SEBI IA Fee Limits 2026: AUA vs Fixed, Explained
Short answer
The two modes side by side
| AUA-based | Fixed | |
|---|---|---|
| Limit | Up to 2.5% of assets under advice a year | Up to ₹1,51,000 per family a year |
| Scales with | The client’s portfolio value | Nothing: a flat amount |
| Best for | Larger portfolios, ongoing review | Smaller portfolios, planning-heavy work |
| Hard part | Measuring AUA honestly each period | Adding up every plan in the family |
| Client sees | A fee that moves with the market | A predictable bill |
The limit is a ceiling, not a target. Most advisers sit well under 2.5% on larger portfolios, and the fixed ceiling bites mainly on households with several family members on separate plans.
The family rule, where the arithmetic goes wrong
The fixed limit is per family, not per client record. A household of a husband on ₹8,000 a month and a wife on ₹4,000 a month already pays ₹1,44,000 a year. Add a ₹2,000 monthly plan for their HUF and the family is at ₹1,68,000, over the limit, even though no single plan looks large.
Choosing between AUA and fixed
AUA suits ongoing portfolio advice on larger books: the fee grows with the work and the client sees the link. Its weak point is measurement. Value the advised holdings the same way every period and keep the calculation with the invoice, because that is what an inspection checks.
Fixed suits planning-heavy engagements and smaller portfolios where 2.5% would not pay for the work. It is predictable for the client, and the only hard rule is the family total. Whichever you choose, write the mode, the amount or rate and the billing interval into the advisory agreement.
Advance fees and refunds
Since the SEBI circular of 2 April 2025, advisers may bill up to one year in advance if the client agrees; the earlier limit was two quarters. If the engagement ends early, the fee for the unexpired period goes back to the client. Collect fees through banking channels only, never cash.
Checking it without a spreadsheet
The free fee-limit calculator adds up a family’s plans or checks an AUA rate in seconds. Inside Aktai the same check runs on every fee plan you create: link clients into a family and a plan that would push the household over the limit is rejected. AUA is computed from the live market value of the client’s recorded holdings. See how it works.
Frequently asked questions
What is the maximum fee a SEBI Investment Adviser can charge?
For individual and HUF clients: up to 2.5% of assets under advice a year in AUA mode, or up to ₹1,51,000 per family a year in fixed mode. One mode applies per family at a time.
Do the IA fee limits apply to companies and accredited investors?
No. The limits cover individual and HUF clients. Accredited investors and non-individual clients agree fees with the adviser bilaterally, and the agreed terms go in the advisory agreement.
Can I charge a performance fee or a share of profits?
No. An Investment Adviser’s fee is either a share of assets under advice or a fixed amount, within the limits. Profit-sharing and performance-linked fees are not part of the IA fee regime.
How far in advance can an IA bill?
Up to one year of fees, if the client agrees, under the SEBI circular of 2 April 2025. Before that the limit was two quarters. If the client leaves early, the fee for the unexpired period is refunded.
How do I calculate assets under advice?
Use the current market value of the holdings you advise on for that client, measured the same way each billing period, and keep the calculation with the invoice. Holdings you do not advise on stay out.
Related reading
General information, not legal or compliance advice. SEBI rules change: check the current SEBI Investment Advisers Regulations, the Master Circular for Investment Advisers and recent circulars, and confirm your own position with your compliance officer.