Client account or TPMA: What’s the difference?
Summary
The article explains the difference between traditional client accounts and third-party managed accounts (TPMAs), noting that TPMAs have been permitted since 2017 but are attracting renewed interest as client money handling comes under closer scrutiny. It also highlights that firms using TPMAs still retain important responsibilities, including client disclosure, oversight, and checks on the provider’s regulatory status.
Why it matters
Residential property surveyors may encounter transactions where client money arrangements affect how funds are held and moved, particularly where firms adopt alternative payment structures. Understanding the distinction between client accounts and TPMAs helps surveyors recognise the compliance implications and the need for clear client communication.
Key points
- TPMAs are held with a bank or building society and operated by a third party as an escrow-style payment service.
- Money in a TPMA is not treated as client money under the SRA Accounts Rules.
- Firms still control payment instructions and remain responsible for client understanding and oversight.
- Rule 11 obligations include providing statements and checking the provider’s regulatory standing.
- The article notes that FCA-authorised providers must be used.
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