New Zealand Legislation: Regulations

6 Trust accounts not to be overdrawn

• (1) If the trust accounts held by a practice for a particular client, taken as a whole, would, but for compliance with this subclause, be overdrawn, the practice must immediately lend to that client the amount necessary to prevent the trust accounts of that client being overdrawn.

  (2) Any amount lent by a practice to a client under subclause (1) must be lent directly, or indirectly through an advance account, from the practice’s own funds.

  (3) No advance account of the practice, or other account representing a sole practitioner’s, partner’s, or voting shareholder’s own interest in the trust accounts, may be overdrawn at any time.

  (4) In this regulation, advance account means an account (however described) in which funds of a practice are kept for the purpose of loans to clients whose trust accounts would otherwise be overdrawn.