We have negotiated with fund managers to repay a proportion of their annual charge as a rebate. The ways these are treated vary between the three charge bases (two of which are for legacy business).
Charge Basis 1
(Investor Charge and Commission) – Bundled, closed to new business
We retain a proportion of the rebate to offset our administration costs, and the remainder is used to pay ongoing trail commission to the adviser. This represents a further saving on the overall cost of the investment.
Charge Basis 2
(Investor Charge and Adviser Fees) – Bundled, closed to new business
We retain a proportion of the rebate to offset our administration costs, and pay the rest to the client in the form of additional units. This has the effect of reducing the fund manager charge on the fund.
All ISA and Collective Investment Accounts held in the above charging structures were moved to the unbundled charging structure (Charge Basis 3) by the end of 2015, ahead of the Sunset Clause.
Charge Basis 3
(Product/Service Charge and Adviser Fees) – Unbundled
Any rebates received are repaid to the client in full in the form of units