‘MFDs can charge fees for services like will planning and tax filing’

One of our readers wrote to us with this query:

I am a mutual fund distribution and currently, running a private limited company. I would like to offer services like tax filing and estate planning. I would like to understand if I can charge my clients for these services. If yes, how can I raise bill.

Name withheld on request

Dear MFD,

Thanks for writing to us.

There is no regulation that stops mutual fund distributors from selling other financial products and services like tax filing or will planning.

While mutual fund distributors cannot charge fees in lieu of financial advice and mutual fund investments, there is no restriction on MF distributors to charge fees to sell or offer other financial products or services.

In fact, there are MFDs who offer these services for fees. These services don’t fall under financial advice and hence, you may not face any regulatory issue.

On raising a bill, you may use your company’s invoice to issue a bill to your clients. Don’t forget to mention that you are AMFI registered mutual fund distributor in all your communication to comply with the AMFI’s code of conduct for distributors.

Disclaimer: Please note that we spoke to a few industry experts like members of AMFI ARN committee, senior MFDs/RIAs and MF officials before writing this story. Request you to practice your own due diligence before making any material decision.