HL clients in line for potential £15m payout after challenge to HMRC

Debate over loyalty bonuses

Laura Dew
clock • 2 min read

Hargreaves Lansdown has won a 'discount tax' challenge against HM Revenue & Customs (HMRC), which could lead to at least £15m in annual management charges returned to around 150,000 investors.

Hargreaves Lansdown introduced 'loyalty bonuses' - discounts provided against the ongoing management charges - for clients over 15 years ago but in April 2013 the rebates were deemed taxable by HMRC.  In September 2013, Hargreaves Lansdown launched a legal challenge to this rule calling it an "unwarranted attack on private investors". The firm took the case to the tax tribunal and revealed this morning it has been ruled that loyalty bonuses are not taxable. As a result, £15m could potentially be returned to investors, and, in addition, there is now no need to declare these discount...

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