Stockbrokers for Investment Clubs Sep’25

greybags

I’m not sure that’s right. From what I am reading, Trusts are now required to register even if they don’t have any requirement to pay tax themselves. The HMRC service is not now just a tax thing, it’s for anti money laundering as well. 

dunstonh

ShareClubber said:

I am the deputy treasurer for a 30-year-old share club. This forum has been very informative.  Has anyone considered setting up a trading account in the name of one member?  I imagine the club members would need to sign some sort of agreement to protect the interests of each member and the one holding the account.  It would need to address tax liabilities, repayment of funds to members and what happens if the account holder leaves or dies.

That one member would be subject to tax individually.   It would form part of their estate.  It would be a complete nightmare.

A much simpler method is for members of the club to continue meeting, discussing and enjoying the same social side as they do now except intead of pooling their money, they mirror the transactions agreed in the meetings on a personal level using their own ISA, pension or GIA.

Dorcots

dunstonh said:

ShareClubber said:

I am the deputy treasurer for a 30-year-old share club. This forum has been very informative.  Has anyone considered setting up a trading account in the name of one member?  I imagine the club members would need to sign some sort of agreement to protect the interests of each member and the one holding the account.  It would need to address tax liabilities, repayment of funds to members and what happens if the account holder leaves or dies.

That one member would be subject to tax individually.   It would form part of their estate.  It would be a complete nightmare.

Not true. The account would held by a trustee of the club and so it would be clear who owns the account. This is very different to the club being a Trust which is very very onerous.

Try googling "what are the duties of a trustee of a club".

poseidon1

greybags said:

I’m not sure that’s right. From what I am reading, Trusts are now required to register even if they don’t have any requirement to pay tax themselves. The HMRC service is not now just a tax thing, it’s for anti money laundering as well. 

Certainly trusts are required to register, and that includes bare trusts.

 Investment clubs however are more often than not constituted as unincorporated associations and as such are (for the present ) outside the HMRC Trust Registration regime.

SH88SH88

page 11 of this week's Investors Chronicle has an article about Investment Clubs ,,,, brokers removing access for investment clubs  etc .....

dunstonh

Dorcots said:

dunstonh said:

ShareClubber said:

I am the deputy treasurer for a 30-year-old share club. This forum has been very informative.  Has anyone considered setting up a trading account in the name of one member?  I imagine the club members would need to sign some sort of agreement to protect the interests of each member and the one holding the account.  It would need to address tax liabilities, repayment of funds to members and what happens if the account holder leaves or dies.

That one member would be subject to tax individually.   It would form part of their estate.  It would be a complete nightmare.

Not true. The account would held by a trustee of the club and so it would be clear who owns the account. This is very different to the club being a Trust which is very very onerous.

Try googling "what are the duties of a trustee of a club".

Try reading what was said.    Specifically:  "Has anyone considered setting up a trading account in the name of one member?"

Dorcots

Today I contacted HMRC. I was referred to a specialist who also consulted with colleagues.
We talked around the HMRC internal manual, Capital Gains Manual (the CG20600 - Investment clubs page in particular).
He confirmed that HMRC do not have any specific guidance on how an investment clubs buy and sell their investments.
He also confirmed that where a club trading account is held by a nominee and provided trades follow that manual (particularly the "Return of members’ gains" section), HMRC would not hold the nominee liable to tax on the trading account. Tax would be applied at the individual club member level.
HMRC do not want any of this information but will ask for it as required.

He recommended that if a club changes trading platform, they should inform HMRC at:  His Majesty's Revenue and Customs, Investment Club Services, PO Box 4000, Cardiff CF14 8HR

The letter would best advise details of governance such as

•   Following HMRC CG20600 - Investment clubs
•   Constitution etc
•   Meetings and minutes
•   Accounts
•   Form 185 is given to each member annually

So I am confident that it is acceptable for investment clubs to change to a standard (personal) trading account.

findthetruth

Further to other posts on this forum, here are some answers from Ms Rodriguez of IBKR.

She typed them in red but this doesn’t show. Hope it’s clear though.

The LEI is possibly an issue as ii did not require one, but she seems clear that IBKR are prepared to onboard Investment Clubs and all their members for free!!

As you know, ii have ceased offering services to Investment Clubs. You must be inundated with requests since your contact details have appeared in many places in forum discussions.

It’s great that you are open to Investment Clubs, and I have a few questions please…

 

1.Can you confirm that you are prepared for all these clubs to join IBKR? 

We do onboard investment clubs. 

2.Investmen Clubs do not normally have an LEI as they are not a legal entity. ii didn’t need one. Do you?

 I have double checked, and we do require a LEI number for investment clubs. 

3.I see that you need the member’s identity documents. Please be detailed as sometimes original passport (eg) or copies are needed and sometimes not. 

All documents are uploaded in the application. We need proof of identity and address. 

4. As this is a lot of work for IBKR, are there charges involved? 

We do not charge any fees for opening and keeping an account opened at IBKR. 

5. Once set up, will other charges be as for individuals? 

No, we do not charge custody and/or maintenance fees. 

6. I assume we do our own trading online. Will all members be able to view the account or just the treasurer? 

The person who opened the account can later create users for the club members. 

7. Can IBKR transfer the existing shares’ in specie’ or must we sell all and start again? 

We do accept asset transfers as long as it’s on the name of the same entity. 

 

We have 12 members, all British, and a portfolio of £55000 and growing.

 

Thanks. Sorry for all the questions. Understandably we are anxious and can’t afford to start off in a wrong direction since we have 6 weeks before we have to move. 

If you decide to open the account, please follow the link 

I’M NOT YET ALLOWED TO POST LINKS AS I’M NEW TO THIS FORUM

Extinctclub1

I have just received the following from AJ Bell confirming they will not be providing an investment club account:

"Thank you for your email and apologies for the delay in coming back to you.

Unfortunately, AJ Bell do not currently offer a Dealing account for an Investment Club. That said, we are aware of Interactive Investor’s (II) decision to cease offering these account types from Monday 27 October.

Over the past 2-3 weeks we have received several enquiries from Investment Club members seeking a new platform for their account. As a result, our Product Team recently conducted a review to see if this new account type is something we would be interested in introducing to the AJ Bell platform.

After careful consideration, due to the operational complexity and ongoing oversight of these accounts, I regret to inform you that AJ Bell will not be offering Investment Club Dealing accounts and we have no plans to do so in the future.

I’m sorry this isn’t the outcome you had hoped for but thank you for registering your enquiry and we wish you all the success in finding a new home for your Investment Club.

Kind regards

Aaron Willsher
Customer Onboarding Team"

 

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LIC2000

Extinctclub1 said:

I have just received the following from AJ Bell confirming they will not be providing an investment club account:

"Thank you for your email and apologies for the delay in coming back to you.

Unfortunately, AJ Bell do not currently offer a Dealing account for an Investment Club. That said, we are aware of Interactive Investor’s (II) decision to cease offering these account types from Monday 27 October.

Over the past 2-3 weeks we have received several enquiries from Investment Club members seeking a new platform for their account. As a result, our Product Team recently conducted a review to see if this new account type is something we would be interested in introducing to the AJ Bell platform.

After careful consideration, due to the operational complexity and ongoing oversight of these accounts, I regret to inform you that AJ Bell will not be offering Investment Club Dealing accounts and we have no plans to do so in the future.

I’m sorry this isn’t the outcome you had hoped for but thank you for registering your enquiry and we wish you all the success in finding a new home for your Investment Club.

Kind regards

[Text removed by Forum Team]
Customer Onboarding Team"

 

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Unfortunately we received an identical response as, I imagine, many other clubs did