The Trust Administration Fee (TAF) of $15 + tax is a one-time charge to clients/matters, charged if a lawyer handles trust funds not used as a retainer or as payment for client expenses. This applies to trust funds received on or after March 1, 2005. Clients/matters are not charged the TAF twice. Lawyers also have the option of recording the fee as a disbursement to the firm, rather than charging it to the client/matter.
Lawyers must remit the trust administration fee collected or allocated to a client file for the previous quarter within 30 days of the end of that quarter (Rule 2-110).
Remittances must be received by the Law Society by:
April 30 (for remittances covering the three-month period ending March 31)
July 31 (for remittances covering the three-month period ending June 30)
October 31 (for remittances covering the three-month period ending September 30)
January 31 (for remittances covering the three-month period ending December 31)
How to record Trust Administration Fee (TAF) Entries
CosmoLex has a built-in system to record and remit Trust Administration Fees. Read on to learn learn how.
Before You Get Started
- If you intend to pay Trust Admin Fee as a normal firm expense and not charge to clients, create a separate chart of account of type Expense and title it “Trust Admin Fee Expense”. Not sure how? Learn how to create a chart of account.
- Create your law society as a payee for convenience and quick entry. Learn how to add a payee.
- \Make sure you have set a default Timekeeper in your settings. Learn how to set a default timekeeper.
If you haven’t already done so, set up your regional settings to select your province. Learn more about the regional setting.
You will find additional settings here for the Trust Admin Fee.
How Fee Amount Will Be Handled
- Bill to Client – select if you will be charging the client for this fee. This option will create a disbursement for the matter and you will be able to include that disbursement in the client’s invoice.
- Firm Expense – select if your firm will be paying this fee. This option will create a business expense, as if you were entering payments for items such as office supplies, rent, etc.
The default amount of the type of fee. This is based on current regional mandates and cannot be changed from this screen. However, if there is a special case, the amount can be changed on a matter-by-matter basis when creating the Trust Admin Fee entry.
Bill to Client
- Expense Item: Use the default or type in the name you would like this type of expense to show when created.
- Taxable: The default for this field is Yes. When billing a client, for example, the fee on the invoice will include tax.
- Account: This shows the chart of account these fees will be recorded under
Firm Expense Account
Use this to designate the chart of account you would like to assign these entries to, if they are to be tracked as firm expenses.
Firm Filing ID
Use this field to list your filing ID
How to Create
When you are ready to create your Trust Admin Fee, follow the steps below:
- From the Matters Tab, select desired Matter and click Action
- Mouse over Trust Admin Fee, and click Create
- Complete Trust Admin Fees Form
- Date – date trust admin fee was incurred
- Payable Mode – select an option to designate this fee’s payable status
- Ignore: use this option if you have already paid this fee and do not wish to include it in your payables at the end of the quarter. This is useful if you are logging historical entries.
- Exempt: use this option if this particular matter is exempt from the fee
- Payable: use this option if you would like to pay for this fee at the end of the quarter
- Amount – this amount is the same as the firm-wide amount shown in Regional Settings, and it is our recommended amount for the matter according to its open date. If you wish to change this amount, click the lock icon to edit.
- Billing – this option will default to the setting selected for them firm in Regional Settings. You may change it here, if needed.
- Taxable – if this fee is payable, you will have the option of selecting whether it is taxable or not. As per regional settings, this will default to yes.
- Click Save.
All set! You have now logged a new fee for this matter. If the fee is to be billed by the client, you can include it in your invoice as you would other matter expenses / disbursements.
How to Search and Edit
After you have entered your trust admin fees, you may need to search for them to review which matters you have already applied a fee to, and which matters do not have an associated entry yet. Use our new search filter to find your entries.
1. From the Matters Tab, click on Advanced Search
2. Scroll down and find the filters related to trust admin fees. You may select your desired parameters and view the results on the screen.
To Edit a Trust Admin Fee
1. From the Matters tab, select the desired matter and click Action
2. Mouse over Trust Admin Fee, and click Edit
To Remove a Trust Admin Fee
Expense cards associated to trust admin fees may not be deleted. In order to remove a trust admin fee, follow the step above to edit the entry, then click Remove.
How to Pay
At the end of the quarter, you will want to pay all relevant trust admin fees at once. To do so, follow these instructions:
- From the Matters tab, select Action
- Mouse over Trust Admin Fee, and click Pay
- In the payment screen, there is an automatic filter to show only entries for ‘last quarter.’ Use the search filter on the right to find the levies you’d like to pay.
- Click Next
- Provide Payment Details Bank – Confirm the desired bank is selected
- Amount – total amount of fees selected
- Date – date of payment
- Transaction Type
- Check – use this option if you would like to write a check or print one using CosmoLex
- Wire/ACH-Out – use this option if you are paying your fee electronically
- Transaction Method – use the appropriate method of payment. For example, you may choose Electronic Funds Transfer if you have selected Wire/ACH-Out as the transaction type
- Payee – Type the name of the payee (i.e. Law Society of Ontario)
- Check # – If you have selected check as transaction type, and have selected not to print from CosmoLex, type the associated check number here.
- Memo – enter an appropriate memo note
- Click Next
- Review Summary of transaction and click Pay
Trust Admin Fee Reporting
- From the Matters Tab, click Action
- Mouse over Trust Admin Fee and click Report
- Complete the Report Options screen
- Entry Date – select the desired date range for entries
- Print Format – select PDF or .csv format for downloading and printing
- Click Print