LPFF: Compulsory Automation of Trust Interest Receipts

Posted 28 July 2025 Written by Acts Online
Category Justice

Brought to you by SA Accounting Academy: The Legal Practitioners’ Fidelity Fund (LPFF) has announced the compulsory automation of trust interest receipts following an amendment to the Legal Practice Council (LPC) rules.

In terms of amended Rule 54.14.16 of the Legal Practice Act, No. 28 of 2014, all interest accrued on Section 86 trust banking accounts (specifically those referred to in section 86(5)) must be transferred by the banking institution directly to the LPFF. This transfer must occur within five working days after the end of the calendar month in which the interest vested in the Fund, utilizing the Automated Monthly Transfer Systems (AMTS).

The implementation of this compulsory automation is set for 1 September 2025. From this date, all interest that vests with the Fund will be ‘swept’ by banks that have entered into formal banking arrangements with the LPFF as provided for under Section 63(1)(g) of the Legal Practice Act, No. 28 of 2014.

Key Compliance Requirements

  • Mandatory Integration: Legal practitioners maintaining Section 86 trust accounts that are not currently integrated into their bank’s AMTS must coordinate with their financial institutions to ensure compliance before the September 2025 deadline.
  • Transfer Window: The bank must execute the transfer within five working days following the end of each calendar month.
  • Vesting: The rule applies specifically to interest that vests in the LPFF under Section 86(5) of the Act.

The LPFF has provided a three-page communication document and an Annexure A detailing the practical application of the amended rule to assist practitioners and auditors in the transition.

Click here to access the gazetted notice on the amendment to Rule 54.14.16.

Click here to download the LPFF communication document.

What this means for you, your business, or your clients

  • For yourself: Monitor the transition to automated sweeping to ensure that manual transfer processes are discontinued by 1 September 2025, preventing potential double-payments or reconciliation errors in the trust ledger.
  • For your business: Law firms must immediately engage with their banking providers to confirm that all Section 86 trust accounts are correctly configured for the Automated Monthly Transfer Systems (AMTS) to meet the new regulatory deadline.
  • For your clients: Auditors must update their 2025/2026 audit programs to verify that the bank, rather than the practitioner, is initiating the transfer of Section 86(5) interest to the LPFF within the required five-day window.

Originally published at https://accountingacademy.co.za/news/read/lpff-compulsory-automation-of-trust-interest-receipts

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