J.P. Morgan Self Invested Personal Pension (SIPP) & SIPP Drawdown

Transcription

1 Key Features and Terms and Conditions J.P. Morgan Self Invested Personal Pension (SIPP) & SIPP Drawdown Effective from 6 April 2015 For J.P. Morgan WealthManager + Account holders

2 TABLE OF CONTENTS 3 KEY FEATURES 1 - J.P. Morgan SIPP 4 KEY FEATURES Questions and answers 9 12 KEY FEATURES 2 - J.P. Morgan SIPP - Drawdown Pension - Available to Existing J.P. Morgan SIPP Drawdown Clients Only KEY FEATURES Charges Schedule 15 TERMS AND CONDITIONS Part A - J.P. Morgan WealthManager + General Terms and Conditions 24 TERMS AND CONDITIONS Part B - J.P. Morgan Self Invested Personal Pension (SIPP) Specific Conditions 29 TERMS AND CONDITIONS Annex 1 - Data Privacy Policy 30 TERMS AND CONDITIONS Annex 2 - Order Execution Policy GETTING IN TOUCH + Visit our website + Call us on or Our UK-based Investor Service team is available Monday to Friday, 9am to 5.30pm. Our fax number is Write to us J.P. Morgan Asset Management Client Administration Centre 60 Victoria Embankment London EC4Y 0JP All our application forms are available to download online at or you can telephone us to request a copy. We cannot accept instructions from anyone else on your behalf except where permitted and all letters and fax instructions must include your account number and be signed. Telephone calls may be recorded for training and monitoring purposes. 2 KEY FEATURES

3 Key Features The Financial Conduct Authority is a financial services regulator. It requires us, J.P. Morgan Trustee & Administration Services Limited, to give you this important information to help you decide whether our J.P. Morgan Asset Management Self Invested Personal Pension ( J.P. Morgan SIPP ) and/or our J.P. Morgan Asset Management SIPP Drawdown Pension ( J.P. Morgan SIPP Drawdown ) is right for you. You should read this document carefully so that you understand what you are buying, and then keep it safe for future reference. If you have any questions please contact us using the details on page 2 of this document; or alternatively you may wish to speak to your financial adviser. 1. J.P. Morgan SIPP Its aims To provide a tax efficient way to save for your retirement. See What about tax? on page 6 for more information. In respect of the J.P. Morgan SIPP Drawdown, to allow to you to take an income from your pension fund, (known as a drawdown pension) while remaining invested. Please note the J.P. Morgan SIPP Drawdown is only available to existing J.P. Morgan SIPP Drawdown clients and who are already in drawdown prior to 5 April To provide you with the flexibility to choose whether and when to buy a guaranteed pension (known as an annuity). Please note in order to make withdrawals and/or take advantage of the below pension options, you will need to find an alternative pension provider who will be able to provide this service for you. Your commitment You should satisfy yourself that you understand the features and risks of the J.P. Morgan SIPP, so that you can decide whether it is likely to meet your investment objectives. To make a contribution or transfer payment, or have your employer or other third party make a contribution on your behalf. You may contribute whenever you wish, as long as you remain eligible to do so. See Who can invest? on page 4 for more information. You must satisfy our minimum investment requirements. See What are the minimum investment levels? on page 5 for more information. Normally to wait until you are 55 before taking your benefits. See When can I take my benefits? on page 7 for more information. From time to time to review the payments you make, the investments within your pension plan and the amount of any drawdown pension with your financial adviser to ensure your J.P. Morgan SIPP continues to meet your needs and, in the case of drawdown pension, complies with the relevant HMRC limits and review requirements. See Do I need to have a financial adviser on page 4 for more information. Risks When you open your J.P. Morgan SIPP If you are transferring from another pension scheme, there is no guarantee that the benefits we will pay will be greater than the benefits you are giving up. See Can I transfer in benefits from another pension plan? on page 5 for more information. Stakeholder pensions are generally available and could meet your needs as well as a J.P. Morgan SIPP. Please note we do not offer a stakeholder pension. If you change your mind and cancel your J.P. Morgan SIPP, you may get back less than you paid in. See Can I change my mind? on page 5 for more information. The tax advantages of investing in a SIPP depend on your current circumstances, which may change in the future. The government may change the way SIPPs and investments are taxed, which may be less favourable to you. If you exceed the contribution limits you may incur a tax penalty. Our charges may change in the future which may reduce your pension fund. Investments The value of your investment and the income from it is not guaranteed and can fall as well as rise. Past performance is not a guide to future returns and when you sell your investments you may get back less than you originally invested. Taking an income (Drawdown Pension) (available to existing J.P. Morgan SIPP Drawdown clients only and who are already in drawdown prior to 5 April 2015) See page 9 for details of the risks involved with taking a Drawdown Pension. Buying a pension (annuity) The value of your pension may be lower than shown on your illustration, for example if: - Investment performance is lower than expected. - The cost of buying an annuity is higher than illustrated, for example interest rates have fallen. - You stop or reduce your contributions. - Tax rules and legislation change. - You take a pension earlier than the age you ask us to use in our illustration. - You decide to take a level of income higher than we have illustrated. KEY FEATURES 3

4 Questions and answers What is the J.P. Morgan WealthManager + Account? The J.P. Morgan WealthManager+ Account (your Account) allows you to invest online, by postal application and over the telephone. We also provide you with education pieces to help you understand your financial goals. You can visit our website or contact us for more information. What is the J.P. Morgan SIPP? The J.P. Morgan SIPP is a pension plan which allows you to save for your retirement in a tax efficient way. You can make your own investment decisions and decide how and when you take your benefits. When you open your pension plan you will become a member of the J.P. Morgan Self Invested Personal Pension Scheme (the scheme ). The scheme was established by J.P. Morgan Trustee & Administration Services Limited, which also acts as the scheme trustee and scheme administrator. See About us and compensation on page 10 for more information about J.P. Morgan Trustee & Administration Services Limited. From 6 April 2015, the J.P. Morgan SIPP will be an accumulation only arrangement. There will no longer be an option to withdraw any lump sum payments and/or income from your SIPP. We will, however, continue to administer the J.P. Morgan SIPP Drawdown offering if you set up the drawdown option before 5 April If you wish to take advantage of the new options for pensions, you will therefore need to find an alternative pension provider. In this event, we strongly recommend that you consult a professional financial adviser. Is this a stakeholder pension? No. Where a stakeholder pension is available it may meet your needs as well as this plan. Your financial adviser will be able to advise you which pension plan is better for you. What is the J.P. Morgan WealthManager + Cash Account? When you open your Account we will automatically open a Cash Account for you. You can use your Cash Account to hold money pending investment into your plan. Please note that the Cash Account is not a bank account. Who can invest? The J.P. Morgan SIPP is available to individuals who are aged 18 or over and are a UK resident. You can also open a J.P. Morgan SIPP for a child by completing a legal guardian declaration form. We will treat you as if you were the member of the scheme until the child is age 18 and you will be responsible for the operation of the plan, including ensuring that the contribution limits are not exceeded. You must also not be a US person. You can find an explanation of what a UK resident and a US person is in our terms and conditions. Do I need to have a financial adviser? No. You do not need to have a financial adviser to open an Account. However we will always carry out your instructions to buy and sell investments on an execution-only basis, and we will not assess the appropriateness or suitability of any investment. If you have any doubts about whether an investment is suitable for you, you should speak to a financial adviser. You can find one in your area by going to If you have a financial adviser they can have online access to view your Account including all the relevant documents within your personal document library. Please note we are unable to take instructions from your financial adviser in relation to your Account or facilitate the payment of any fee you have agreed to pay them from your Account. How much can be paid into my J.P. Morgan SIPP? There is no limit to how much can be paid into to your pension plans. However HMRC has set a limit on how much tax relief you can receive on those contributions. Provided you are a relevant UK individual, you will receive tax relief on personal contributions that do not exceed the greater of: The basic amount of 3,600 gross, regardless of your earnings (or if you have no earnings); or Your relevant UK earnings for the tax year. Please note: The above limits apply to all contributions made by you and any third party, excluding your employer, to all your registered pension schemes. Employer contributions are not subject to the limites above, but they are subject to the annual allowance limit (please see below).lif all contributions made by you and any third party, including your employer, to your registered pension schemes in any tax year exceed the annual allowance you may have to pay a tax charge. See What about tax? on page 6 for more information on the annual allowance. Relevant UK earnings are your taxable annual income including any bonuses, commission, or benefits in kind that you receive from your employment, or self employment. You re a relevant UK individual in any one tax year if: You are resident in the UK for tax purposes, or You have relevant UK earnings, or You were a UK resident sometime in the previous five years and when you joined the scheme, or You have, or your spouse or civil partner has, earnings from overseas Crown employment subject to UK tax. Please note we accept payments into your SIPP in pounds sterling only. How do my contributions receive tax relief? You and any third party (excluding your employer) should make contributions to your SIPP after deducting an amount equal to basic rate tax. We will then add an amount equal to the tax deducted to the contribution and invest this into your plan. The tax amount added is then reclaimed by us from HMRC. For example, if you want to make a contribution of 100, you pay only 80. We add the 20 deducted and invest 100 into your plan. We then reclaim 20 from HMRC. If you are a higher rate or additional rate taxpayer, you can reclaim any further tax relief entitlement though your tax return. See What about tax? on page 6 for more information. What investments are available? You can invest in the following investments: J.P. Morgan Investment Trusts J.P. Morgan Open Ended Investment Companies (OEICs) Shares in the 100 biggest companies on the London Stock Exchange - excluding non-jp Morgan investment trusts ('FTSE TM 100 Equities') (available to existing holders only). What are investment trusts and OEICs? Investment trusts An investment trust is a public company, listed on a stock exchange that invests in other companies to make money for its shareholders. You should 4 KEY FEATURES

5 refer to the relevant J.P. Morgan Investment Trust profile or report and accounts before investing. OEICs OEICs are funds which have the structure of a company and use the pooled money of their shareholders to invest in a range of investments which are set out in each fund s objectives. You should refer to the fund s Key Investor Information Document (KIID) and prospectus for more information. What are the minimum investment levels? The minimum lump sum you can invest is 500 per investment. The minimum you can invest to top up an existing investment is 100. The minimum regular savings contribution is 50 per investment. The minimum balance permitted in your J.P. Morgan SIPP is 500. How do I invest? You can invest either a lump sum or make regular investments, or a combination of both. Lump sum investing You can make lump sum investments: Online by debit card, direct debit or cheque; or By post. Simply complete an application form and return it to us with your cheque; or Phone us and invest using your debit card. Regular contributions You can invest regular contributions by monthly, quarterly, half-yearly or yearly direct debit. You can set up your direct debit online or by completing and sending us an application form and a direct debit mandate. We collect direct debits on the 1st or 16th of the month (or next business day) and you must set up your regular contribution payments at least nine business days before the first contribution date. Please note that in some circumstances we may ask you to provide a cheque for the first payment. You can also: Edit the existing investment instruction for your next contribution up to three business days before the contribution date; and Edit the payment collection of, and/or cancel, your next contribution up to nine days before the next contribution date. Any changes to, or cancellation of, contributions outside the above time limits will take effect on the next scheduled contribution date. What are the charges? The different types of charges that are applicable to your Account are set out on page 12. How are charges collected? Transaction charges We take transaction charges directly from your lump sum or regular contribution which will reduce the amount invested. Annual Account charge We will take our annual Account charge (if applicable) from your SIPP cash facility. If you do not have enough cash in your SIPP cash facility we will sell investments within your Account (chosen by us) equal to the value of the charge you owe us plus an extra 5% to account for any market movements. You will also have to pay our associated transaction costs. We will normally do this in June and December. You can make sure you have enough money in your SIPP cash facility to pay our charges by topping up your cash facility online or by sending us a cheque before a charge is due. Any monies paid in counts towards your annual allowance. We will also always take any charges you owe us before we pay you the proceeds of any investment sales, or carry out any investment purchase or pay or reinvest any income, or transfer any investments to another SIPP provider. Can I change my mind? After I have subscribed to my J.P. Morgan SIPP If you open a J.P. Morgan SIPP and you change your mind, you may cancel within 30 days of receiving the cancellation notice that we will send you. We will give you your original investment back, less any fall in the value of your plan. We will also refund any charges made by us. If you decide not to cancel your plan will continue in force in accordance with the J.P. Morgan WealthManager + Terms and Conditions. After I have transferred an existing SIPP to my J.P. Morgan SIPP If you transfer an existing pension plan into your SIPP you may withdraw your application at any time during the fourteen (14) day cooling-off period, which starts the day we receive your transfer instruction. Can I transfer in benefits from another pension scheme? Yes. You can transfer an existing pension plan from other registered pensions into your SIPP either online or by completing a transfer form and returning it to us. Please note there are certain transfers-in we cannot accept and you can find details of them in our terms and conditions. We can accept transfer values in cash. We can also accept in-specie transfers (where you can transfer in investments in their current form without having to sell them) in respect of those funds and securities that are currently available for new investment within your SIPP. The minimum value we can accept into the accumulation part of your SIPP (i.e. the part of your pension plan that is still invested) is 5,000. Before you transfer-in an existing pension you should speak to your financial adviser about whether transferring-in is right for you. You should also think about such things as: Can our SIPP match the level of benefits you are giving up? If you decide to cancel the transfer you may not be able to transfer back into the original pension scheme. The lack of exposure to potential market growth while the transfer is taking place, market fluctuations and any exit changes may have an impact on the transfer value. If you are aged 75 or over and transfer in from another pension scheme you will not be able to make additional contributions to your plan. You will not receive any tax relief on the transfer. How long will a transfer-in take? Under normal circumstances a transfer-in takes around 4-6 weeks to complete. Please note that for part of this time the funds you are transferring-in will be uninvested ( out of the market ). Can I transfer my J.P. Morgan SIPP to another pension scheme? Yes. You can transfer the value of your pension fund to another UK registered pension scheme or to a qualifying recognised overseas pension scheme at any time. You can transfer your pension fund either as a cash payment or you can transfer your investments in their existing form (known KEY FEATURES 5

6 as an in specie transfer), but this depends on your new pension provider s rules. You should speak to your financial adviser about whether transferring-out is right for you. You should also bear in minding the following: The amount transferred may be less than the contributions to your plan, due to investment performance and the effect of our charges. There may be charges relating to the selling and re-registering of the underlying investments. How long will a transfer-out take? Under normal circumstances a transfer-out normally takes around 4-6 weeks to complete. Please note that for part of this time the funds you are transferring-out will be uninvested. What about tax? The information set out below is a simplified summary based on our understanding of current law and HMRC practice, which may change. Future changes in law and tax practice, or your own financial circumstances, could affect your pension or how much tax you have to pay. Your financial adviser can give you more information about your tax position. Tax relief pension payments Subject to your annual allowance (please see below), all payments (other than your employer s payments) are made net of basic rate tax and we will reclaim this amount of tax from HMRC. You must tell us within 30 days if anything happens which affects your entitlement to tax relief. If you are a higher or additional rate tax payer, you can claim your extra tax relief through your tax return. Your employer s contributions, if applicable, are received gross. Employer contributions paid into the J.P. Morgan SIPP cannot be refunded unless you cancel your SIPP within the cancellatoin period. You don t get tax relief for any money you transfer into your pension plan from another scheme. There is no tax relief available on any payments you make after age 75. Annual allowance HMRC has set a limit on how much can be paid into all your registered pensions in any one tax year by you and any third party, including your employer, on your behalf (known as the annual allowance) and on which tax relief can be granted. The annual allowance is 40,000 from 2014/15 onwards unless you choose to access your pension using flexi-access drawdown (which is not available within the J.P. Morgan SIPP but may be available from alternate providers) for more information, including how this would affect your annual allowance please see the section entitled Flexi-access drawdown, below at page 7. If the total payments that you, your employer and any third party make to all your pension plans (excluding transfer payments) exceeds the annual allowance the excess will be taxed at the highest rate you pay, effectively removing all tax relief from the excess amount. Unused annual allowance from the three previous tax years can normally be carried forward to allow you to contribute more than the annual allowance in the current tax year. However please note: You must have been a member of a UK registered pension scheme in the tax year from which any unused allowance is being carried forward. You will have no unused annual allowance to carry forward for a tax year in which your relevant UK earnings are less than the basic amount (currently 3,600). Lifetime Allowance HMRC has a lifetime allowance on the total funds in pension plans that can be used to provide benefits to you. The lifetime allowance is currently 1.25 million with effect from the 2014/15 tax year and will reduce to 1million with effect from the 2016/2017 tax year. If you registered for primary or enhanced protection with HMRC before 6 April 2009, or for fixed protection before 6 April 2012, or for fixed protection 2014 before 5 April 2014, or individual protection before 6 April 2017 then you may have a higher personal allowance or the lifetime allowance may not apply. Speak to your financial adviser for more information about this. Please note: If you have any form of protection you must provide us with your HMRC protection certificate. If you wish to rely on enhanced or fixed protection you cannot make any additional contributions to your pension fund. Your lifetime allowance does not restrict the total amount you can hold in your pension plans, but does restrict the amount that is tax privileged. This means that if you exceed the lifetime allowance and you do not have any of the forms of protection mentioned above the excess will be subject to a tax charge when you take your benefits as follows: If you take your benefits as income the excess charge is 25% on the excess in addition to income tax; or If you take your benefits as a cash sum the charge is 55% on the excess. Your pension fund will be tested against the lifetime allowance when you take benefits before age 75 and regardless of whether you have started to draw benefits, at age 75. Capital Gains Tax Any sales of investments held in your pension plan do not generally attract capital gains tax. Income tax Income you take from a drawdown pension or an annuity will be taxed as earned income under normal pay-as-you-earn (PAYE) rules. There is no income tax payable on investments held in your plan, although any dividends are received with a tax credit which cannot be reclaimed. How will I know how my investments are performing? You can keep up to date on the progress of your investments. You will also receive statements with details of your J.P. Morgan SIPP as at April and October, showing all transactions over the previous six months. You can also opt to receive our online paperless service. You can change your preference at any time. If you opt for our paperless service we will send you an whenever we put a document in your document library. However, we will continue to send some documents to you by post when required for regulatory or security reasons. Every year we will also provide you with a statutory money purchase illustration; a drawdown pension illustration; and a pension savings statement. You can also request a valuation statement, at any time, online or by contacting us. Factsheets, Key Investor Information Documents and annual reports for the J.P. Morgan OEICs and investment trusts can be viewed on our website. Prices are also quoted daily in the Financial Times and other broadsheet newspapers. 6 KEY FEATURES

7 Can I change the investments within my SIPP? Yes. You can sell your investments and invest the proceeds into any of the other investments available within the J.P. Morgan SIPP. The process and timescales involved will depend on whether you are switching investments within your SIPP or moving them from your ISA/Investment Account to your SIPP. The value of your SIPP, and the number of shares you hold, may change during the process. Switching Investments within your SIPP If you transact on your Account online, you can switch online between any investments. Depending on the investments and the timing of the transactions, this process will generally take place on the same business day or over two business days. If you transact on your Account by post or telephone, you can switch between by sending or faxing a signed written instruction with your Account number to us or by calling us. Depending on the investments and the timing of the transactions, this one or two business days following the business day we receive your instruction. Moving your investments from your Investment Account/ISA to your SIPP You can sell the investments within your ISA/Investment Account and use the cash proceeds to invest in your SIPP. Please note that switching investments may result in you being temporarily uninvested and be subject to a tax charge. What happens to the income from the investments within my pension plan? If your pension plan holds investments that make dividend or interest payments, you can choose to have these reinvested into the same investment or to have the income paid into your SIPP cash facility. You can specify your income preference when you open your SIPP online or on your application form. You can select different income preferences for each arrangement/sub-account within your SIPP and you can update these either online or by contacting us. Please note that while the income earned on the investments within your plan is tax free HMRC does not treat the income as a contribution to your plan and you will not receive tax relief. Will I receive interest on cash held in my J.P. Morgan SIPP? You can find details of the interest we pay on our website or by contacting us. When due, interest is paid monthly on your Account. How do I sell the investments within my SIPP? You can sell your investments online or you can instruct us to sell your investments by writing to us, or by phone or by fax. How long will it take before I can reinvest investment sales proceeds within my SIPP? Investment sale proceeds will be available for reinvestment within your SIPP on the settlement date, (which is usually four business days after the date you sell your investments). When can I take my benefits? You can normally choose to take benefits from your plan from age 55 and you do not have to stop working to take benefits. However in certain circumstances, such as serious ill health or where you have a protected pension age, you may be able to take your pension earlier. How can I take my benefits? Please note in order to make withdrawals and/or take advantage of the below pension options, you will need to find an alternative pension provider who will be able to provide this service for you. We will, however, continue to offer a drawdown pension service for investors holding a drawdown pension with us at 6 April If you currently hold a drawdown pension with us and you wish to convert into a flexi-access drawdown pension, you will need to find an alternative pension provider who will be able to provide this service for you. You can: buy an annuity (not available within the J.P. Morgan SIPP but this option may be available from alternate providers); take a flexi-access drawdown (not available within the J.P. Morgan SIPP but this option may be available from alternate providers); take an uncrystallised pension lump sum (not available within the J.P. Morgan SIPP but this option may be available from alternate providers); take a combination of an annuity or flexi-access pension (not available within the J.P. Morgan SIPP but this option may be available from alternate providers). Buying an annuity An annuity is a product that gives you an income as long as you live and can be purchased from any provider in the market (known as the open market option). Once you have bought an annuity you will have 30 days to change your mind, but not thereafter. You should speak to your financial adviser about whether buying an annuity is right for you. Before buying an annuity you should also bear in mind the following: The points mentioned in Buying a pension (annuity) in Risks on page 3. You may want to provide an income for your dependants when you die, or have an income that increases each year during your retirement. If so, these options will reduce the initial level of your pension. An annuity provides the certainty and security of a guaranteed income. Normally the older you are, or if you have a particular type of ailment when you purchase your annuity, the greater the level of income you will receive. Flexi-access drawdown Flexi-access Drawdown (FAD) allows individuals to take 25% as a tax free lump sum when first moving into FAD and take the remainder of the funds as taxable income with no upper limit. Taking an income under flexi-access will trigger the money purchase annual allowance (MPAA) which restricts the annual allowance from 40,000 to 10,000. Taking your tax free lump sum only will not trigger the MPAA. Uncrystallised pension lump sum Uncrystallised pension lump sum refers to a lump sum which is payable from pension assets which have not yet been used to pay a scheme pension, purchase an annuity, or designated to a FAD or other drawdown scheme. Uncrystallised funds pension lump sum allows individuals to take 25% as a tax free lump sum and the remainder will be taxable as pension income. Taking your tax free lump sum will trigger the MPAA. We recommend you seek independent financial advice regarding your investment choices and retirement options. If you do not have a financial adviser you may wish to use the Money Advice Service which can help you by providing unbiased advice and will give you guidance on how to choose an adviser if you wish to do so. KEY FEATURES 7

8 Furthermore, a new government service called Pension Wise will enable you to receive free, impartial guidance. This service will offer you tailored guidance (online, over the telephone or face to face) to explain what options you have and to help you think about how to make the best use of your pension savings. You can also receive information about the tax implications or different options and tips on getting the best deal, including how to shop around. More information on this service can be found at Take a drawdown pension A drawdown pension allows you to take your benefits from your plan while remaining invested. See the Key Features for the J.P. Morgan Adviser Solutions SIPP Drawdown Pension for details of the benefits available under a Drawdown Pension. Please note the J.P. Morgan SIPP Drawdown is only available to existing J.P. Morgan SIPP Drawdown clients and who are already in drawdown prior to 5 April What happens to my SIPP when I die? If you die under the age of 75 If you are under age 75 the value of your pension fund will normally be paid to your nominated beneficiaries as a tax- free cash sum up to the value of the remaining lifetime allowance, or if you have one, your protected personal allowance. Alternatively, if the nominated beneficiary is your spouse/civil partner/dependants they may use your pension fund to buy an annuity or another form of benefit, but any income will be subject to income tax in the normal way. If you are diagnosed with a terminal illness different rules may apply. Speak to your financial adviser for further information. If you die over the aqe of 75 If you are age 75 or over at the date of your death any cash sum payment is subject to a 45% tax charge until 5 April2016. After this date, any tax applied is subject to the nominated beneficiary s marginal tax rate. Annuity If you die after buying an annuity any death benefits payable to your spouse/civil partner/dependants depend on the terms and conditions of the annuity. 8 KEY FEATURES

9 2. J.P. Morgan SIPP - Drawdown Pension Available to Existing J.P. Morgan SIPP Drawdown Clients Only Its aims To allow you to take an income from your pension fund, while remaining invested. To provide benefits to your dependants when you die. Please note the J.P. Morgan SIPP Drawdown is only available to existing J.P. Morgan SIPP Drawdown clients and who are already in drawdown prior to 5 April 2015 Your commitment To choose a level of drawdown pension within the limits set by HM Revenue and Customs (HMRC). To regularly review the investment strategy of your drawdown pension with your financial adviser to ensure it is on track to meet your future financial needs. Risks The amount of income you can take under a drawdown pension depends on a number of factors, including how well your investments have performed and the current HMRC rules in force. See What are my drawdown pension options? below for more information. The amount of your pension fund available to use as drawdown pension may be different than shown in your illustration. Taking an income will erode the value of your pension fund, especially if investment returns are less than expected and a high level of income is taken. As your pension fund remains invested it will continue to be exposed to investment risks. You should speak to your financial adviser for more information about these. You should also bear in mind: - The value of investments and the income from them is not guaranteed and can fall as well as rise. - Past performance is not a guide to future returns. - When investments within your plan are sold, you may get back less than you originally invested. Annuity rates can change substantially over a short period of time, both up and down. So if you decide to subsequently purchase an annuity, the rates available could be less than if you had bought an annuity earlier. Questions and answers How can I take my Drawdown Pension? You can only take your J.P. Morgan SIPP Drawdown pension if you set it up prior to 5 April If you are not in drawdown then you are not permitted to go into drawdown with us. A drawdown pension lets you take an income while allowing you to keep your plan invested, so you can continue to change the investments within your plan. Your income will be taxed through the PAYE system as pension income. The maximum level of income that you can withdraw is set by the Government s Actuary Department (known as the GAD rate) and depends on your age and the returns of UK government securities. You can also choose not to take any income from your drawdown pension or make one-off lump sum withdrawals. We will recalculate the limits that apply to you every three years up to age 75 and every year after age 75. The maximum amount of income you re allowed to take out each year could reduce as a result of this recalculation. Where can I find details of charges relating to my drawdown pension? We make no additional charges over and above the charges that apply to your SIPP. Details of all charges relating to your SIPP are set out in the Charges Schedule on page 12. What about tax? The investments held in your drawdown pension are free from UK income tax and capital gains tax. Drawdown pension income payments to you are treated as earned income and taxed under the PAYE system. There is a maximum value of retirement benefits that you can receive from all your pension plans without being subject to a tax charge. This is your lifetime allowance and is currently 1.25 million for the 2014/15 tax year onwards. You can find more information about the lifetime allowance in the Key Features of the J.P. Morgan SIPP. Up until you reach age 75 we will check whether you have exceeded your lifetime allowance each time you take a drawdown pension from a part of your SIPP and also when you reach age 75 whether or not you have taken any benefits under your plan. If the lifetime allowance is exceeded there will be a tax charge, known as the lifetime allowance charge. Please see our Terms and Conditions for further information. Any cash sum death benefits payable from a drawdown pension will be tax free if you are aged under 75 up to the value of your lifetime allowance or your personal protected allowance (if applicable). If you are aged over 75, this will be taxed at 45% up until 5 April This will then be taxed at your nominated beneficiary s marginal tax rate. This is normally paid free of inheritance tax. The tax treatment and tax benefits of your drawdown pension outlined in this document are based on our understanding of current tax law and may be subject to change without notice. Please speak to your financial adviser if you have any further questions about tax. When can I buy an annuity? You can buy an annuity at any time from age 55 and whether or not you are taking a drawdown pension from your plan. You can find more information about annuities in the Key Features of the J.P Morgan SIPP, or you can speak to your financial adviser. How do I know how the investments within my drawdown pension are performing? If you manage your drawdown pension online you can view your investments online together with all the other investment documentation and statements we make available in the online document library. We will also send you a statement each October and April showing all the transactions for the previous six months. We will also send you an annual drawdown illustration and write to you every 3 years to age 75 and annually after age 75, with details of any changes to the maximum income limit set by HMRC. KEY FEATURES 9

10 Can I make extra contributions to my J.P. Morgan SIPP - Drawdown Pension? No. You cannot make additional contributions into your J.P. Morgan SIPP Drawdown Pension. However, you can continue to make contributions into your SIPP. Please note that any contributions made after age 75 are not entitled to tax relief. If your pension plan is protected against the lifetime allowance limit, making extra contributions will result in the loss of this protection. Can I transfer an existing SIPP drawdown pension into my J.P. Morgan SIPP - Drawdown Pension? No. Any drawdown accounts which are transferred in from other providers exist as a separate SIPP arrangement within your WealthManager+ account. As of 6 April 2015 income drawdown is no longer a retirement option and we therefore cannot service these additional arrangements, or accept a transfer in of a drawdown account. What happens to my J.P. Morgan SIPP - Drawdown Pension when I die? If you die while taking income from your pension fund, your spouse/civil partner/dependants can: Buy an annuity. Continue with taking an income from the pension in the form of the new flexible retirement options with an alternative provider. Together with any other nominated beneficiaries, take the remaining pension fund as a cash sum, tax free under the age of 75. If you have no surviving beneficiaries or other nominated beneficiaries we will pay any remaining pension fund as a cash sum, tax free under 75. Can I transfer my drawdown pension to another pension plan? Subject to any conditions of the new pension provider you can transfer all of the drawdown pensions within your SIPP to another UK registered pension scheme or Qualifying Recognised Overseas Pension Scheme (QROPS). A QROPS is a pension scheme based outside the UK to which HMRC will allow you to transfer assets without imposing a tax charge. The transfer can be in cash or you can transfer the investments in their current form (in-specie), but this will depend on your new pension provider s rules. We will always make the transfer to the trustee or scheme administrator of your new plan. 10 KEY FEATURES

11 Other information about the SIPP and SIPP Drawdown Pension How to contact us Our contact details are set out on page 2. How to complain We are committed to providing you with a first class service. If anything does go wrong, we try to put it right quickly and efficiently. If we cannot resolve a problem immediately, we will contact you to tell you what we are doing about it. If you wish to complain about any aspect of our service, please contact us using any of the details set out on page 2. If we do not deal with your complaint to your satisfaction, you may refer it to: Financial Ombudsman Service Exchange Tower London E14 9SR Telephone: complaint.info@financial-ombudsman.org.uk About us and compensation J.P. Morgan Trustee & Administration Services Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Register under number Your J.P. Morgan SIPP and SIPP Drawdown Pension are covered by the Financial Services Compensation Scheme. If we cannot meet our obligations to you, you may be entitled to compensation from the scheme. The level of compensation will depend on the type of business and the circumstances of your claim. Most types of investment business are covered up to a maximum of 50,000. Further details are available from: Financial Services Compensation Scheme 10th Floor Beaufort House 15 St Botolph Street London EC3A 7QU This does not prejudice your right to take legal proceedings. A summary of our complaints process is available on request. Terms and conditions This Key Features Document provides a summary of your J.P. Morgan SIPP and SIPP Drawdown Pension. It does not contain all the definitions, exclusions, and terms and conditions relating to them. These are set out in the J.P. Morgan WealthManager + Terms and Conditions. Law and language Your Account is governed by the law of England and Wales and any matters arising under them will be subject to the exclusive jurisdiction of the courts of England and Wales. The J.P. Morgan WealthManager + Terms and Conditions are in English as will be all future communication between us. KEY FEATURES 11

12 Charges Schedule The charges you pay depend on the products you have and the investments you hold within them. The following charges apply: Annual Account Charge We charge an Annual Account Charge for holding J.P. Morgan Investment Trusts within your J.P. Morgan ISA as follows: Amount Minimum Maximum 0.25% of value of investment 2 per month 10 per month The maximum total Annual Account Charge you will pay is therefore 120 per annum. Transaction charges The following charges apply when you place instructions on J.P. Morgan Investment Trusts: Charge Amount Applies to Brokerage charge * 10 per individual investment Buy and sell UK Stamp Duty Reserve Tax 0.5% value of investments Buy only Panel of Takeover and Mergers (PTM) Levy 1 per investment purchase if greater than 10,000 Buy only * We will not charge a brokerage fee when you buy a J.P. Morgan Investment Trust as part of a switch within a product; or if you make regular contributions or dividend reinvestments into J.P. Morgan Investment Trusts. Please note that other taxes and costs may exist that are not paid via us or imposed by us. Additional information We do not charge you for: - Holding J.P. Morgan OEICs or cash within your account; - Holding J.P. Morgan Investment Trusts within your J.P. Morgan Investment Account - Buying or selling J.P. Morgan OEICs; - Sending us cash; or - Transferring investments to us or from us to another provider. Please note that other taxes and costs may exist that are not paid via us or imposed by us. You can find details of how we collect our charges in clause 20 on page 21 of the J.P. Morgan WealthManager + Terms and Conditions.. 12 KEY FEATURES

13 TABLE OF CONTENTS J.P. MORGAN WEALTHMANAGER + ACCOUNT TERMS AND CONDITIONS (INCLUDING SIPP SPECIFIC CONDITIONS) 15 PART A J.P. MORGAN WEALTHMANAGER + GENERAL TERMS AND CONDITIONS 1. Introduction 2. Reading our terms and conditions 3. Anti-Money Laundering and Identity Verification 4. Opening your Account Nominated Bank Account 6. Joint Accounts 7. Your right to change your mind 8. Investing into your Account 9. How we deal with your cash 10. Giving us instructions Buying and selling investments ( dealing Instructions ) Dividends and distributions 13. Withdrawals and payments to third parties 14. Keeping you informed 15. Shareholder information, meetings and voting 16. Corporate Actions Protecting your investments and cash 18. Your responsibilities in respect of your investments 19. Online access Our charges 21. Liability and risk 22. Protecting your personal information 23. Communications Complaints 25. Termination and payments to you on the closure of your Account 26. In the event of your death TERMS AND CONDITIONS 13

14 Third party claims 28. Changing or replacing our terms and conditions 29. Events outside our reasonable control 30. Conflicts of interest 31. The Financial Services Compensation Scheme Governing Law 33. General provisions 24 PART B J.P. MORGAN SELF INVESTED PERSONAL PENSION (SIPP) SPECIFIC CONDITIONS 29 Annex 1 - Data Privacy Policy 30 Annex 2 - Order Execution Policy 14 TERMS AND CONDITIONS

15 Part A - J.P. Morgan WealthManager + General Terms and Conditions 1 Introduction 1.1 The J.P. Morgan WealthManager + Terms and Conditions are made up of the general terms and conditions (the General Terms and Conditions) which apply to all our products and additional specific conditions which apply to your particular products. Our terms and conditions, the application forms you complete and our Key Features Documents together make up your agreement with J.P. Morgan Trustee & Administration Services Limited (our, us and we in these terms and conditions) for the services it provides to you. Please read all these documents carefully because we will rely on them in all our dealings with you and then keep them safe for future reference. Please contact us if there is anything you don t understand. You can find our contact details on page We will treat you as a retail client which means you will have the highest level of protection under the rules made by the Financial Conduct Authority (the FCA Rules). When we refer to the FCA and the FCA Rules we also mean its successor regulator and the rules it may make to regulate our business. 1.3 In our terms and conditions whenever we are required to exercise our discretion, make a decision or ask you for information, we will act reasonably and in a way that treats you and our other clients fairly. 2 Reading our terms and conditions 2.1 Some words and phrases have a technical meaning. They appear in bold when first used and if the meaning is not obvious, we provide a separate explanation of what they mean. 2.2 Please also bear in mind the following when reading our terms and conditions: (a) Whenever we refer to any particular legislation, we also mean any amendment or replacement to it and any or other legislation, orders or provisions made under it. (b) Whenever we use words and expressions like including, for example, in particular, such as we use them by way of illustration or emphasis only, and they do not limit the general meaning of any preceding wording. 3 Anti-Money Laundering and Identity Verification 3.1 As a company conducting investment business we are required to comply with all applicable money laundering requirements, and in particular the Money Laundering Regulations 2007 (the Regulations ). Our responsibility for compliance with the Regulations, including but not limited to, verifying the identity and address of our investors, is based on the guidance issued by the Joint Money Laundering Steering Group, as amended from time to time. 3.2 Should we need to verify your identity we may use a reference agency (this should not affect your credit rating) and may need to contact you to obtain further information and/or documentation about you, which may result in a delay in the processing of your instructions or in making any payments to you. Until satisfactory proof of identity is provided, we reserve the right to refuse to process your instructions or make any payment to you. Any cash will be held in a client money account. We will not be held responsible for any losses caused by any delay in implementing an accepted application while establishing your identity, unless such delay is caused by our negligence. 3.3 Payments to third parties will only be made at our discretion. Evidence of identity of such third parties must be provided with the sale instruction. Normally we only make third party payments to personal or legal representatives into an appropriate bank account. Evidence of identity will need to be provided in such format that we may reasonably require. Until satisfactory proof of identity is provided of such third parties, we reserve the right to refuse to process any instruction that we have been given. or make any payment. 3.4 If you change address, we reserve the right to request original or certified identification documents that verify your new address details as well as your identity, as appropriate. 3.5 To prevent financial crime, your details may be passed to governmental, regulatory or other bodies as required by law. 4 Opening your Account Our eligibility requirements 4.1 To open your J.P. Morgan WealthManager + Account (your Account) you must apply for one or more of the products available. Our products are only available to individuals who are aged eighteen (18) (subject to clause 4.3 below) and over and who are UK residents. The UK is made up of England, Wales, Scotland and Northern Ireland, but not the Isle of Man or the Channel Islands. UK residents are individuals who are resident in the UK for tax purposes or if they are not resident, they perform duties as crown employees serving overseas, or are married to, or in a civil partnership with, a person who performs such duties. 4.2 Due to regulatory and tax complexities we cannot accept applications from non-uk Residents or US Persons. Please contact us if you think you may be a US Person. A US Person is an individual person who is a US citizen or a US tax resident of the United States. 4.3 You can open a Junior ISA for a child under eighteen (18) and if you are between sixteen (16) and eighteen (18) you can open a Junior ISA in your own name. Please see the Junior ISA Specific Conditions for more information. 4.4 You can open an Investment Account and designate it to be for the benefit of a child. You will remain the beneficial owner of all the assets within the Investment Account and will also be responsible to us for ensuring the Account is operated in accordance with our terms and conditions. If you move abroad or become a US Person 4.5 You must notify us as soon as reasonably possible if you move abroad or become a US Person. Please note that in such situations we may require you to provide us with such documentation as we may reasonably require. 4.6 If you do move abroad or become a US Person we will no longer accept any further investments into your products. Furthermore, if, after giving you thirty (30) days notice, you continue to hold investments in your products we may sell or transfer to another provider the investments and close your Account. You should also be aware that you may not be able to switch between investments and may be restricted as to the type of investments you can continue to hold within your Account. For example we may refuse to accept any further contributions into your ISA. You should speak to your tax/financial adviser about the possible tax implications of moving abroad or becoming a US Person. 4.7 If we reasonably believe that you are no longer permitted to hold particular investments or that we are unable to provide any of our products to you either because you have moved abroad or become a TERMS AND CONDITIONS 15

16 US Person, we may sell the investments and close your Account. We will do all we reasonably can to contact you before we do, so that we can discuss your options with you. Please see clause 18 which sets out your responsibilities in respect of your investments. Generally 4.8 After we have opened your Account and for each product we subsequently open for you, we will send you a letter confirming this. You must contact us as soon as possible or at least within fourteen (14) days if any of the details set out in the letter are incorrect. 4.9 We may reject any application you submit to us where we have reasonable grounds for doing so and we will not obliged to give you any reasons if we do so. 5 Nominated Bank Account If you wish to take income or withdrawals from your Account you must nominate a UK bank or building society account of which you are a named holder to be your Nominated Bank Account. Please note we will make all payments from your Account into your Nominated Bank Account. You can ask us at any time to change your Nominated Bank Account details but our agreeing to do so is subject to the results of any checks we may have to carry out in accordance with clause 3. 6 Joint Accounts 6.1 You can, together with up to five (5) other individuals, open a joint Investment Account. We will treat you and the other individuals as its joint owners. Each joint owner is responsible for all of the obligations imposed on an Account holder by our terms and conditions both individually and together. This means that each joint owner may be responsible to us for any loss we suffer as a result of a breach of our terms and conditions by one of the other joint owners, even if that individual did not cause the breach. 6.2 We will send the first named Account holder a letter confirming that a joint Investment Account has been opened. Any instructions we receive from any Account holder relating to the Account will be binding on all joint owners. Please note we may require all Account holders signatures before we carry out certain instructions. 7 Your right to change your mind We have set out in the product Key Features Documents full details of your cancellation rights relating to each product. 8 Investing into your Account Lump sum investments 8.1 You can make lump sum investments by cheque, debit card or direct debit. You should be aware that if you make an ad hoc lump sum payment using your existing direct debit mandate it will take at least three (3) Business Days before the payment reaches your Account. If you make a lump sum payment using a new direct debit mandate it will take at least ten (10) Business Days before the payment reaches your Account. A Business Day is a full day on which the London Stock Exchange and banks are open in England and Wales (other than Saturday, Sunday or a bank holiday). Regular investments 8.2 You can make regular purchases of the same investment by direct debit, which can be monthly, quarterly, half-yearly or annually. We collect direct debits on the 1st and 16th of the month or the next Business Day if this is not a Business Day. If you wish to amend your regular savings plan and switch from one Fund to another we must receive your request not less than three (3) Business Days before the next collection. Please refer to our Key Features Documents for details of the minimum investment levels for each product. A Fund is explained in clause We must receive any new direct debits and instructions to cancel and/or to make changes to existing ones nine (9) Business Days before the collection date, to ensure it takes effect on that date. If we purchase any investments for you because you have failed to notify us in time that you want to cancel or make changes to your direct debit, you will be responsible for any loss that arises if we have to sell investments. You will also have to pay any reasonable costs we incur in selling your investments. You should also be aware that the investments sold may count as a contribution to your ISA and may result in a tax liability to you. 8.4 If you have set up a direct debit to your ISA, you will only be able to make a lump sum investment to the amount we believe will not exceed your ISA allowance, together with outstanding regular investments for the current tax year. 8.5 We will collect your direct debit until you tell us/your bank/building society to cancel it. This means if you invest in a particular investment and subsequently sell or switch out of that investment we will continue to debit your bank/building society account and if you invest into your ISA by direct debit, your ISA will continue into the new tax year and we will automatically open a new ISA for you. 9 How we deal with your cash Cash Account 9.1 When you open an Account we will automatically open a cash account (Cash Account) for you. You can use your Cash Account to hold money pending investment into your individual products, to receive the sales proceeds of your investments and income payments from your products, to transfer money to your Nominated Bank Account and to pay our charges. We may also deduct any money you owe us from your Cash Account. Product Cash 9.2 Each product has its own separate cash facility (Product Cash) which you can use to hold money within your product pending investment, to receive the sales proceeds of your investments and income payments from the investments within your product, to fund any oneoff withdrawals from the product and to pay our product charges. Where permitted by law to do so, we may also deduct any money you owe us from Product Cash. Paying interest on your cash 9.3 We hold your money together with money belonging to other clients in bank accounts provided by UK banks. This is fully explained in clause 17. We pass on to you any interest we earn on your money at the end of each month. The amount you receive is based on your daily cash balance, but excludes any money which is in transit into or out of your Account. The interest received on the bank accounts is variable. Please contact us or visit our website for details of the latest rates. 10 Giving us instructions 10.1 We will only accept instructions from you in relation to your Account. If you have appointed a financial adviser we may grant them access to view your Account online but we will not accept instructions from them on your behalf. See clause 19 for more information about our online access If you ask us to cancel an instruction before we complete it, we will do all we reasonably can to do so, but we will not be responsible to you if we are unable to We may refuse to carry out, or delay the carrying out of, any instruction: (a) If you have failed to provide us with any information we have requested from you; for example information we require to satisfy our obligations under clause TERMS AND CONDITIONS

17 (b) If we reasonably believe it is incomplete or ambiguous. In this instance we will make reasonable efforts to contact you for clarification. If you do not have enough money to cover the cost of the instruction, in which case we will treat the whole instruction as cancelled. (d) If we reasonably believe the instruction is in breach of our terms and conditions, or may be contrary to any law or regulation. (e) If it is necessary due to events beyond our reasonable control. In these circumstances we will normally process your instruction on the first Business Day after the end of the period of delay. Please see clause 29 for examples of events beyond our reasonable control. 11 Buying and selling investments ( dealing instructions ) Generally 11.1 In this clause 11 we set out how we will carry out your dealing instructions, how long it will take us to carry them out, how you can pay for the investments you want to buy and what we may do if you don t. We also provide more information in our Order Execution Policy including the factors we consider to ensure we get the best results for you when carrying out your dealing instructions. You can find the policy in Annex 2. You consent to the policy by agreeing to our terms and conditions We will carry out dealing instructions given by you on an executiononly basis. This means that we will not provide you with advice on the advantages and disadvantages of undertaking transactions in any investment; nor will we assess the suitability or appropriateness of any investment for you and so you will not benefit from the protection of the FCA Rules on assessing suitability. You should refer back to your financial adviser if you are concerned about whether a particular investment is suitable for you We will carry out your dealing instructions subject to the minimum dealing amounts we have in place from time to time. You can find the current levels in our Key Features Document We may change the range of investments we make available to you. If an investment becomes unavailable we will notify you at the next appropriate opportunity. We may also require the disinvestment of existing holdings in the investment(s) that we are removing, in which case we will state this and any options you have in the notice. How we carry out your dealing instructions 11.5 How we carry out your dealing instructions may depend on whether the investment is a Fund or a Security. A Fund is any of the J.P. Morgan Open Ended Investment Companies (OEICs) we make available to you. It also includes the J.P. Morgan Société d Investissement á Capital Variable (SICAVs) and third party OEICs and unit trusts which you hold within your Account but which are no longer available for new investment. A Security is a share in the one hundred largest companies (excluding non-j.p. Morgan investment trusts) listed on the London Stock Exchange and any of the J.P. Morgan investment trusts we make available to you. It also includes the companies and non-j.p. Morgan investment trust shares, corporate and government bonds and exchange traded funds (ETFs) which you hold within your Account but which are no longer available for new investment. You can find more information on our Funds and Securities available in our Key Features Document. Funds 11.6 When you instruct us to buy or sell shares/units in a Fund the price the Fund Manager will offer to buy or sell shares/units in the Fund will be the price they calculate at the next Valuation Point. This means we will not be able to tell you in advance what your investment sales proceeds will be. You can get more information on a Fund s Valuation Point in its prospectus. The Valuation Point is the specific point in time when the Fund Managers calculate the price of shares in their Funds. This is normally each Business Day at noon, although some funds are priced at other times and frequencies You should also be aware that Funds are purchased (and subsequently held and sold) subject to the current terms of the Fund s prospectus which may allow the Fund Manager to delay or suspend sales and purchases of shares/units in their Fund. For example the Fund Manager of a Fund which invests in assets such as property and land may suspend your ability to sell your shares/units in the Fund during periods when the property markets in which it invests are particularly unstable. If this happens we may be unable to carry out your dealing instruction for a period of time In addition the Fund Manager may close, wind-up, divide or combine existing Funds that you hold within your Account. We will notify you in the event that a Fund Manager suspends a Fund. If you have been making regular investments in the Fund we will continue to collect your regular contributions and hold them within your Product Cash pending your instructions for investment You can give us a combined dealing instruction to sell one Fund and use the proceeds to buy another. This is known as a switch. You should be aware that you may be temporarily uninvested ( out of the market ) between the carrying out of the sale and purchase instruction. As a result, stock market fluctuations may mean that the number of shares you are able to buy with your sales proceeds may be less than the amount of shares you sold. Securities We will aim to carry out your dealing instruction within the timeframes set out in clause This means that the price of a Security may rise or fall between the time you give us your dealing instruction and the time the sale or purchase is completed. Please note we do not accept limit orders; i.e. dealing instructions to buy or sell a Security at a set price or better We cannot buy or sell fractions of Securities. We will normally round down any dealing instruction to buy a Security to the nearest whole share. If you instruct us to sell Securities to a specified value, for example 1,000, we will calculate the number of shares to be sold based on the previous day s price rounded up to the next share, which means you may receive more or less than the amount requested. Aggregation We will combine the dealing instructions described in (a) to (f) below that you and our other clients give us and execute them as a single transaction. This is known as aggregation. The dealing instructions are: (a) All buy instructions relating to the same Fund. (b) All sell instructions relating to the same Fund. All buy instructions relating to the same Security given to us by telephone and in writing. (d) All sell instructions relating to the same Security given to us by telephone and in writing. (e) All dealing instructions for regular purchases in the same investment which we will carry out on the 1st and 16th of each month, or next Business Day, if this is not a Business Day. We may also aggregate regular purchases with any non-regular buy instructions for that investment. TERMS AND CONDITIONS 17

18 (f) All dealing instructions relating to the reinvestment of dividend income in the same investment. writing, we will carry out your instruction on the next Business Day You should be aware that on some occasions aggregation may result in a more or less favourable price than would have been achieved had the instruction been carried out separately, for example a Fund Manager may impose additional charges or delay in dealing part of the aggregated order until a later Valuation Point. In such circumstances you agree that we may: (a) Share out the additional charges between you and our other clients fairly. (b) Share out any additional Securities between you and other clients, which may result in you having a negative balance in your Product Cash. Wait until we have dealt all aggregated instructions before sharing out the investments or proceeds to you and other clients. (d) Delay your sale instruction until we have enough aggregated sale instructions to meet any minimum dealing requirement and/or sufficient Securities are available in the market We will not aggregate any dealing instructions you give us online relating to Securities. Dealing timeframes for buying and selling investments We aim to carry out dealing instructions promptly but cannot guarantee that they will be carried out at a specific time. Normally once we have received and accepted a dealing instruction to buy investments we aim to carry it out as follows: Funds (a) If you are paying by available cash on your Account or debit card and you give us a buy instruction online, the purchase will be made at the next available Valuation Point, provided that we have received your buy instruction no later than seventy five (75) minutes prior to the Valuation Point. (b) If you are paying by cheque and you give us your buy instruction online we will carry out your buy instruction on the Business Day following receipt of your cheque. If you give us a buy instruction by telephone and you are paying by debit card, or if you give us a sell instruction by phone or in writing, we will carry out your instruction on the next Business Day. (d) If you are paying by cheque and you give us your buy instruction in writing we will carry out your buy instruction on the later of, the Business Day following receipt of the cheque and the Business Day following your written instruction. Securities (e) If you are paying by available cash on your Account or debit card and we receive your buy instruction online within our normal working hours, the purchase will normally be made within one (1) hour of receipt of your instruction, but in some circumstances your dealing instruction will only be placed by close of the London Stock Exchange on the same Business Day. If for any reason we cannot carry out your dealing instruction on the same Business Day we will carry it out on the next Business Day. (f) If you are paying by cheque and you give us a buy instruction online we will carry out your buy instruction on the Business Day following receipt of your cheque. (g) If you give us a buy instruction by telephone and you are paying by debit card, or if you give us a sell instruction by phone or in (h) If you are paying by cheque and you give us your buy instruction in writing we will carry out your buy instruction on the later of, the Business Day following receipt of the cheque and the Business Day following your written instruction. Paying for dealing instructions We may carry out your buy instructions before we have received cleared funds from you i.e. monies that have been credited to your Account and available to you to spend. You are responsible for ensuring that: (a) Sufficient cleared funds are available within your Account on the settlement date, which is the date when you have to pay for your investments. (b) You retain sufficient monies in your Account so that it does not have a negative balance at any time If you do not have enough money in your Account we may take one or all of the following steps: (a) Sell the investments you instructed us to buy, in which case we will not be responsible to you for any loss in the value of the shares between purchase and sale (known as shortfall ). (b) Sell any other investment(s) within your Account to cover any shortfall. If you have set up a direct debit to pay for the investment(s) we may give you an additional thirty (30) days to pay. If you fail to do so, we will sell the investment(s) and you will be responsible for any loss that arises from having to sell the investment(s) You should also be aware that the investment(s) sold may count as a contribution to your ISA allowance and may result in a tax liability to you You may also have to pay any charges we incur if we have to sell investments in accordance with clause You can find details of our charges generally for buying and selling investments on your behalf in our charges schedule which is part of our Key Features Document If you are paying by cheque it must be made payable to J.P. Morgan Asset Management and drawn on an account in your name held with a UK bank or building society. Sales proceeds You can instruct us to credit the sales proceeds of your investments to your Cash Account or Nominated Bank Account (for ISA and Investment Accounts only) or to Product Cash We will always pay sales proceeds to you net of any charges, fees, expenses, taxes, duties or other liabilities that arise in connection with selling your investments. Contract notes Subject to clause we will provide you with a contract note or transaction statement for each dealing instruction we carry out on your behalf which will set out the details of your transaction If you have set up a regular savings plan we will send you a contract note for the first contribution only. Details of all subsequent contributions will be set out in the six-monthly statement sent to you in accordance with clause Please note we will not send you a contract note for any dividends you have asked us to reinvest in accordance with clause TERMS AND CONDITIONS

19 12 Dividends and distributions 12.1 Subject to clause 12.2 we will credit any income you receive from the investments held within your products in accordance with the income payment preference you indicated in your product application form. We will generally credit income payments to your Account within five (5) Business Days of the payment date and these will then be reinvested or paid out according to your preference We will pay any income tax reclaimed in respect of the accumulation shares you hold in any Fund into the appropriate Product Cash. 13 Withdrawals and payments to third parties 13.1 You can make cash withdrawals from your Cash Account, Investment Account or ISA to your Nominated Bank Account, subject to any minimum or maximum sum set by us from time to time. Please note we will only ever make any payments due to you to your Nominated Bank Account and that it can take up to five (5) Business Days after the date you receive your investment sales proceeds into your Account before they are available for withdrawal We may at our discretion make payments to third parties, for example executors and legal representatives provided we are able to satisfy our legal and regulatory responsibilities. You should be aware that this may result in payments being delayed We may, where we consider it reasonable to do so, require your written authorisation before we agree to pay any monies from your Account to you, or to anyone acting on your behalf, or to your Nominated Bank Account. Please note if you have a joint Investment Account we will require written authorisation from all Account holders before we pay monies from your Account. 14 Keeping you informed In addition to providing you with transaction confirmations (see clause 11.23) we will provide you with Account statements every six (6) months showing your Account as at 5 October and 5 April. Investments will be valued at the most recent price for that investment available to us at the time your statement is generated. If we have been notified that you have a financial adviser we will also send copy statements to them. 15 Shareholder information, meetings and voting Prospectuses and Key Investor Information Documents (KIIDs) 15.1 You can get a copy of the prospectus and KIID for each Fund you hold either from jpmorgan.co.uk/investor or by contacting us using any of the contact details set out in our Key Features Document. Reports and accounts and other information 15.2 We will provide you with the reports and accounts for each of your J.P. Morgan investment trusts. You can get the reports and accounts for J.P. Morgan Funds from jpmorgan.co.uk/investor We will also provide you with any other information issued to J.P. Morgan investment trust shareholders including circulars and prospectuses and will notify you of any material changes and changes required by law or regulation to your J.P. Morgan Funds You can ask us to provide you with the reports and accounts and any other information relating to your non-j.p. Morgan investments. We will charge you a fee for this service to cover our administrative costs. Shareholder meetings and voting 15.5 Clauses 15.6 to 15.8 apply to J.P. Morgan ISA and J.P. Morgan Investment Account holders only You can ask us to arrange for you to attend and/or vote at share or unit holders meetings. Please note that we will charge you a fee for all non-j.p. Morgan investment trust and Fund investments to cover our administrative costs Subject to clause 15.8 below we will not exercise any voting rights in respect of any of your investments unless you have expressly asked us to do so and we have expressly agreed to do so. We will charge you a fee for this service to cover our administrative costs If you hold shares in a J.P. Morgan investment trust and in the absence of any specific instructions from you (which includes instructions to vote in favour of or against any resolution, or an instruction to abstain from voting), we may vote on your behalf. 16 Corporate Actions Generally 16.1 From time to time your investments may be subject to Corporate Actions. A Corporate Action is any action by a company or Fund which affects the shares or units issued by them, for example a Fund decides to change its name or a company decides to convert one type of share for another. Some Corporate Actions are mandatory and do not require investors to do anything while others are voluntary and may require investors to make decisions in respect of their investments You should be aware that where your investments are pooled with other clients investments and held in the name of a Nominee Company you may not receive the same treatment or options as you would if your investments were held in your own name. See clause 18 for more information about how we hold your investments. A Nominee Company is a company whose only business is to hold investments in its name on behalf of the beneficial owner Additionally a Corporate Action may give you an option to hold a share or unit or other financial instrument we are not willing to take custody of, for example it would mean the Nominee Company holding a share not listed on the London Stock Exchange or a financial instrument that the FCA would consider a complex investment (e.g. a warrant). If this happens we will sell the share/unit/other financial instrument and pay the sales proceeds, if any, into your Account. Rights issues 16.4 A rights issue allows a company s existing shareholders either to buy additional shares in the company or to sell the rights to additional shares in the market. Where the Corporate Action is a rights issue we will sell the rights and credit the sales proceeds, if any, to your Account. Corporate Action instructions 16.5 We will do all we reasonably can to notify you of all Corporate Actions, any options you have and the deadline by which we require your decision. You should be aware that to ensure we meet the deadlines imposed by companies we often have to impose an earlier deadline on Corporate Actions than those set out in the company documents. This means that sometimes it may not be possible to notify you within the relevant timescales and in such circumstances we will apply the company s default option or the option most appropriate to us Where a Corporate Action requires you to choose from a list of options and you do not tell us which option you want to choose within the deadline we gave you, we will select the company s default option or the option most appropriate to us or otherwise let the option lapse We will not be responsible to you for any losses arising out of a failure of any notification to reach you or a failure of your instructions to reach us in relation to a Corporate Action matter unless your loss is due to our fraud, negligence or wilful default. TERMS AND CONDITIONS 19

20 How we allocate shares/units/cash 16.8 The Nominee Company will usually receive one allocation of shares or units or cash for all clients who participate in a new issue, rights issue or bonus issue (sometimes known as a scrip issue, where you are offered free shares based on your existing holdings) or who receive additional shares or units as result of a take-over, share conversion or other offer. You agree that we may round down your entitlement to the nearest whole number and further agree that any fractions of shares, units or cash that cannot be allocated to you will be retained by us, and whenever possible, donated to a charity of our choice. Shareholder litigation 16.9 We will do all we reasonably can to notify you of any proposed class action or group shareholder litigation concerning investments that the Nominee Company is holding on your behalf. 17 Protecting your investments and cash Your investments 17.1 We are responsible for safeguarding your investments. We may also appoint other companies (known as subcustodians) to safeguard your investments on our behalf. We register investments in the name of a Nominee Company. It holds your investments on your behalf and you are and will always remain the beneficial owner. We accept responsibility for the Nominee Company and any subcustodian s acts and omissions in relation to your investments to the same extent that we are responsible for our own acts and omissions as set out in our terms and conditions You must always remain the beneficial owner of your investments and you must not dispose of or transfer any interest in any investment while it is held in your Account. Additionally you must not create any charge or security on or over any investment; for example you must not use them as security for a loan Share certificates or other documents of title will be held by us, the Nominee Company or as we otherwise direct. You can ask us to transfer J.P. Morgan Investment Trust you hold within your ISA or Investment Account into your own name. We will not charge you for this service and it may take up to eight (8) weeks to complete. Please be aware that if you transfer shares in your ISA into your name only they will lose their ISA status We will not transfer, exchange, exercise rights attached to, or otherwise deal with investments unless we receive instructions from you, or unless as expressly set out in our terms and conditions Your investments will generally be held together with other clients investments in a pooled account. When investments are pooled individual entitlements may not be identifiable by separate certificates, other physical documents of title or equivalent electronic record. This means that in the event of our, the Nominee Company or any subcustodian s insolvency and there is a shortfall which cannot be reconciled, there is a risk that you may have to share proportionally in that shortfall with all our other clients We have put in place measures to ensure your investments are adequately protected. This includes always keeping your investments separate from our assets and internal procedures to ensure we can always identify your investments and which cover the selection, approval and monitoring of any subcustodian we appoint. Clause 31 and our Key Features Documents also provide information on the protection provided by the Financial Services Compensation Scheme. Your cash 17.7 We hold all cash belonging to you on your behalf in client money accounts provided by one or more banks. We also hold your money separately from our money, which means that in the event of our insolvency our creditors will have no claim on it. Your money is pooled together with money belonging to other clients. This means that if the bank holding your money becomes insolvent and is unable to repay all of its creditors, which includes you and our other clients, any shortfall will be shared proportionally between them. In this situation you may be able to make a claim under the Financial Services Compensation Scheme and if so, we will make the claim on your behalf. Please see clause 31 for more information on the Financial Services Compensation Scheme We hold your cash in accordance with the FCA Rules which requires us to have in place adequate record keeping, accounts and reconciliation procedures to safeguard it. We also have in place procedures to cover the selection, approval and monitoring of the bank(s) we use to hold your money. Our rights over your investments and cash 17.9 You agree that we are entitled to hold on to the investments and money within your Account until you have paid off your debts and liabilities and satisfied your obligations under our terms and conditions. Our right to hold on to your assets will be in addition to any other rights we may have under any law If you owe us a debt we may use any of your investments or cash to pay off or reduce that debt and we will not be responsible to you for any tax charges or other losses you incur as a result of this We will not lend your investments or cash to anyone or use them as security for borrowing. 18 Your responsibilities in respect of your investments 18.1 Without limiting your responsibilities set out elsewhere in our terms and conditions, you are solely responsible for your compliance with all laws, regulations and rules which apply to your holding of any investment, including any tax, foreign exchange and capital controls Unless we expressly agree with you otherwise, you are responsible for any reporting or filing requirements that may apply as a result of your country of citizenship, domicile or tax residence. We do not support reduced withholding tax claims under applicable tax treaties on overseas investments and therefore you may suffer higher withholding tax than that applicable under an applicable tax treaty and you may not be able to offset any overseas tax paid against any UK tax liability arising to you. You should speak to your professional advisers if you require further information. 19 Online access 19.1 You can view, manage or transact on your Account online. We will send you your username and single-use password (your Security Details) separately by post, (or by if your open your Account online), when you open your Account. You can also contact us for your username and to set up a new password You must keep your Security Details confidential and secure and not share them with any other person. If you think that your Security Details have been or may have been disclosed to any other person you must inform us as soon as possible or at least within seven (7) days and assist us to remedy any security breach, so that we can protect your Account. If you fail to notify and/or cooperate with us we will not be responsible to you for any loss you may suffer as a result of any unauthorised access to your Account We will accept in good faith all instructions placed using your Security Details as a valid instruction from you and we will be entitled to act on those instructions without further confirmation, unless we have been notified of a security breach If you have a financial adviser registered with us, they may request us to provide them with their own Security Details, which they may use to view your Account. 20 TERMS AND CONDITIONS