By: Jessica Darnbrough
The MFAA has successfully lobbied ASIC to amend the fee structure for sole traders outlined in the National Consumer Credit Protection Act.
Under the original Act, all incorporated companies would be required to pay a licence fee of $1,000 per annum, regardless of whether or not they were a sole trader operating through a company vehicle.
“When the fee structure was first discussed, we were led to believe that sole traders would only have to pay $450 for a licence each year,” MFAA chief executive officer Phil Naylor told The Adviser.
“However, when the regulation came out it said that any company would be required to pay $1,000. As such, any sole traders that were incorporated would also be required to pay this fee.”
“We made a complaint to Treasury, who have since amended the Act.”
Under the amendments, a sole trader is now defined as any natural person, or a person that has only one representative that engages in credit activities.
Separately, ASIC has clarified that licensees conducting servicing and other intermediary activities which are not directly related to lending or arranging a loan will pay $450 for a sole trader and $1,000 for other companies.
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