TAX ON COMPENSATION

An IFA previously advised a client to transfer his pension pot in  a former employers pension scheme into a commercial property SIPP. The SIPP was unsuccessful and wound up and the  client only got back his original contributions. Thus he lost all growth from 2005. A successful  claim was made to the FSCS and the client was awarded a sizeable compensation amount for Miss selling. The question being, is this taxable and needs to be disclosed ?