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AJ Bell ends TD Sipp deal due to acquisition

AJ Bell ends TD Sipp deal due to acquisition

AJ Bell has decided to end its agreement with TD Direct Investing because of "uncertainty" over its acquisition.

From December AJ Bell will no longer provide self-invested personal pension trustee and administration services for the TD Sipp.

Earlier this week Interactive Investor completed its acquisition of TDDI, which is TD Bank Group’s European direct investing business.

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A spokesman for AJ Bell said: “Given the uncertainty created by the announcement of the acquisition of TD Direct Investing by Interactive Investor we took the decision to terminate our Sipp administration services for the TD Sipp.”

The spokesman said AJ Bell would not be commenting further on the issue.

In a joint letter to investors, AJ Bell and TDDI have told them they can either keep the investment services with TDDI, keep the trustee and administration services with AJ Bell or transfer both to a third provider.

Both companies have promised there will be no transfer fees to pay for any of these options but investors need to reach a decision by the end of September.

The letter said: “If you do not respond or if we have not received the necessary forms for the transfer by 30 September 2017, option two will apply and the investments held in your Sipp will be transferred to AJ Bell Youinvest during the period October to December 2017.”

Those who keep the investment services with TDDI will go into the TDDI Sipp which is operated and administered by Barnett Waddingham.

This scheme is currently being registered with HM Revenue & Customs.

Alex Kovach, chief commercial officer at Interactive Investor, said: "Looking ahead, Interactive Investor wants to offer both continuity and improvement in terms of the Sipp services it provides to TDDI customers.

"We have found a great partner in Barnett Waddingham, who work for many blue-chip organisations, including Pepsi, Zurich, P&O, and Bosch.

"Our aim is to have greater control over the Sipp services we offer, ensuring that they are easy to use, digitally-enabled, simpler, fairer in terms of pricing and very competitive on drawdown charges."

There are a number of differences in the charges between the current Sipp, AJ Bell’s Sipp and the new TDDI product.

Investors at the moment pay 0.25 per cent half yearly as an annual account fee and those staying in the new TDDI Sipp will pay £100 plus Vat annually in advance while those moving to AJ Bell will pay no charge.

Meanwhile buying and selling funds online with AJ Bell costs £1.50 per trade but this is free of charge with both the current TD Sipp and the new TDDI Sipp.

Online share dealing rates for the current TD Sipp cost between £5.95 and £12.50 depending on trades in the previous 90 days and this will remain the same for the new TDDI Sipp.

Investors moving to AJ Bell will pay between £4.95 and £9.95 depending on trades in the previous month.