What a registered adviser or analyst can charge a client

Fee regulation is the part of this framework that changes business models rather than paperwork. If you are building an advisory practice around retail clients, the ceiling decides your revenue per client before you have signed anyone.

Investment Advisers: two modes, one ceiling

Regulation 15A lets an adviser charge under either of two modes. Assets under Advice mode is capped at 2.5 per cent of AUA per annum per family of client, across all services you offer them. Fixed fee mode is capped at ₹1,51,000 per annum per family of client, again across all services. The earlier fixed limit was ₹1,25,000.

You used to be locked into a mode for twelve months at a time. That restriction is gone. You can change a client's fee mode whenever you like, and the ceiling that applies is the higher of the fixed fee limit or 2.5 per cent of AUA per annum per family.

Two things that shrink the AUA you can bill on

• You must be able to demonstrate AUA with supporting documents such as demat statements or unit statements of the client.
• Any portion of the client's assets held under a pre-existing distribution arrangement with any entity is deducted from AUA for the purpose of charging your fee.

Also, since investment advice under the regulations means advice on securities under SEBI's purview, AUA means the aggregate net asset value of those securities. The fee limits bite only on that part of what you advise on.

Research Analysts: one ceiling

A Research Analyst may charge a maximum of ₹1,51,000 per annum per family for clients who are individuals or HUFs. RAASB revises that limit once every three years using the Cost Inflation Index, in consultation with SEBI. IAASB does the same for advisers.

Billing in advance

An adviser may charge fees in advance if the client agrees, and the advance may not exceed one year's fees. That figure comes from SEBI's circular of 2 April 2025, which relaxed a tighter earlier position. If the engagement ends early, the client gets refunded for the unexpired period, and the adviser may keep a breakage fee of no more than one quarter's fee.

For Research Analysts the January 2025 guidelines set the advance period at one quarter and stated that no breakage fee may be charged on premature termination. The April 2025 circular changed the advance-fee position for both registrations. We have read that circular's effect on the adviser side directly and not on the analyst side, so we confirm the current analyst position at scoping rather than state it here.

Who the ceiling does not apply to

Fee limits, refunds, advance fees and breakage fees apply to individual and HUF clients who are not accredited investors. For non-individual clients and accredited investors, and for institutional investors taking a proxy adviser's recommendations, fees are whatever the two sides negotiate. The limits also exclude statutory charges, so GST is not counted inside your ceiling.

The practical consequence

A retail-facing advisory practice has a revenue cap per family that is knowable in advance, so scale comes from client count, which then runs into the deposit slabs and, for individual advisers, the 300-client line. A practice serving non-individual clients and accredited investors has no such cap. Deciding which of those you are building is a business decision that the regulations make for you if you do not make it yourself.

One rule that sits underneath all of this: no advice may be rendered and no fee may be charged until the client has signed the investment advisory agreement and been given a copy of it.