The Financial Services Authority is proposing a change in the way it calculates regulatory fees for adviser firms.

The idea was put forward in a consultation paper published today (28 October) entitled ‘CP11/21 Regulatory fees and levies’.

The FSA wants to change from calculating regulatory fees based on the number of approved persons in the firm to the firm’s regulated income.

The report states: “We plan to replace the headcount of approved persons with an income measure for fee-blocks A.12, A.13 and A.14 from 2013/14.”

Most adviser firms fall into the A.13 category as “advisory arrangers, dealers or brokers (not holding or controlling client money or assets or both).

The FSA first proposed this idea back in 2004 but dropped it following a survey of 1,500 firms which decided a headcount would be easier to administer.

The current changes are due to the headcount not taking into account staff who worked part-time or had a job-share arrangement, potentially hindering staff career development.

The report states: “We propose an income measure which will simplify the administration while at the same time removing any theoretical risk of adversely having an impact on good practice in equalities.”

Regulated income will cover the amount of income from advisory and consultancy charges, brokerages, fees, commissions and any other related income from regulated activities.

The FSA plans to implement the new tariff base for 2013-14 using data based on firms’ financial years ending during 2012.