The legislation is silent on who can receive income but starts from the presumption that the fee is paid to the person providing the service. That said, revenue flows in the financial planning industry typically flow through licensees for commercial reasons and administrative efficiency.
Who receives payments from clients in a corporate authorised representative/AFSL holder relationship is dependent on the agreement in place between the two parties. In the financial planning industry, clients generally pay fees for service to the licensee who also issues the invoice.
Also, commission is typically paid by issuers directly to the licensee. The licensee then passes commissions and fees (less their licence fee) to the corporate authorised representative. The Future of Financial Advice (FOFA) reforms have regulated the flow of commissions, and you should seek more specific advice on that point.
We suggest referring to the original agreement to determine the terms of the relationship and how clients are invoiced.
If we can assist further, please contact our financial services team for help.
Author: Paul Derham
