SEBI Guidance on RA Fee Cap for Individual and HUF Clients

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  • Last Updated on 26 September, 2025

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SEBI fee cap for Research Analysts

Informal Guidance No. SEBI/HO/MIRSD-POD/P/OW/2025/25279/1, Dated 24.09.2025

1. Introduction

The Securities and Exchange Board of India (SEBI) has issued an interpretive letter under the Informal Guidance Scheme, 2003 in response to a query raised by Equitymaster Research Pvt. Ltd. The letter provides clarity on the scope and applicability of fee-related provisions introduced under the Research Analyst (RA) Regulations earlier this year.

2. Clarification on Fee Cap

SEBI clarified that the annual fee cap of ₹1,51,000 per family, which came into effect on 8 January 2025, is applicable to all individual and Hindu Undivided Family (HUF) clients, without exception. This means that even existing clients of research analysts fall within the ambit of the new fee cap, thereby standardising charges across both new and ongoing relationships.

3. Compliance Requirements for Research Analysts

The interpretive letter further reiterates that Research Analysts (RAs) must comply with the fee-related provisions specified under the RA Regulations. This includes the obligation to ensure that fees collected from clients do not breach the prescribed cap, and that fee structures are transparent and compliant with the regulatory framework.

4. Refund of Advance Fees

One of the key compliance requirements highlighted by SEBI is the refund of advance fees collected by research analysts beyond a period of one year. This ensures that clients are not charged excessively in advance and that the fee structure remains fair and proportionate to the services provided. SEBI directed that research analysts were required to align with these provisions by 30 June 2025, giving them a clear compliance timeline.

5. Conclusion

Through this interpretive letter, SEBI has provided much-needed clarity on the implementation of fee-related provisions under the RA Regulations. By extending the ₹1,51,000 per family cap to all clients, including existing ones, and mandating refunds of excess advance fees, SEBI has reinforced its commitment to investor protection and fair market practices. The guidance ensures consistency, compliance, and greater transparency in the research analyst industry, strengthening trust between analysts and their clients.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied