Our charges

Charges

Charges are an important part of the relationship between our customers and the services that we provide. Willis Owen will always endeavour to be as transparent as possible with its charging structures and provide easy access to the rates that are applicable to individual investors.

When you invest in Funds there are three types of charges which you may see quoted, the Fund Manager Charge being the most comprehensive:

Annual Management Charge (AMC) - the internal costs of running the fund the AMC typically comprises the investment management fee plus any other charges for its own services, such as administration or marketing. It usually excludes any fees or charges paid to 3rd parties.

The average AMC is around 0.75% in most actively managed funds but can vary depending on what is included. A few providers now quote the same figure for AMC and OCF.

Ongoing Charges Figure (OCF) - incorporates the AMC, as well as a number of additional costs and expenses, that are taken directly out of the fund in the previous 12 month accounting period to its financial year end. It includes 3rd party costs such as: audit fees; custody fees; financing costs; custodian fees; shareholder reporting costs; regulatory fees; director’s fees (where applicable) and bank charges.

Research costs may also become part of on-going costs unless the Fund Provider states they will absorb them into their own operating costs. The OCF excludes: performance fees (where applicable) and portfolio transaction costs, except in the case of other collective investments held (for example, by a multi-manager fund).

Fund Manager Charge (FMC) - is presented in the ex-ante costs document, comprises the OCF plus all costs related to transactions. It also includes incidental costs which are primarily performance fees. It captures all transaction costs for the product over the last 3 years, incurred as a result of the acquisition and disposal of investments, and works out an average. This covers: broker charges, mark- ups included in the transaction price, stamp duty, and foreign exchange costs.

Transactions costs can be divided into explicit and implicit costs. Explicit costs relate to the tax and commission charges added to the transaction settlement amount. These costs can be clearly identified and quantified. Implicit costs, also called slippage costs, are more complex calculations which work out the difference between the price when a trade is placed and the price it is dealt.

Then there are broadly 3 levels of charges which include a Service fee to Willis Owen, this fee is typically between 0.25% to 0.50%, dependent on your choice of provider/platform, such as a:

  1. Aegon Platform fee of 0.23% and our Service charge of 0.50%
  2. Direct with a provider, that is not using a platform, our Service fee is 0.50% or 1% up front payment dependent on the provider. Willis Owen no longer accepts ISA or GIA business direct with Fund Providers
  3. The Willis Owen platform Service fee is based on a tiered rate as follows:

Service fee ISA/GIA/SIPP

Tier
ISA
GIA
SIPP
£0 - £50,000
0.40%
0.40%
0.60%
£50,001 - £100,000
0.30%
0.30%
0.40%
£100,001 - £250,000
0.20%
0.20%
0.25%
£250,000 +
0.15%
0.15%
0.15%

These costs are for each ‘tier’ of your overall Account. So, as an example on the Willis Owen platform for ISA or GIA or combined ISA and GIA, for the first £50,000 invested you pay 0.40%, which equates to £200 per annum, then for the next £50,000 you pay 0.30%, which equates to £150 per annum and so on.

The first £50,000 invested in a SIPP, you pay 0.60%, which equates to £300 per annum, and then for the next £50,000 you pay 0.40%, which equates to £200 per annum and so on.

Likewise, if you invested £120,000 split equally between an ISA and a SIPP you would pay 0.33% for the ISA which equates to £198 per annum and 0.46% for the SIPP which equates to £276.00 per annum. The blended rate takes into account your total portfolio value across your ISA, GIA or SIPP.


Service fee JISA

Tier
Junior ISA
£0 - £50,000
0.40%
£50,001 - £100,000
0.30%
£100,001 - £250,000
0.20%
£250,000 +
0.15%

These costs are for each ‘tier’ of your Junior ISA only.

Tier and fee calculations are based on Funds, Share, Investment Trusts, ETFs and Cash balances.

The Willis Owen platform SIPP Drawdown fee is £132.00.


Our fee covers:

  • Fund research – supplied by selected third party research companies
  • Quality client service – you can speak personally to experienced and friendly staff on the telephone, which are based in the UK
  • Online tools (including a detailed report of all your investments) and guidance to help you make investments decisions
  • The ability to manage your account online
  • Telephone dealing
  • Our highly acclaimed ISA Guide and market commentary
  • Email newsletter and Fund updates.

If you do not agree to the charging structure(s) applied by Willis Owen or its partners then services will be terminated at the company’s discretion.

How we collect our fee

We arrange your investments on either a commission basis, or fee basis. Where an investment is arranged on a commission basis, we are paid commission by the Product Provider and we will not apply any other charge in respect of that investment. These charges will usually have been built into the Annual Management Charge of your investment.

Where the provider of an investment which we have arranged for you does not pay us commission, you will usually pay a lower Annual Management Charge for your investment. Our fees will be deducted by the Platform or Product Provider from your Cash Account, or by unit cancellation from your investment(s), and paid to us directly. This is our preferred method of administering fees but is usually only available when you invest through Platforms or life companies. These charges are usually calculated daily, but levied on a monthly basis.

We reserve the right to amend our fee model(s) and collection process at any time. If we do so we shall seek to give you no less than fourteen business days’ notice in advance, but where this is not practicable we shall notify you as soon as possible.

A full list and summary of all charges can be found within our website.

Commission-included Fund charges

Willis Owen may receive an annual commission from a Product Provider which varies from 0.1%-1% of the value of your investment, depending upon your Fund choice. For example, if your Fund value averages £4,000 over a one year period and the Funds in which you invest generate an average commission to Willis Owen of 0.5%, Willis Owen will typically receive a commission of £20.00 over the year.

Commission-excluded Fund or clean charges

New rules have been designed to make sure it's clear to you what charges you pay, and to whom, when purchasing Funds through a Platform. Historically, your charges have all been bundled into one Annual Management Charge (AMC), typically 1.5% per Fund, split between your Fund Provider (e.g. Jupiter), your Intermediary (e.g. Willis Owen) and your Platform (e.g. Willis Owen Platform, Aegon/Fidelity FundsNetwork). Going forward, these charges will need to be applied separately.

The Retail Distribution Review brought with it a new share class ‘commission excluded’ or ‘clean’ share class with a typical equivalent average AMC charge of 0.75%. These Fund charges do not include Platform or Willis Owen fees.