Handling trust money properly is critical for any real estate agency. Agencies must follow strict rules when receiving, recording and managing clients’ funds in a trust account. Knowing who in the agency can receipt trust monies in real estate ensures your business stays compliant and protects client money. It also prevents costly audits, fines or licence loss. This guide explains who can receive trust money, how to manage your trust account daily, and why proper systems are necessary to protect your real estate agency.
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Table of Contents
Who Can Receipt Money Into A Trust Account In A Real Estate Agency?
Knowing who can legally receipt trust money into a trust account is crucial for compliantly managing real estate trust accounts.
What Does Receipting Trust Money Mean?
Receipting trust money means recording any money received into the trust account immediately. The receipt must include:
- Date of receipt
- Payer’s full name
- Purpose of payment
- Amount received
- Method of payment (cash, cheque or EFT)
Accurate receipting builds trust with clients and supports clean trust account audits.
Who Can Legally Receipt Trust Money?
Only authorised roles can receipt trust money:
- Licensed estate agents
- Authorised employees
- Registered sales representatives under supervision
| Role | Authority to Receipt Trust Money |
|---|---|
| Licensed Estate Agent | Yes |
| Authorised Employee | Yes (if supervised) |
| Registered Sales Representative | Yes (if supervised) |
| Receptionist or Admin Staff | No (unless authorised) |
Agencies must ensure that only trained staff handle receipting to comply with trust account rules.
Understanding Trust Money: What You Can And Cannot Handle
Correctly handling trust money in the property industry protects your agency’s compliance and reputation.
Examples of Trust Money:
- Rental payments
- Bond money
- Sales deposits
- Prepaid advertising
- Repairs and maintenance funds
Examples of Non-Trust Money:
- Commission already earned
- Administration fees
- Paid reimbursements
| Type | Examples | Trust Account Needed |
|---|---|---|
| Trust Money | Rent, bonds, deposits | Yes |
| Non-Trust Money | Commission, fees | No |
Mismanaging these can trigger trust account audits and penalties.
Opening A Trust Account: Step-By-Step Guide
Agencies must correctly open a trust account at an authorised financial institution to legally handle trust money.
Opening Checklist:
- Choose an authorised financial institution.
- Correctly name the trust account using the agency name.
- Notify the regulator (eg, Fair Trading) within 14 days.
- Lodge all trust money promptly.
- Ensure audit access to all trust transactions.
| Step | Action |
|---|---|
| Choose an authorised bank | Confirm regulator approval |
| Proper account name | Include “Trust Account” |
| Notify regulator | Within 14 days |
| Lodge money fast | Same day, if possible |
| Provide auditor access | Full document access |
How To Correctly Issue A Trust Receipt
Issuing proper trust receipts ensures transparent tracking of trust money in your trust account.
Receipt Requirements:
- Accept payment (cash, cheque or EFT)
- Record the transaction immediately
- Issue a receipt at the time of payment
- Deposit money into the trust account fast
Each receipt must include:
- Unique receipt number
- Payer’s details
- Payment amount and purpose
- Trust account details
- Authorised signature
Correct receipting prevents mismanagement issues during trust account audits.
Managing Trust Payments And Withdrawals
Managing trust account transactions carefully keeps your real estate agency compliant.
Processing Payments:
- Record payment in the ledger.
- Confirm authorisation before releasing funds.
- Match payments to the ledger and the bank statement.
Payments must be made by cheque or EFT and recorded securely.
Authorising Payments and Withdrawals:
The following can be authorised withdrawals from a trust account:
- Licensees
- Authorised officers
- Principals (with supervision)
Every withdrawal must meet trust account laws and be properly documented.
Handling Trust Money Correctly In Daily Operations
Strong daily systems are critical for managing real estate trust accounts and staying audit-ready.
Daily Trust Money Management Systems:
- Daily reconciliations
- Immediate ledger updates
- Supervisor oversight
- Duplicate checks
- Timely lodgment
| Best Practice | Common Mistake |
|---|---|
| Reconcile daily | Delay reconciliations |
| Lodge promptly | Late lodgments |
| Keep full records | Incomplete ledgers |
| Supervisor reviews | No daily oversight |
Correct daily habits support clean trust account audits and protect the agency’s reputation.
Authorising Trust Account Transactions: Roles And Responsibilities
Formal authorisation of trust account transactions is essential to protect agencies during audits and inspections. To maintain compliance, every authorisation must match the trust ledger, bank statement and transaction records.
Only the following people may legally approve the movement of trust money:
- Licensees
- Authorised officers
- Principals or directors (under supervision)
Agencies must ensure that authorisation is documented and supported by complete financial records. Proper authorisation safeguards client funds and strengthens internal trust account management.
Licensee Responsibilities When Receiving And Managing Trust Monies
The licensee must actively supervise handling trust money to protect the agency’s licence and ensure full compliance with trust account laws.
| Duty | Licensee | Staff |
|---|---|---|
| Open a trust account | Must ensure compliance and setup | May assist under instruction |
| Receipt trust money | Must supervise and verify | Only if authorised |
| Authorise transactions | Must approve or oversee authorisation | May assist if authorised |
| Reconcile the trust account | Must oversee monthly reconciliations | May assist with preparation |
The licensee is legally responsible for maintaining the integrity of all trust account activities. Proper supervision helps prevent errors, strengthens client confidence, and ensures the agency passes trust account audits without issues.
Understanding Deposits And Lodgments Into Trust Accounts
Depositing trust money correctly is a key part of trust account management. Every deposit must be lodged into the correct trust account immediately to protect client funds and meet legal obligations.
Best Practice For Lodgments
- Deposit all trust money into the account by the next business day.
- Match every lodgment to the correct entry in the trust ledger.
- Confirm each lodgment against the monthly bank statement.
- Never deposit trust money into trading, business or personal accounts.
Trust Account Audits: Preparation And Compliance Essentials
All agencies managing real estate trust accounts must complete and pass annual trust account audits. These audits confirm that trust money has been handled correctly and that the agency complies with legal obligations.
Key Audit Deadlines
| Task | Timeframe |
|---|---|
| Complete audit | Within 3 months after the end of the financial year |
| Lodge audit report | Within 4 months after the end of the financial year |
| Report issues | Immediately upon discovery |
Staying audit-ready helps agencies deal with trust money lawfully, maintain client confidence and avoid severe penalties for non-compliance.
What Happens If You Accidentally Receipt Non-Trust Money?
Accidentally receipting non-trust money into a trust account must be corrected immediately to maintain compliance and protect client funds.
Steps To Correct The Error
- Identify the mistake by reviewing the trust ledger and receipt records.
- Reverse the incorrect transaction clearly in the ledger.
- Return the non-trust money to the rightful party without delay.
- Update all ledgers and audit trails to reflect the correction.
- Notify the regulator or your auditor if required under state laws.
Correcting errors quickly prevents more significant breaches, protects the agency’s licence and helps maintain client trust.
Real Estate Industry Compliance: Why Proper Trust Money Handling Matters
Proper handling of trust money protects your agency’s reputation, secures your licence and strengthens client trust. It also reduces the risk of penalties, audits and regulatory action.
To Stay Compliant, Agencies Must:
- Follow all trust money laws and regulations.
- Reconcile trust account transactions accurately and on time.
- Keep complete and organised financial records.
- Always use a trust account when receiving trust money.
Strong and consistent compliance helps real estate agents grow safely within the property industry and build long-term client confidence.
FAQs: Trust Money And Receipting
When Should You Use A Trust Account?
You must use a trust account when your agency receives money on behalf of someone else. This includes rental payments, bonds, sales deposits or prepaid advertising costs. The agency must hold these funds in a trust account until they are legally due to be paid out. A trust account protects clients and ensures the agency complies with trust account laws.
How Quickly Must You Lodge Trust Money Into A Trust Account?
Trust money must be lodged in a trust account as soon as possible after it is received. Most state laws require agencies to deposit trust money by the next business day. Delaying the deposit can breach fair trading rules and cause trust account audit failures.
How Do You Properly Manage Your Trust Account?
To manage your trust account correctly, you must follow strict daily processes. This includes issuing receipts immediately, updating the trust ledger after each transaction and reconciling the trust account monthly. Agencies must hold complete records to show compliance regarding trust accounts. Strong property management systems help agencies stay audit-ready.
What Is The Role Of The Agents Financial Administration Act 2014?
The Agents Financial Administration Act 2014 outlines Queensland’s legal rules for managing real estate trust accounts. It outlines how agencies must receive, deposit and handle trust money. It also sets out the audit requirements, record-keeping rules and notification duties if breaches occur. This Act protects the agency’s licence and keeps clients’ funds secure.
Protect Your Agency With Correct Trust Money Handling
Managing trust money correctly protects your clients’ funds, keeps your agency compliant and builds business trust. Now is the time to review your internal trust account procedures and fix gaps. Strong systems reduce audit risks and show clients you take their money seriously. If you want expert help managing real estate trust accounts, PMVA offers professional outsourcing support to keep your agency secure and ready for growth.
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Having a dedicated Virtual Assistant in your real estate business can open the door to a variety of new strategies. Learn how you can grow beyond your current limits by booking a private consultation with our CEO, Tiffany Bowtell now.
