Advisers warned misleading marketing could muddy VAT rules

Under HMRC rules intermediation services and ongoing advice are exempt from VAT but investment management, which requires discretionary permissions, is not exempt from the 20% sales tax. However hazy terminology has resulted in some firms which provide intermediation-only services claiming to offer portfolio management services or marketing themselves as wealth managers - thereby giving the impression they are providing investment management which, under HMRC rules, is liable for VAT. "People need to be very careful not to confuse how they describe themselves," said Engage Partnership...