Last updated · By Mustafa Bilgic
How the 25% cap works
The cap is the single most misunderstood part of no win no fee. People assume the solicitor takes 25% of the whole settlement. They cannot. The success fee can only come from two parts of your award:
- General damages — compensation for the injury itself (pain, suffering and loss of amenity).
- Past financial losses — the losses you have already incurred by settlement, such as lost earnings and treatment costs to date.
Everything awarded for the future — future loss of earnings, future care, future treatment — is ring-fenced. No success fee can be deducted from it. That protection matters most in serious-injury claims, where future losses can dwarf the rest of the award.
A worked example
Suppose your claim settles like this: £20,000 general damages, £5,000 past losses, £30,000 future loss of earnings. The success fee can only touch the first £25,000. At the full 25% cap, that is a £6,250 deduction. You keep £18,750 of the capped part plus the entire £30,000 of future loss — £48,750 of the £55,000 total, around 89%.
What you do not pay (and what you might)
- If you lose: normally nothing to your own solicitor for their time. After-the-event (ATE) insurance, arranged at the outset, covers the other side’s costs and your disbursements.
- If you win: the capped success fee, plus any ATE premium and unrecovered disbursements your agreement makes you responsible for. The losing side usually pays most of your solicitor’s basic costs separately.
- Always check whether the firm charges the full 25% or less, and exactly what the ATE policy covers, before signing.
No win no fee — frequently asked questions
How much does a no win no fee solicitor take?
The success fee is capped at 25% of your general damages and past losses (including VAT) in England & Wales. It cannot be taken from future care or future loss of earnings, so you keep at least 75% of the capped parts and all of your future losses.
Is the 25% deducted from my whole settlement?
No. It applies only to general damages and past losses. Future losses are protected. Many firms also charge less than the full 25%.
What do I pay if I lose?
Normally nothing to your own solicitor for their time. After-the-event (ATE) insurance, set up at the start, covers the other side’s costs and your disbursements. Check what the policy covers before you sign.
Does the cap include VAT?
Yes — the 25% maximum is inclusive of VAT. It is a hard ceiling on the success fee taken from the qualifying parts of your award.