Interest payments to clients policy

It is the firm’s policy to pay clients interest on funds held on their behalf in clients account in accordance with Rule 7 of the SRA Account Rules.

The interest due (if any) will be calculated on completion of any client instruction / return of monies to clients and will be added to the balance due to the client.

Clients are unlikely to receive as much interest as might have been obtained had they held and invested the money themselves. The rate of interest we receive and are therefore able to pass on, can be lower than other investment rates available, and also lower the Bank of England base rate.

In the case of matters where we are holding funds long term, interest will be calculated on balances that are greater than £5000.00 twice annually to the Tax Year End (5th April) and to the 5th October. Interest will be calculated by the accounts department at the bank interest rate received on Harrington Law Limited instant access client account with the HSBC Bank, which as at 17th November 2023 is 1.95%.

In the event that the calculated total interest accruing to a client for the duration of a matter is less than £50.00 then no interest will be paid on the basis that it is a de minimis amount.

We believe this is a fair sum, as required by Rule 7 of the SRA Accounts Rules, as:

• The starting point should be the level of interest we receive from our bank, which is significantly different to, for example, the Bank of England Base Rate; and
• Offering a lesser rate than the rates paid by banks and not paying interest, unless it is calculated to be more than £50.00, takes into account the cost/time expended in managing the client account.

The interest rate and threshold for payment will be reviewed at regular intervals by Harrington Law Limited – usually April in each calendar year and when HSBC interest rates change.

We will only transfer funds to a designated deposit account on request, provided that, in the opinion of the Harrington Law Limited accounts department it is equitable to do so, taking into account amongst other factors, the administrative cost of doing so. If we do hold money in a separate designated deposit account on your behalf, we will account to you for all the interest earned on that account.

This policy will be reviewed periodically by the COFA to ensure over-riding objectives are met. Any changes will take immediate effect whether or not notified to clients.