III change SIPP charges.

2shy

Edit: Didnt look very hard
http://forums.moneysavingexpert.com/showpost.php?p=66108808&postcount=355

Didnt see this posted anywhere.
Received a PM from II saying they are changing their SIPP charges.

We have introduced our new SIPP pricing today, along with some important changes to SIPP accounts:
The main features of our new SIPP pricing are:

• Our annual SIPP administration fee reduces from £144 (£120+VAT) to £96 (£80+VAT).
• All SIPP customers will now pay their SIPP administration fee annually in advance on the anniversary of opening their account
• Customers on the new pricing will pay our £20 quarterly fee which comes with two free trades (or £20 quarterly commission credit)
• £20 quarterly commission credit (or two free trades) can be used across your SIPP, ISA and trading account
• 0.1% interest paid annually on all cash holdings in your SIPP account *

* As a result of recent regulatory changes to the way firms can put money on deposit with banks, we are unable to continue with our current rate of 0.5%. We will now pay interest on cash held within your SIPP at 0.1%. This interest will continue to be paid annually.
This new SIPP pricing for new customers launches today. However, as a valued existing SIPP customer we are offering you the choice to either :

1. stay on your current SIPP price of £120 +VAT with no quarterly fee, but with all other changes to SIPP accounts applying, or
2. move to our new SIPP pricing and benefit from the free trades included in the price

With the new SIPP pricing you only need to trade four or more times a year to make a saving on your current pricing (see our examples below). As the average number of trades our SIPP customers make a year is over 20, we believe the majority of our customers will be better off with the new pricing.
We will only make the changes effective from 1 November 2014 for our existing SIPP customers, giving you plenty of time to assess which option will be best for you.

jamesd

Would someone who has an account with them please ask about "As a result of recent regulatory changes to the way firms can put money on deposit with banks, we are unable to continue with our current rate of 0.5%. We will now pay interest on cash held within your SIPP at 0.1%. This interest will continue to be paid annually."

In a phone call they said that this was due to the FCA's PS14/9 but they couldn't say which paragraph of that large document it was.

One change, in paragraph 7.56 lets firms "agree" an interest rate with clients instead of either passing on all interest or no interest. I am wondering if they are using that flexibility to agree to keep some of the money that they previously paid out.

However, in the call it was mentioned that part of it was due to the money "having" to be held in the account rather than placed elsewhere. That might imply that it is now in a client money account with £50,000 FSCS protection instead of a deposit account with £85,0000 FSCS protection (if you didn't know that you could get the 85k limit in an investment product for money on deposit just trust that it was possible or read PS14/10 and it's consultation document). This confuses me. They say it's on deposit but that it can't be on deposit. Which is it, deposit, which normally has £85,000 protection or client money with £50,000?


I got the answer that cash is always £85,000 FSCS protection, which is not my understanding of the actual situation.