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Clean Funds

When you have bought funds in the past you may not have known that they include a number of different charges. One of these charges is called trail commission, part of the Ongoing Charges that are set by the fund manager.

This can be confusing and it means that some of your investment growth is reduced because money is being paid out as trail commission to the distributor of the fund.

With effect from 1 April 2014, TD is rebating any trail commission to customers in full.

All the funds available to purchase on our platform are clean funds with no trail commission included in the ongoing charges. This means that more of your money remains invested.

There are over 1,600 clean funds to choose from.

Clean funds vs trail-based funds

The chart below shows a breakdown of charges for trail based and clean funds. It highlights an example based on a trail bearing fund with ongoing charges of 1.6%, compared with the equivalent clean fund with ongoing charges of 0.85%. With clean funds, no trail commission is included in the ongoing charges, meaning more of your money stays invested in your fund portfolio.

Here is an example of what you would pay with a trail based fund and a clean fund. This example is based on the Aberdeen UK Equity Fund, held with TD. Fund manager prices are correct at 14th February 2014.  An initial sales charge (ISC) may also be charged as a one-off fee when you buy funds, however in this example, there was no ISC.

Please note that income tax may be payable on trail commission rebates, which would further increase the cost of a trail bearing fund.

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Search for your converted clean fund

The Financial Conduct Authority (FCA) has introduced regulations to make the charging structure of Funds clearer and more transparent. These new regulations mean that we need to change the Fund investments you hold with us and we want you to understand what these changes mean.

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  • The value of your investments can go down as well as up. You may not get back all the money that you invest.
  • Please note the tax treatment of these products depends on the individual circumstance of each customer and may be subject to change in future.
  • A percentage of the value of your investment may be charged by the Fund Manager. To view these charges (Ongoing Charges), please refer to the relevant KIID.

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