Financial Advisors and Registered Investment Advisors (RIAs) can manually charge clients for services rendered through electronic invoices using Interactive Brokers’ (IBKR) Invoicing tool. This tool allows to manually calculate the fee and enter it into the system. Before submitting electronic invoices, an invoice limit must be approved by the client. This limit sets the maximum amount an advisor can charge on a monthly or quarterly basis and can be configured within the Fee Templates by selecting Invoicing and specifying the period (IBKR Traders´Academy, s.f.).
The invoice limit, expressed as an annualized percentage of the client’s Net Asset Value (NAV), is based on the client’s daily NAV from the previous period. The formula for the daily fee cap amount is: (Fee Cap % * NAV) / 252 = Daily Fee Cap (IBKR Traders´Academy, s.f.). The daily caps are summed to determine the total amount the advisor can invoice for that period. Clients need to approve this limit either electronically or via a paper form provided by Interactive Brokers.
To view pending invoice limit modifications, advisors can navigate to the home page and check the Pending Items box, which will show details on the request needing client approval. Once the client approves, advisors can submit electronic invoices by navigating through Administration & Tools, then Fees & Invoicing, and selecting Invoicing.
Invoices can be submitted for individual accounts by selecting the Create “+” sign and choosing the account from the Account Selector. The master and client account numbers, as well as the base currency, are auto-populated. The available fee amount reflects the approved invoice limit, adjusted for any prior invoices within the same period. Advisors enter the invoice amount and can optionally add a model or memo.
Alternatively, invoices can be submitted in bulk using a .CSV file with fields for the client account number and invoice amount. Optional fields include memo, model name, or a Money Manager account number (IBKR Traders´Academy, s.f.). Once submitted, the invoice amount is automatically transferred from the client account to the advisor’s master account. Invoices submitted by 5:30 PM EST are processed the same day, while those submitted after are processed the next business day.
Advisors can only submit one invoice per client account per day, and the invoice value cannot exceed the client-approved limit for the period.