?

Products are intangible

Adam Jones
clock 01 July 2022 • 4 min read
The ETFs aim to overcome traditional yield shortfall by using multi-factor investing.

Invesco launches two ESG credit ETFs

Invesco has launched two new ESG ETFs that provide investors with access to investment grade fixed-rate euro-denominated unsecured corporate bonds from global issuers.

clock 29 June 2022 • 2 min read