Kingswood is removing VAT from its managed portfolios from April.
This will apply across the £5.6bn firm’s six discretionary model portfolios, meaning clients will only be charged the management fee for its MPS.
Kingswood investment manager Charlotte Cook said: “The decision was made in line with our core value of providing the best possible transparent service to our clients.
“We are always looking for ways to improve our services and by removing VAT from our MPS, we are offering excellent value at a competitive price.”
This is the latest in a trend of DFMs removing VAT from their MPS offerings, as firms attempt to stay competitive with one another.
The trend began in June 2020 when Tatton Asset Management revealed it had received a £1.7m refund from HMRC over VAT charged on its MPS.
This caused DFMs, including Brooks Macdonald, Tilney Smith and Williamson and Sanlam, throughout the industry to withdraw VAT from their own offerings.
Jon Yarker is a freelance reporter for FTAdviser