Opening a Real Estate Trust Account in Queensland: Requirements and Approved Banks
You have your real estate licence. You are setting up your agency and the first practical task — before you take a deposit, before you receive a bond, before you collect a cent of rent on someone else’s behalf — is getting a compliant trust account in place. Get this wrong and you are not just looking at a fine. You are looking at a licence in jeopardy.
In Queensland, the legislation that regulates real estate trust accounts is the Property Occupations Act 2014 (POA) and the Agents Financial Administration Act 2014 (AFAA). These two Acts, which replaced the old PAMDA framework from 1 December 2014, now form the complete legislative basis for how a Queensland real estate agency establishes, operates, and accounts for its trust money. Understanding how they interact — and what each demands — is the first thing every new principal needs to get right.
The Legislative Framework Behind Opening a Real Estate Trust Account in Queensland
The POA and the AFAA aim to protect consumers from financial loss in dealings with agents, and the AFAA specifically regulates the way agents establish, manage, and audit their trust accounts. The POA sets out the general obligation to keep a trust account; the AFAA governs the precise mechanics of how that account must be operated.
Under the AFAA, the obligation to maintain a trust account falls on the licensee — that is, the person holding the real estate agent licence, not the individual salesperson. A salesperson working under a principal has no trust account obligations in their own name. The trust account belongs to the licence. When an agency operates as a corporation, the corporation’s licence governs the account.
Central to achieving its consumer protection objectives, the legislation requires persons who carry on business under the authority of a licence to maintain close personal supervision of the way the business is conducted. This is not a passive compliance tick. The principal is personally responsible for what happens in the trust account, which means oversight is not something you can delegate entirely to a property manager or accounts clerk and forget about.
The AFAA provides for the administration of trust accounts held by agents regulated under the Debt Collectors (Field Agents and Collection Agents) Act 2014, the Motor Dealers and Chattel Auctioneers Act 2014, and the Property Occupations Act 2014, and it establishes a claim fund to compensate persons in particular circumstances for financial loss arising from dealings with agents. That claim fund is a key detail: it is the statutory safety net that sits behind the trust account system, giving consumers recourse if an agent misappropriates funds. It is also why the legislation treats trust account compliance as a serious matter.
Who Must Open a Trust Account in Queensland
The obligation is triggered by function, not choice. A licensee who collects an amount of rent for a property owner must pay the amount to the licensee’s general trust account before the money can be paid from the account. The same principle applies to deposits on sales. If you hold money on behalf of another person in connection with a property transaction, that money must go into a trust account. It cannot sit in your operating account, even temporarily.
This catches agents quickly in practice. A principal who takes a deposit on a Friday afternoon is not permitted to hold that cheque over the weekend in their business account because the trust account is not yet set up. The sequence is clear: establish the trust account before you commence business. An agent must not pay to a trust account an amount other than an amount that must be paid to the account, with a maximum penalty of 200 penalty units or one year’s imprisonment. The converse obligation — paying trust money into the account — carries its own penalties if it is delayed or avoided.
Salespersons and property managers employed by a licensee do not hold trust accounts personally. Their obligations flow through their employer’s licence. This is a structural point that also matters when an agent leaves one agency and moves to another: they do not carry any trust account obligations with them, and they cannot take trust money with them.
Opening a Real Estate Trust Account Queensland Requirements: The Bank and Account Setup
Using an Approved Financial Institution
The most common practical question new principals ask is: which bank can I use? The answer is that the trust account must be held with a financial institution that is a branch operating within Queensland. The agent must pay the amount to a special trust account with a branch of a financial institution within the State operated for the investment of the amount.
The term ADI — authorised deposit-taking institution — is central to understanding the bank requirement. The term ‘ADI’ is defined as an authorised deposit-taking institution within the meaning of the Banking Act 1959 (Cth). This means the institution must be authorised by APRA (the Australian Prudential Regulation Authority) to take deposits from the public. Non-bank lenders, credit cooperatives without APRA ADI status, online neobanks that are not ADI-registered, and foreign institutions without an Australian branch cannot hold your trust account.
In practice, this means the major Australian banks — ANZ, Commonwealth Bank, Westpac, NAB — as well as BOQ, Bendigo Bank, and other APRA-authorised ADIs with Queensland branches are the realistic options. The BOQ Real Estate Trust Account is available to licensed property agents and motor dealers to hold funds in trust for clients in QLD only, and it complies with trust account legislative requirements in the Property Occupations Act 2014, Agents Financial Administration Act 2014, Motor Dealers and Chattel Auctioneers Act 2014, and Trust Accounts Act 1973 (QLD). Banks that specifically market trust account products to Queensland real estate agents have generally aligned their product terms to the legislative requirements, which simplifies the setup process. Agents using a bank that does not have a specific real estate trust account product should confirm in writing with the bank that the account structure complies with the AFAA before operating the account.
Account Naming Requirements
The naming of the trust account is not a minor administrative detail — it is a legal requirement. The account name must clearly identify it as a trust account and must include the name of the licensee or, if held by a corporation, the name of the corporation. The words “Trust Account” must appear in the account name itself. This ensures that the bank, clients, and auditors can immediately identify the account’s character and that funds cannot be confused with the agency’s operating money.
Licensees must notify the deposit-taking institution in writing that the account is a ‘trust account’. If a corporation holds the account, it must be in the corporation’s name. Otherwise, it must be in the licensee’s or firm’s name. The words ‘Trust Account’ should appear on all documentation.
A typical compliant account name for a sole licensee might read: J Smith Trust Account. For a corporate licensee: Smith Realty Pty Ltd Trust Account. If the agency uses a business trading name and the bank permits it, the trading name can also be incorporated provided the licensee or corporation name is still clearly present.
Notifying the OFT
The AFAA requires that an agent notify the chief executive (in practice, this means the Queensland Office of Fair Trading) when a trust account is opened, closed, or has its name changed. This is an active obligation — you cannot simply open an account and begin operating it without notifying the regulator. The same notification requirement applies if you close the account or change its name. Agents who change banks or restructure their business must ensure they update their notification accordingly.
This is a step that is easy to overlook in the practical rush of setting up a new agency, and it is exactly the kind of omission that creates compliance issues at audit time.
General Trust Accounts and Special Trust Accounts
There are two types of trust accounts relevant to real estate agents in Queensland. Understanding the difference matters practically.
The general trust account is the primary operating account. A licensee who collects an amount of rent for a property owner must pay the amount to the licensee’s general trust account before the money can be paid from the account. All sales deposits, rental income awaiting disbursement, bonds, and other client monies flow through the general trust account. This is the account your auditor will primarily examine.
The special trust account is an investment vehicle. A property agent under the Property Occupations Act 2014 may invest an amount under the special trust account provisions if required by written direction, paying the amount to a special trust account with a branch of a financial institution within the State operated for the investment of the amount. In practice, this arises when a client directs you to place their funds on interest-bearing deposit while awaiting settlement or resolution of a matter. The interest earned is the client’s money, not the agency’s. The special trust account is always opened at a client’s written direction — it is not a general facility.
The AFAA also makes clear that an agent does not need to operate multiple separate general trust accounts for different types of transactions. A single general trust account can hold sales deposits and rental income simultaneously, provided the record-keeping within the account — through separate client ledgers — properly identifies and segregates each client’s funds. This is an important practical point for small agencies managing both sales and property management from a single trust account.
Record-Keeping, Receipting, and Reconciliation Requirements
Opening the trust account is just the beginning. The AFAA imposes ongoing obligations that are the operational substance of trust account compliance.
Every amount received into the trust account must be receipted immediately. Receipts must be numbered consecutively, must record the amount received, the name of the person paying, the date, and the purpose for which the money is held. This receipting obligation is not discretionary and applies whether the money arrives by cash, cheque, EFT, or direct debit.
A licensee and person in charge must personally supervise, manage, and control the conduct of the business and must take reasonable steps to ensure each employee is properly supervised and complies with the legislation. In practice, this means the principal should be reviewing trust account activity regularly — not simply at audit time. Monthly bank reconciliations should be completed by the end of the first week of the following month. The reconciliation must balance the bank statement against the trust account cash book and the total of all client ledgers. If those three figures do not agree, the discrepancy must be identified and corrected before the end of the month.
Trust account records must generally be kept for at least five years after the last entry. This applies to receipts, payment authorities, client ledgers, cashbooks, bank statements, and reconciliation records. The AFAA further requires that these records be available for inspection by an authorised auditor or OFT investigator on demand.
Controlling Access to Prevent Fraud
Approval processes involving high-risk activities, including receipting trust monies to ledgers, creation of new trust creditors, receipt and disbursement of bonds, and credit entries are among the activities requiring appropriate supervisory oversight. The OFT has been consistent in advising principals to implement internal controls that separate the functions of receiving, receipting, and authorising disbursements where the size of the agency permits.
Limit access to trust account transactions to only a handful of employees, but never just one employee. This dual-control principle is the single most effective internal fraud prevention measure available to a principal. An agency where only one person has any knowledge of or access to trust account transactions is structurally vulnerable.
The Annual Trust Account Audit
Every real estate agent who holds a general trust account in Queensland must have that account audited annually by a qualified, independent auditor. Trust account audits must be conducted by qualified, independent professionals. A trust account auditor must be either a registered company auditor under the Corporations Act 2001 or a qualified accountant with a current practising certificate from CPA Australia, CA ANZ, or IPA. Auditors must be independent with no personal, financial, or business interest in the agency.
Queensland’s real estate trust account audit requirements allow four months after the audit period end. The audit period runs from 1 July to 30 June, so the audit report is due by 31 October of each year. The agent must appoint an auditor and notify the OFT of that appointment. The AFAA requires this notification — the auditor is not simply a private arrangement between the agent and an accountant.
The auditor’s report goes directly to the OFT, not just to the agent. If the auditor identifies a deficiency — a shortfall, a breach of the receipting rules, or a reconciliation that does not balance — they are required to report it to the regulator. This is a critical structural feature of the audit regime: the auditor’s duty runs to the public interest, not solely to the agent who pays their fee.
Trust account audits occur annually at the end of each financial year. An agent who closes their trust account during the year (for example, because they have ceased to operate or surrendered their licence) is required to undergo a special audit at the point of ceasing operations. This requirement catches many agents by surprise.
What Cannot Go Into a Trust Account
Understanding what must not be deposited into the trust account is as important as knowing what must go in. An agent must not pay to a trust account an amount other than an amount that must be paid under the relevant provisions, with a maximum penalty of 200 penalty units or one year’s imprisonment.
This prohibition prevents agents from using the trust account as a general-purpose business account. Operating expenses, wages, GST payments, office supplies, and the agent’s own funds must never touch the trust account. The trust account holds other people’s money. It is ring-fenced by law, meaning that trust money is not available to the agent’s creditors. That protection only holds if the account is kept clean.
Commission, once earned, must be drawn from the trust account through a proper payment authority and disbursed to the agency’s operating account in the correct way. The trust account is not the place to hold unclaimed commission or to park money that is in dispute. Unclaimed trust money that cannot be disbursed has its own legislative pathway under the AFAA and ultimately to the Public Trustee if it remains unclaimed over the required period.
What This Means for Queensland Agents
Opening a trust account compliant with the AFAA and POA is a prerequisite, not an afterthought. For principals setting up a new agency, the sequence must be: choose an APRA-authorised ADI with a Queensland branch; open the account with the correct statutory name; notify the OFT of the account’s opening; appoint an auditor; and establish internal controls before the first cent of client money is received.
The bank matters less than the process. While the major banks and BOQ offer purpose-built Queensland real estate trust account products, any ADI with a Queensland branch and a willingness to hold the account in a compliant structure will satisfy the legislative requirement. Confirm this in writing before operating the account.
Once trading, the three recurring obligations that most often create compliance issues at audit time are: failing to reconcile monthly, allowing a single staff member to control all trust account access, and treating OFT notification obligations as optional. None of these are minor. The OFT recommends that all real estate principals have written procedures for staff, ensure all employees understand how the record-keeping system operates including its capabilities and limitations, and ensure staff know to report all concerns or suspicions regarding financial mismanagement to the licensee immediately.
For new principals coming from interstate — particularly New South Wales or Victoria — the Queensland framework has several features worth noting. The audit report goes to the OFT directly, the period is financial-year-based with a 31 October deadline, and the AFAA’s treatment of special trust accounts and client investment directions differs from the equivalent provisions in other jurisdictions. Do not assume that systems built for another state will automatically satisfy Queensland requirements.
The trust account is the most heavily regulated aspect of a real estate agency’s financial operations. It is also the one where getting it wrong has the most direct consequences for your licence, your reputation, and the clients whose money you hold.
Agents should consult the current versions of the Agents Financial Administration Act 2014 and Property Occupations Act 2014 on legislation.qld.gov.au for the operative provisions applicable to their specific circumstances. The Office of Fair Trading at qld.gov.au is the relevant regulatory contact for trust account notifications and compliance queries.