All money is held in our accounts at Barclays Bank Plc. Interest is paid by Barclays Bank to us on the aggregate of all client money held in the general client account and, subject to any interest paid to clients as above, is for the benefit of the firm.
We aim to account to you for interest at a reasonable rate of interest, however as the holding of your funds is incidental to the carrying out of your legal instructions, the rate is unlikely to be as high as the rate you may be able to obtain when depositing the money with your bank. All client money, whether general client funds or designated deposited funds, will be held on instant access terms as set out in the Solicitor’s Regulation Authority accounts rules. Whether your money is held on our general client account or in a separate designated deposit account, any interest paid to you is paid without deduction for income tax (unless you are resident overseas – see below). As such it is your responsibility to inform HMRC of interest amounts received from us and the implications of this will depend upon your own financial circumstances. The same rate of interest will be paid on money held in general client account as will be paid on money held in a separate designated deposit account (assuming that this will offer a fair and reasonable outcome for the client and the firm). Under the European Savings Directive regulations 2003/48/EC we are required to inform HRMC of payments of interest to relevant payees and residual entities in prescribed territories. Where you reside outside of the UK and EC, we are required to deduct income tax at the current basic rate and account for this interest to HRMC directly and pay you the net amount.
In accordance with Law Society guidance, if the bank in which we hold funds should fail we reserve the right to disclose to the FSCS the names and other details of clients whose money is held there in order for those clients to claim compensation up to the applicable limit, currently £85,000. Interest will be calculated from the time the funds become cleared for interest purposes. Interest will be calculated on a daily basis and calculated on amounts held overnight from the day the funds become cleared for interest purposes.
Interest is added to each client account quarterly and/or at the end of each case if sooner, on designated deposit accounts. Where money is not placed in a designated deposit account interest will not be paid if the sum of money held is not exceeding the amount shown in the left column below for a time not exceeding the period indicated in the right column. Interest will only be paid if the amount is £20 or more.
The rate of interest is based on our current bank rate which is linked to base rate and monitored regularly. Please contact us for the current rates