Some consumer credit firms that previously had an Office of Fair Trading (OFT) licence and registered for interim permission may be entitled to a credit on their first annual fee invoice.
This credit will be for the Financial Ombudsman Service levy the firm paid with its final OFT licence fee, as set out in our regulated fees and levies policy statement (PS14/11).
This levy may also have been called a ‘FOS CCJ levy’.
Qualifying for a credit
To be entitled to a credit the firm must have:
- paid the Financial Ombudsman Service levy to the OFT
- registered for consumer credit interim permission
- become authorised by us
The OFT maintenance payment due date must then be after the date the firm becomes authorised by us to carry out consumer credit activities.
Calculating the credit
The amount of credit your firm will receive is calculated as follows:
- the amount paid to the OFT for the Financial Ombudsman Service levy
- multiplied by [the number of months which would have remained on the OFT licence after becoming authorised by us]
- divided by [60 (the number of months in five years)]
For example, an indefinite licence held by a sole trader:
- maintenance charge due date: 1 September 2016
- total fee paid to OFT: £585 (of which £435 consumer credit licensing fee; £150 Financial Ombudsman Service levy)
- firm becomes authorised by us: 1 March 2015
- months remaining from 1 March 2015: 18
- credit calculation: £150 x 18 ÷ 60 = 45
- credit amount: £45
Receiving the credit
If you are entitled to a credit it will be included in the first annual fee invoice after a consumer credit firm becomes authorised by us.
The credit will be shown on the invoice as ‘industry block IXCC (FOS OFT rebate)’ and the tariff base will be ‘OFTFOSCR (OFT credit of unexpired OFT FOS levy)’.
If the credit value is greater than the fees charged we will issue a cheque for the difference.