Our Interest Policy

1. Interest

A.   As required by Rule 7 of the SAR the company has adopted a policy on the payment of client interest.

B.  The SAR require the company to account to clients for interest where it is fair and reasonable to do so.

C.  For cleared funds paid into client account, the company shall account for interest when it is fair and reasonable to do so unless:

1. 1. The amount of interest calculated on the balance held is £50 or less (below that sum we consider that the administrative costs of dealing with the funds would exceed the interest due); and/or
   2. One of the following applies:

• Money is held for the payment of professional disbursements
• There is an agreement to contract out of the terms of the interest policy
• A client fails to present a cheque to the bank for payment
• Mortgage funds are held overnight or over the weekend to ensure there are no delays on completion of a matter
• Funds are held for less than 14 days on a conveyancing, commercial real estate or company commercial matter.

D.  Interest will be calculated from the time funds become cleared for interest purposes and may be calculated at an interim stage as requested and at the end of the matter and will be credited to the client ledger at that time.

E.  Interest will be calculated and paid by reference to applicable rates over the period for which we hold cleared funds. Interest will be calculated by the accounts department at the bank interest rate received on Clarke & Son’s client account with NatWest, which as at 23rd June 2025 is 1.10%.

F.  Interest is received gross and will be paid to the client gross. It is the client’s responsibility to notify HMRC of any interest received and to make payment of any tax due as a result. We will not notify HMRC or pay any tax due on a client’s behalf unless we have formal instructions to do so and have agreed to this in writing. (Different circumstances may apply in Probate and Trust matters.)

G.  What is fair and reasonable? The holding of funds will be incidental and necessary for the carrying out of the legal instructions. The operation of a client account has cost implications for the firm and is incidental to the carrying out of legal work on behalf of our clients.

Consideration will be given to each individual matter as to whether interest should be paid and when considering this the fee earner will take into account:

• the amount held and for how long it has been held
• the reason why the funds have been held for that period of time
• the type of matter
• any additional costs in terms of administrative expenses and time that has been incurred

H.  The policy on the payment of interest to clients is kept under regular review.