Western Australia's REBA trust accounts: banking, interest and audit

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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In Western Australia, the money an agency takes in for a vendor, a buyer or a landlord sits under Part VI of the Real Estate and Business Agents Act 1978. The Part is short, and its wording is blunt: one kind of account, entries made by the end of the next business day, a balance struck every month, an auditor who reports to the regulator, and a fine that can reach A$50,000 for the heaviest offence. The calendar it runs on is the calendar year, which is why the last day of March matters to every agency principal in the state.

This guide follows the money through that Part. It rests on the Act itself, in the version published on the Western Australian legislation site as at 1 July 2022, and on what Consumer Protection, the division of the Department of Local Government, Industry Regulation and Safety that administers it, says in its trust account handbook of September 2025, its audit requirements page and its industry bulletins. It covers opening and naming the account, banking and receipts, withdrawals, interest, the yearly audit, what has to be reported when an account goes wrong, the Fidelity Guarantee Account that stands behind clients, and the penalties. Where those sources do not agree, or stop short, the guide says so.

Real Estate and Business Agents Act 1978 (WA), sections 70, 84 and 86, and the Consumer Protection trust account handbook, September 2025.

Who must keep a trust account, and what goes into it

Section 68 of the Act puts the duty on every agent who holds a current triennial certificate, the three-yearly certificate that allows a licensed agent to trade. That agent must keep at least one trust account, used only for the purposes of the Act, and must pay into it all money received for or on behalf of another person in connection with a transaction.

The Act's definitions, in section 67, describe trust accounts as the accounts holding money an agent receives or holds for another person in connection with transactions. The handbook fills in the practical meaning. Trust money, it says, is money held for another person in relation to a real estate, business sales or property management transaction. Collecting rents falls within a real estate transaction, so rent received for a landlord is trust money in the same way as a deposit on a sale. Money an agent collects for a strata company is deemed trust money as well.

The account must be held with what the Act calls an authorised financial institution, defined in section 67 as a bank or another body that the regulations prescribe.

One protection in section 68 matters to every client. Money in a trust account cannot be attached or seized by the agent's creditors. If the agency itself runs into financial trouble, the balance of the trust account is not available to pay the agency's own debts.

Naming the account and telling the Commissioner

The Act requires the account to be "designated" as a trust account in the prescribed manner, and the handbook sets out what the regulations prescribe. The title of a general trust account must contain three things: the words "REBA Trust Account", the full legal name of the holder with any business name recorded by the Commissioner, and the letters "TC" followed by the triennial certificate number. The handbook cites regulation 6D of the Real Estate and Business Agents (General) Regulations 1979 for this; Consumer Protection's bulletin of January 2025 refers to regulation 6 for titling.

Section 68C then requires notice. When an agent opens or closes a trust account, the agent must tell the Commissioner for Consumer Protection in writing as soon as practicable, giving the name and number of the account and the name and address of the institution. The handbook reads the duty a little wider than the section's words: it asks for notice when an account is amended as well as opened or closed, and for the date of the change. A form for the purpose is published by Consumer Protection.

The notice rule does not apply to a separate interest-bearing account opened for one client, which is covered below. The handbook is careful about what that exemption means: such an account does not have to be notified, but it must still be audited.

A person cannot begin taking client money before being authorised to trade. The handbook warns that accepting client funds into trust before the licence and the triennial certificate have been granted can attract a fine of A$100,000 under section 26 of the Act.

Banking the money and writing the receipt

The Act's deadline for banking is "as soon as practicable". It gives no number of days. The handbook supplies the regulator's reading: in the Commissioner's view, trust money is banked by the close of business on the next working day. Cash, it adds, is banked as cash.

Section 69 deals with the receipt. An agent who receives money for another person must immediately give the payer a receipt in the prescribed form, unless the money arrived by electronic transfer, and must keep a record of the money. According to the handbook, a receipt carries the name of the certificate holder and any registered business name, a consecutive number or letter, the date, the payer's name, the amount and a brief statement of what the payment is for. A handwritten receipt also carries the name and signature of the person who took the money.

An electronic transfer needs no receipt, but it does not escape the record. The handbook asks for an entry with the same details: a consecutive number or letter, the date, the payer, the amount and the purpose.

The daily entry and the monthly balance

Section 68 sets four record-keeping duties in a single subsection. The agent must keep full and accurate accounts of all money received or paid for others. Each receipt or payment must be entered, with its amount and the other party, before the end of the next business day; the Act defines a business day as any day other than a Saturday, a Sunday or a public holiday. The accounts must be kept in a way that lets them be conveniently and properly audited. And they must be correctly balanced at the end of each month.

The handbook turns the monthly balance into a routine. The accounts are reconciled as at the close of business on the last day of the month. The reconciliation is finished within 10 working days, signed and dated by the person in bona fide control of the business, and the handbook is categorical that a client ledger must never go into debit.

Records are kept for a long time. The handbook gives a minimum of six years from the date the money was received, and cites regulation 6H.

Taking money out of trust

Withdrawals are where the Act's heaviest personal penalty sits. Under section 68, money received for another person may be withdrawn only for the transaction it relates to, as the Act otherwise authorises, or as the person entitled to it authorises. Whatever is withdrawn must be paid to the person lawfully entitled or authorised to receive it. An agent may pay the proper charges of a transaction from the account, but only once those charges have lawfully fallen due.

The handbook describes how that works for the agency's own fee. Commission is drawn only under a valid written appointment. Bank fees are paid from the general account, no buffer of the agency's own money is kept in trust, and the handbook's best practice is to transfer fees at least weekly once the agency is entitled to them, and not before settlement.

Where the interest goes

An agency does not earn interest on its general trust account. Section 68B requires each authorised financial institution to pay interest on the balance of every trust account it holds, at a prescribed rate and at prescribed times, into what the Act calls the Interest Account, established under section 125 and named in the heading of Part IX as the Real Estate and Business Agents Interest Account. The handbook puts it plainly: the institutions pay the interest to the department, not to the agent. It says the money funds the Commissioner's functions under the Act and under the Fair Trading Act 2021, including education, advice and the investigation of real estate matters.

Two things about that interest are not settled by the pages read for this guide. The first is the rate: the Act leaves it to the regulations, and the handbook does not state it. The second is the split. Consumer Protection's page on the Fidelity Guarantee Account, last updated on 8 July 2026, lists interest on agents' trust accounts among that account's sources of funds, while section 68B sends the interest to the Interest Account. How much of it reaches the fidelity account, and by what route, is set in parts of the Act this guide does not describe.

There is one way for a client to earn the interest instead. Under section 68A, a person may ask in writing for the money they pay to be placed in a separate interest-bearing trust account, and the agent must comply once any conditions in the regulations are met. All the interest on that account goes to the person who asked. The handbook gives the conditions for a sale, citing regulation 6E: either the money paid is more than A$20,000, or settlement will not take place within 60 days. The request is made before settlement and kept on file. The account's title carries the words "REBA Trust Account", the letters "IB" and "in trust for" followed by the client's name; the handbook says the abbreviation "ITF" is not accepted.

A worked example, with assumed figures. A buyer pays a deposit of A$25,000 on a contract due to settle in 45 days: the amount is over A$20,000, so the first condition is met and a written request can be acted on. A buyer who pays A$15,000 on a contract settling in 90 days also qualifies, this time on the second condition. A buyer who pays A$15,000 on a contract settling in 30 days meets neither.

The yearly audit and the 31 March deadline

Section 70 requires every agent who held a current triennial certificate during any part of a year to have the trust accounts audited for that period. The year, under section 67, is the 12 months ending on 31 December. The auditor must deliver a verified report in an approved form to the Commissioner, and a copy to the agent, within three months after the end of the year. Consumer Protection's audit requirements page draws the conclusion: an audit period of 1 January to 31 December, and a deadline of 31 March. For the 2024 audit year its bulletin of January 2025 set the cut-off at 5pm on 31 March 2025.

The auditor is not anyone with an accounting qualification. Section 72 allows only a person registered, or taken to be registered, as an auditor under Part 9.2 of the Corporations Act 2001 of the Commonwealth. Where the Commissioner is satisfied that no such person is available in a district, the Commissioner may approve a person with other qualifications. The auditor must disclose to the Commissioner any de facto or close family relationship with the agent and any business dealings with the agent, and may be disqualified on that ground. The handbook adds that the auditor cannot also be the agency's general accountant.

The agent appoints the auditor when applying for the licence, pays the auditor's reasonable fees, and cannot simply switch: under section 73 the appointment continues unless the Commissioner approves a change. On the timing of that request the two Consumer Protection documents differ. The handbook says to apply no later than one month after the end of the audit year, giving 31 January as its example; the January 2025 bulletin asked for the signed change of auditor form by the end of February 2025.

The agent's part is set out in sections 77 and 80. The agent must produce the books and give the auditor the information reasonably required, and must prepare and certify a statement of the money held for others on the last day of the audit period, together with securities. The statement is verified by statutory declaration: one partner signs for a firm, and the person in control of the business signs for a body corporate. An agent audited for the first time prepares a similar statement as at the first day of the period.

The report answers the questions listed in section 79: whether the accounts have been regularly and properly kept, whether they were ready for examination, whether the agent complied with the auditor's requirements, whether the accounts are in order, and whether there is anything the Commissioner should be told.

Time can be extended, but not by silence. Section 70 lets the Commissioner extend the period for lodging. The bulletin explains the procedure: the auditor writes, sets out exceptional circumstances, confirms that the trust records are in the auditor's hands and names the date the report will be lodged, and the Commissioner must approve the request before 31 March.

No trust money, shared audits and closing down

Not every certificate holder has accounts to audit. Section 86 treats an agent as having complied if the agent neither received nor held money for another person during the year and delivers a statutory declaration saying so to the Commissioner within three months after the year ends, the same 31 March.

Section 87 prevents the same accounts from being audited several times over. The audit of a firm's trust accounts also counts for each partner who is an agent and for the agent in control of the business; the audit of a body corporate counts for each director who is an agent; and an audit that includes a branch counts for the agent managing that branch. The audit requirements page adds a condition: this applies only where the person held the role for the whole audit period. A person who did not, and who held a current triennial certificate, lodges an audit report or a declaration in their own right.

Leaving the industry brings a final audit. Under section 70, when a triennial certificate ceases to have effect, the trust accounts are audited within three months, and the auditor reports to the Commissioner within two months after the end of those three months. As a worked example on assumed dates, a certificate that ceased on 30 June 2025 would call for an audit by 30 September 2025 and a report by 30 November 2025.

When the account is short

The Act sets out who must speak, and when, if a trust account stops adding up.

For theft or misappropriation the handbook lists a sequence. The agent notifies the Commissioner with the date, the amount, the reason and the corrective action; contacts the auditor for a special trust audit; notifies the police; replaces the missing amount immediately; and alerts the agency's professional indemnity insurer. The pages read put no number of hours or days on the other steps.

The auditor has an independent duty. Section 81 requires an auditor who finds that the accounts cannot be properly audited, or who finds dishonesty, a breach of the law, a loss or shortfall of trust money, a failure to pay or account for it, or non-compliance with the Act, to set the facts out fully in a report to the Commissioner. Under section 70, an irregularity found during the year goes to the Commissioner in a verified interim report, with a copy to the agent.

The Commissioner can also act without waiting for the yearly report. Section 88 allows the Commissioner to order an audit at any time, by an auditor the Commissioner nominates, where that is in the public interest; section 90 has the cost paid from the Fidelity Guarantee Account or by the agent, as the Commissioner directs. Under section 92, the State Administrative Tribunal may, on the Commissioner's application, restrain a bank from dealing with an agent's accounts where there are reasonable grounds to believe a trust account is short or that the agent is unreasonably refusing or delaying payment. Under section 93 the Tribunal may suspend the agent and authorise the Commissioner to appoint a supervisor, who carries on the business to finish the matters clients have already begun.

The Fidelity Guarantee Account

Behind the trust account stands a fund. The Real Estate and Business Agents Fidelity Guarantee Account is established under section 107 of the Act, and Consumer Protection's page on it describes its purpose: to reimburse people who lose trust money or trust property through criminal or fraudulent actions by a licensed real estate or business agent, or by the agent's employees. The page says it is funded by contributions from agents and sales representatives, by interest on agents' trust accounts and by the interest the account itself earns.

The Act's word for what triggers a claim is defalcation. Section 4 defines it, in substance, as criminal or fraudulent conduct by a licensee, by the licensee's staff, agents or business partner, or by the directors and officers of a corporate licensee, in the course of the licensee's business, that causes another person a pecuniary loss or a loss of property.

According to the page, a claimant shows three things: a financial loss or a loss of property; that it resulted from a defalcation by a licensed agent or an employee; and that the defalcation occurred while the licensee held a current triennial certificate, or within six months after it ceased where the chief executive officer considers the circumstances reasonable. Only the actual loss is recoverable, less any benefits already received. The page lists exclusions and states no maximum payout.

The time limit is counted from knowledge. Written notice must reach Consumer Protection within three years of the claimant becoming aware of the defalcation, and the page says up to six years may be allowed where that is just and reasonable; a late claimant has 14 days to explain the delay. Once a claim is paid, Consumer Protection takes over the claimant's rights against the licensee to the extent of the payment. Section 23 of the Act gives a claimant a right to ask the State Administrative Tribunal to review a decision on a claim.

Fines and infringement notices

Section 84 makes any failure to observe Part VI an offence and sets three levels of penalty.

The A$600 notice and the A$25,000 maximum are different things. The first is the infringement penalty that Consumer Protection's audit page says may follow a report or declaration received after 31 March; the second is the maximum fine section 84 sets for an offence against the Part. What follows a late report depends on the case.

Liability does not stop at the company. Under section 84, where a body corporate commits an offence against the Part, every director, manager, secretary or other officer who commits, authorises or permits the act or omission commits the offence as well.

The agency keeps the books, but the auditor answers to the Commissioner, and so does the bank when an account slips below zero.

Kooky, from Shaka

Kooky edits Agents Estate and builds Shaka, the payment router he made for real estate professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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