Trying to understand IWeb charges when buying a share inside ISA, what are these extras?

isayhello

I was going to buy a share on IWeb and put 4k into the purchase, I know there is a dealing charge and stamp duty on shares but there were extra costs on the page I didn't understand.

They included an ongoing charge of almost £35 and a transaction cost of about £4 which bought the whole purchase cost to about £60.

I thought ongoing charges are usually for funds? Are these normal charges that IWeb and other platforms would make?

I joined IWeb because of their lack of annual fee once you sign up but do they make up the cost through these other charges?

Any advice from more experienced investors would be great.

eskbanker

isayhello said:

I was going to buy a share on IWeb and put 4k into the purchase, I know there is a dealing charge and stamp duty on shares but there were extra costs on the page I didn't understand.

They included an ongoing charge of almost £35 and a transaction cost of about £4 which bought the whole purchase cost to about £60.

Which page is this that you're looking at?  Which share are you considering?

https://www.iweb-sharedealing.co.uk/assets/costsandcharges.pdf has the fee schedule, are the charges consistent with that?

ColdIron

Telling us what you were trying to buy would help a lot otherwise it's just guesswork

jimjames

isayhello said:

I joined IWeb because of their lack of annual fee once you sign up but do they make up the cost through these other charges?
Any advice from more experienced investors would be great.

No they don't. Not sure what you are buying but if it's something that has charges inside like an investment trust then it may show those charges even though iWeb don't charge them. Buying a UK share and the only cost is £5 plus stamp duty.

EthicsGradient

It might be best if you give the exact wording and the amounts they listed on the contract note eg (and I'm not a iWeb customer, so I don't know how they normally put it)
1300 shares @303p = £3939.00
stamp duty @0.5% = £19.69
dealing charge = £5.00
"transaction cost" = £3.99
"ongoing charge" = £34.99
total paid = £3999.67

isayhello

Sorry, I forgot to add, it is called greencoat wind and i was told it is just a regular company that you can buy shares in but checking it now, I see that it's called a close ended investment company so maybe it is different than just a regular company such as Coca Cola.

EthicsGradient

isayhello said:

Sorry, I forgot to add, it is called greencoat wind and i was told it is just a regular company that you can buy shares in but checking it now, I see that it's called a close ended investment company so maybe it is different than just a regular company such as Coca Cola.

Did you read the replies to you?

Have you already bought the shares, in which case the contract note will say exactly how much the charges were, or are you looking at something like a "costs & charges illustration" presented to you before you bought, which may include estimates of ongoing charges by Greencoat Wind's management for running the investment trust?

wmb194

isayhello said:

Sorry, I forgot to add, it is called greencoat wind and i was told it is just a regular company that you can buy shares in but checking it now, I see that it's called a close ended investment company so maybe it is different than just a regular company such as Coca Cola.

It's an Investment Trust*. 

iWeb adds a page that shows iWeb's commission, the stamp duty due if applicable and then a table of the trust's internal fees. You can ignore the internal fees, these are not something iWeb will charge you. The table *tries* to make it clear...

*"The Company has been approved as an investment trust under sections 1158 and 1159 of the Corporation Taxes Act 2010. As an investment trust, the Company is required to meet relevant eligibility conditions and ongoing requirements. In particular, the Company must not retain more than 15 per cent of its eligible investment income. The Company has conducted and monitored its affairs so as to enable it to comply with these requirements."

ColdIron

isayhello said:

Sorry, I forgot to add, it is called greencoat wind and i was told it is just a regular company that you can buy shares in but checking it now, I see that it's called a close ended investment company so maybe it is different than just a regular company such as Coca Cola.

IWeb charge £5 and stamp duty. The other charges are internal to the trust and are removed from its value so you won't receive an explicit charge. This would happen regardless of which platform you used

Eco_Miser

isayhello said:

Sorry, I forgot to add, it is called greencoat wind and i was told it is just a regular company that you can buy shares in but checking it now, I see that it's called a close ended investment company so maybe it is different than just a regular company such as Coca Cola.

It's different in how it makes its money, and is subject to special rules about dividends (and other things), but for buying and selling, it's just another company listed on a stock exchange.

GeoffTF

Do not believe that numbers for costs that iWeb provides. They are sometimes typical numbers for similar products, rather than the product that you have. HSBC greatly increased the OCF on some of their funds last year. That is reflected in the latest KIID and Prospectus for the funds concerned, but most platforms and websites still quote the old OCF. Always check primary sources.