Thousands of investors in Octopus Investments' Octopus Inheritance Tax Service face an estimated £40m service-fee bill despite the firm's pledge last month to waive its annual management charge (AMC). The scheme has 18,000 customers and invests in businesses eligible for inheritance tax relief through Fern Trading, which owns about 300 energy, property and telecoms companies. Fern Trading was frozen to redemptions for nearly three months during the summer and split into Fern A and Fern B in October. Fern A has reopened to redemptions, while Fern B remains closed. Octopus will continue charging a 1.85% service fee on Fern A, expected to generate around £40m. The Fern B charge has been deferred and will apply only if that fund reaches a specified return benchmark. The AMC applies only when annual returns exceed 3%. A Telegraph analysis found that no investor group entering the scheme since 2011 reached that threshold: 2011 investors achieved the strongest annualized growth, at about 2.2%, while returns were negative for investors who joined from 2022 onward. Octopus has collected more than £900m in fees from Fern Trading since its founding in 2010. The firm said it had made significant fee changes and would not receive the AMC if it failed to deliver the targeted outcome for customers.