FCA Fee Calculator - Frequently Asked Questions

Section 1: Select Dual Regulated Status
What does dual regulated mean?

Section 2: Select Firm Exemptions
What is the FSCS?
How do I know if my firm is exempt from the FSCS?
What is the FOS?
How do I know if my firm is exempt from the FOS?
I think my firm is exempt from the FSCS and/or FOS; do I need to tell the FCA?
What does being exempt mean?

Section 3: Select Fee-Blocks
How do I know which FCA fee-blocks to select?
Where are the FSCS & FOS fee-blocks?
What is the FSCS Funding Review?
Why are there no Prudential Regulation Authority (PRA) or Pensions Guidance Service (PGS) fee-blocks to select?

Section 4: Select Firm Options
Why can't I select some of the options shown with Section 4?
How do I know if an option affects my firm?

Section 5: Input Tariff Data
What does tariff data mean?
How do I know what tariff data to enter?

Calculation Sheet
How do I print my calculation results?


Section 1: Select Dual Regulated Status

What does dual regulated mean?

If your firm is authorised by both the Financial Conduct Authority and the Prudential Regulation Authority then you are a dual regulated firm. This will include firms such as deposit acceptors, insurance providers, Lloyd's managing agents and some principal dealers.

Section 2: Select Firm Exemptions

What is the FSCS?

The Financial Services Compensation Scheme (FSCS) began operating on 1 December 2001 when The Financial Services and Markets Act (FSMA) came into force. The FSCS covers claims against firms where they are unable, or likely to be unable, to pay them. In general, this is when a firm is insolvent or has gone out of business.

The FSCS has the power to compensate consumers if any firm authorised under FSMA (or any participating EEA firm) fails. It covers insurance companies, deposit-takers and investment firms.

Following the FSCS Funding Review, the way in which the FSCS levy is calculated fundamentally altered from 2008/09. For further information on the FSCS Funding Review, please refer to our Policy Statement PS07/19.

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How do I know if my firm is exempt from the FSCS?

A firm is exempt from the FSCS if it does not conduct business that could give rise to a protected claim by an eligible claimant. An eligible claimant is a person who is eligible to bring a claim for compensation under COMP 4.2.1.

NOTE: Exempt firms will still be liable to pay base costs towards the FSCS levy. These are the operating costs not directly related to the payment of compensation. For a full break down of the costs associated with the FSCS levy please read our FSCS guidance notes.

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What is the FOS?

The Financial Ombudsman Service (FOS) resolves disputes between consumers and firms and provides a simple, informal and accessible alternative to the courts. The FOS covers complaints against authorised firms about their regulated activities and certain specified other financial services activities.

It is free of charge for complainants. The FOS's decisions are based on what is 'fair and reasonable' and are binding on firms if a complainant accepts them.

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How do I know if my firm is exempt from the FOS?

A firm is exempt from the FOS if it does not conduct any business with eligible complainants, as defined under our rules (DISP 2.4.3R). An exempt firm will not pay any levy to the FOS. Please read our associated FOS guidance notes for further information on this.

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I think my firm is exempt from the FSCS and/or FOS; do I need to tell the FCA?

If you have not previously told us your firm is exempt from the FSCS and/or FOS, please complete the relevant exemption notifications for FSCS and/or FOS. Once we have received your notification, we will contact your FCA supervisor. If they confirm the exemption applies, your firm won't have to pay the relevant levies. If you have already told us that you are exempt from either the FSCS and/or FOS levy, you do not need to tell us again, as exemption will carry over to each fee year.

NOTE: Exempt firms will still be liable to pay base costs towards the FSCS levy. These are the operating costs not directly related to the payment of compensation. For a full breakdown of the costs associated with the FSCS levy, please read our FSCS guidance notes.

You must send us the exemption notification form by 31 March to qualify for exemption for the following financial year. If we receive forms after this, your firm will not be exempt for the current fee year – the exemption will only apply to any following years.

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What does being exempt mean?

The FSCS levy is broken into three parts: base costs; specific costs and compensation costs. If your firm is exempt from the FSCS levy, you will not pay specific or compensation costs, but will still be liable to pay base costs.

The specific costs are the operating costs directly related to the payment of compensation; compensation costs provide the funds to pay any compensation payments. As these two costs are directly related to the payment of compensation, exempt firms will not pay towards them.

Base costs are the operating costs not directly related to the payment of compensation. All firms, including exempt firms, will be liable for this part of the FSCS levy and will see this on their fees calculation.

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Section 3: Select Fee-Blocks

How do I know which FCA fee-blocks to select?

Each fee-block is assigned a unique code as shown within Section 3 of the fees calculator. Next to each fee-block, a description portrays the type of firm and or business activity it covers. Please select the fee-blocks that cover your firm's regulated business activity.

TIP: If you leave the mouse cursor over the fee-block code a help box will appear, describing the relevant fee-block. Clicking on the fee-block code, or the help icon on the right-hand side of the page, will take you to a new screen providing a detailed classification of the highlighted fee-block.

If your firm has previously received a periodic fee invoice you can use the invoice to identify which fee-blocks and industry-blocks the firm falls into. These fee-blocks and industry-blocks will remain the same if the firm has not made any changes to its part IV permission since that invoice.

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Where are the FSCS sub-classes & FOS industry blocks?

If you have selected an exemption to either or both of the FSCS and FOS within Section 2, the FSCS sub-classes and/or FOS industry-blocks will not be shown. You will only have to select the relevant FCA fee-blocks.

Prior to the FSCS Funding Review, the FSCS fee-blocks were directly associated with the FCA fee-blocks. So, for scenarios before 2008/09, the fees calculator will automatically assign the relevant FSCS fee-block to the FCA fee-block you have selected. The exception to this is the A016 FSCS fee-block (Pensions Review Levy) which is not associated with any FSA fee-block. If it applies, you will have to manually select this fee-block. Within Section 5 the firm will be asked for tariff data to calculate the FSCS levy for each fee-block selected if the firm is not exempt.

Following the FSCS Funding Review, sub-classes are used to group together firms who undertake similar types of business. These sub-classes are used in the calculation of the Compensation cost levy and Specific cost levy. The Base cost levy calculation still uses the associated FCA fee-block. To determine which sub-class to select you can click on the sub-class number, or use the help icon on the right of the page, which will take you to a new screen providing a detailed classification of the sub-class.

The FOS industry-blocks are also related to the FCA fee-blocks. So, once you select an FCA fee-block, the associated FOS industry-block(s) will appear within Section 3. Then select the FOS industry-block that applies to your firm. If you don't select a FOS industry-block the fees calculator will not provide a FOS levy calculation for it. Once you've selected the relevant industry-block(s), in Section 4 we will ask you for data to calculate the FOS levy for each industry-block selected. Again, you can view the help files by clicking on the industry-block number or help icon to assist you in selecting the correct industry-block(s).

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What is the FSCS Funding Review?

The FSCS Funding Review was the result concerns expressed about the fairness, proportionality and sustainability of the FSCS's funding arrangements. It began in March 2006 and looked at the way in which the FSCS compensation and specific costs were funded – the Base cost element was not under review.

The review determined that a more robust, sustainable and fairer way to fund the FSCS would be by having 5 broad classes. These classes being:

  • Deposit
  • General Insurance
  • Life & Pensions
  • Investments
  • Home Finance

Each broad class includes two sub-classes (except the deposit class). These (with the exception of the deposit class) are generally split between the ‘provider’ firms (banks and building societies, life and general insurance providers and fund managers/collective investment scheme operators) and firms that carry on distribution or mediation activities (intermediation). The intermediation sub-classes are not limited to just financial advisers or brokers – they include the intermediation services of the ‘provider’ firms. This is a change to the previous position for life providers who, under the prior arrangements did not face a FSCS levy for direct sales. Overlying these broad classes is a general retail pool.

Each sub-class has its own threshold. In the case of a default, the sub-class in which the default occurs (the 'triggering sub-class') bears the cost of the default up to its sub-class threshold. Then, the other sub-class within the same broad class as the triggering sub-class pays for any further compensation costs up to its own threshold. If the broad class threshold is met, the general retail pool provides any excess funding for compensation payments.

The outcome of the review was that from 2008/09 the way in which the FSCS is funded, and as a consequence the way in which the FSCS levies are calculated, fundamentally altered. For further information on the FSCS Funding Review, please refer to our Policy Statement PS07/19.

Why are there no Prudential Regulation Authority (PRA) or Pensions Guidance Service (PGS) fee-blocks to select?

The Prudential Regulation Authority fee-blocks and Pensions Guidance Service fee-blocks are related to the FCA fee-blocks. So, when you select an FCA fee-block in Section 3, the corresponding PRA and PGS fee-blocks will be shown on the calculation sheet.

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Section 4: Select Firm Options

Why can't I select some of the options shown with Section 4?

Some elements of Section 4 will not apply to all firms. The selections made within Sections 2 and 3 will determine which options are available. You will only have to complete those that are relevant in Section 4.

Section 4 is designed so that only the options that apply to the selections you made in previous sections will be relevant. If an option you believe applies to your firm is greyed out, you may not have selected the appropriate fee-blocks in Section 3. Changing the selected fee-blocks within Section 3 will alter the options available within Section 4.

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How do I know if an option affects my firm?

Help boxes are available for each of the options within Section 4. Hovering over the red text will provide a help box giving more detail of the particular option. Clicking on the red text will display a more detailed description of the relevant option. This will provide further detail of the particular option and clarify if it would apply to your firm.

For reference, the FS register provides a list of your firm's permissions and any associated limitations of regulated activity. The details on your firm in the FS register may help you understand which options apply to your firm.

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Section 5: Input Tariff Data

What does tariff data mean?

Tariff data is the information that is required to calculate your fees and levies. The fee calculator requires it to apply the relevant fee rates to the fee-blocks selected. Tariff data varies in its form depending on the fee-blocks you have highlighted within Section 3. Each fee-block is assigned a tariff base which describes the tariff data required for the associated fee-block.

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How do I know what tariff data to enter?

Each fee-block, sub-class & industry block has an associated tariff base. By hovering your cursor over the abbreviated tariff base (shown in red text), the full tariff base description is shown. Clicking on the relevant tariff base will display a detailed description of the data required for that fee block, sub-class or industry block to calculate your fees.

Firms that have already received a periodic fee invoice can use the invoice as a good reference point. The calculation sheet included with each invoice contains the tariff data used to calculate that particular fee. This is a good guide on what data to enter, and the same data can of course be used if you require a quick calculation.

Firms that have not yet received an invoice can use the help files associated with each tariff base as stated above.

If you do not enter any tariff data, the fees calculator cannot calculate a relevant fee. If your tariff data is zero, please enter 0. Do not enter negative figures or non-numerical characters.

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Calculation Sheet

How do I print my calculation results?

A printable version of the calculation sheet is available by clicking on the link shown on top of the calculation sheet. This will include which fee blocks, sub-classes and industry blocks you have selected and the tariff data entered. It will also provide detailed calculation breakdowns for each fee block, including any discounts and/or deductions that may apply.

Printable versions are available for the calculations of each separate organisation or for all organisations.

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