What Are Investment Platform Fees? (UK Guide)
Investment platform fees are the charges you will pay an investment provider for holding your investments with them. In this guide we explain how platform fees work in the UK, and how to compare fees between different providers.
What is an investment platform?
An investment platform is the online portal offered by an investment provider which customers can use to view, manage, and trade their investments in one place.
Customers can log in to their investment platform account to view their portfolio balance. They can also use it to buy or sell investments.
What are platform fees?
Investment providers charge fees for using their services. These are known as platform fees. Platform fees are charged by providers to cover costs for things like customer service and IT.
Common types of platform fees
- Flat fees - a fixed annual or monthly amount irrespective of the amount that a customer has invested.
- Percentage fees - fees which are charged as a percentage of the amount that a customer has invested. Larger investment amount = larger fees.
- Mixed - a combination of the above. Often structured something like “0.45% of investment amount, capped at £45 per year”
How platform fees are charged in the UK
Platform fees in the UK differ between investment providers. Some providers charge flat fees, whilst others charge percentage fees, or even a mixture of both.
Some investment providers also charge different fees depending on the investment type (funds or shares).
Fees can also vary depending on the account type, e.g. Stocks and Shares ISA vs SIPP (self-invested personal pension). Some providers will charge one platform fee which covers many accounts of different types held with them, whilst others will charge separate platform fees for each account type held.
Why platform fees matter long-term
Platform fees can impact the compounding effect of investments. The money that is used to pay the platform fees each month or year is money that is no longer invested. What may seem like a small percentage fee each month can add up over time and greatly reduce the value of an investment pot over many years.
How to compare platform fees using our calculator
Our Platform Fees Calculator can be used to compare platform fees of many large investment providers that are available in the UK.
To use the calculator, simply select the investment type (funds or shares), the account type, and enter the amount invested. The calculator will show you a graph with the results, allowing you to visually see which providers might be best for you. Below the graph is a table of results showing the annual platform fee charged by each provider.
This does not constitute financial advice. Always do your own research.