This paper presents the findings from our clarity of fund charges review.
August 2025 update: This review is historical. See our what we publish[1] page for more information and current views.
Who should read this paper?
Our findings will primarily be of interest to UK firms operating funds, platforms, advisers and other retail fund intermediaries.
What was the scope of the review?
The paper looks at the clarity of fund charges. It is important for investors to be able to understand and compare charges because, with performance and the levels of risk, they contribute to fund returns.
Our review included 11 firms that operated funds sold to UK retail consumers, including investment managers, banks and insurers, who collectively manage 29% of funds in the UK retail market.
What are our findings?
We found examples of firms who provided their customers a consistent, combined charge figure across all relevant documents and platforms, but there were still examples of firms referring to different charge figures across multiple documents, making effective comparisons difficult.
There are 2 main messages from our work:
- Using the annual management charge (AMC) in some marketing material and the ongoing charges figure (OCF) in other documents may confuse investors and hinder their ability to compare charges.
- Using the OCF consistently in all marketing material for UCITS funds is likely to help investors understand and compare charges.
TR14/07 Clarity of fund charges[2]
What are our expectations?
- Fund charges to be clear to investors, particularly retail investors, so they know what they are paying for and can compare between funds.
- Communications with retail customers should be fair, clear and not misleading for both UCITS and non-UCITS funds.
- For UCITS funds, charges information in marketing material, including websites, must be presented to investors in a way that is consistent with the key investor information document (KIID). This means using the ongoing charges figure (OCF) as the headline charges figure.
- Platforms, advisers and other intermediaries should also use the OCF as the headline charges figure for UCITS funds.
- Descriptions of charges in the prospectus should explain clearly how the charges work.
- Fund charges to be clear to investors, particularly retail investors, so they know what they are paying for and can compare between funds.
What are the next steps?
A number of new European legislations are due to be implemented over the coming years, including PRIIPS and MiFID II, which will change the way information is provided to investors at the point of sale. This report is a reminder of the current rules that firms should be following to ensure charges are clear to investors. We will follow up on this work through our routine supervision.
The FCA will continue to work with the Investment Management Association and firms to deliver better information to investors.