We are required by the Solicitors Account Rules to hold such client money for the purpose for which it has been provided and it is therefore necessary for it to be held in an instant access account. For this reason, any interest that will be paid on the funds held, when appropriate, is unlikely to be as high as that obtainable by a client depositing the funds themselves.
In particular:
1. Client monies will normally be held in general client bank accounts, in which monies for different matters and clients are pooled.
2. A sum in lieu of interest will be payable on amounts held in general client bank accounts on the following basis:
- Interest will be calculated from the date that the money has been cleared in our bank account and is regarded by the bank as cleared funds. Simple interest will then be paid, or credited, when the monies are paid out for the purposes for which they were required.
- Interest paid will be based upon the rate of interest payable by the Royal Bank of Scotland on the relevant amount if it were to be held separately in our instant access general client account.
- In normal circumstances, if the total amount of interest calculated is less than £20.00, no interest will be paid or credited to the client, as our administrative charges would exceed this amount.
3. Client monies will normally be held in an instant access bank account to facilitate transactions. However, if specific instructions are received from the client requesting that funds be placed on a term deposit, or separate designated deposit account and if this is appropriate (bearing in mind the nature and duration of the transaction) interest earned on such deposits shall be paid to the client in full, less any reasonable administration fee to be charged by ourselves in respect of setting up, administering and terminating such deposit account.
4. If client monies are held in a separate designated deposit account (i.e. a specific bank account for a specific matter) all interest earned on that account will be credited to that bank account and paid to the client in full. Interest will normally be paid to the clients gross and it will be for the client to account for tax thereon. In designated deposit accounts and term deposit accounts, the bank may deduct tax at source and if this occurs the net sum will be paid or credited to the client.
This policy is reviewed from time to time by our COFA and clients will be notified of any changes.