My B--t-rd Accountant

[Horsetan]

....someone offering/ calling themselves 'accountancy services' will unlikely be a qualified chartered accountant.

 

Book-keeper, surely?

[Jonboy]

Book-keeper, surely?

Nope, nothing like that as a distinction. Anyone can call themselves an accountant and offer to do your accounts and taxes, but you will always remain legally liable...the only major thing restricted to chartered accountants is financial audit work ( in particular the signing thereof).

[jjb1970]

At the risk of taking this off topic, to me the problem isn't so much about accountants (although there are issues there, as highlighted by Edwardian's predicament) but rather why is the tax code so complicated that people need to use accountants?

[chris p bacon]

At the risk of taking this off topic, to me the problem isn't so much about accountants (although there are issues there, as highlighted by Edwardian's predicament) but rather why is the tax code so complicated that people need to use accountants?

 

Depending on what you need doing a lot of the work is simple and straightforward. Most I know get their payroll done by accountancy firms and they charge a minimum rate plus an amount per employee. HMRC actually give you all the info as well as calculators to do it yourself. An example was those I had as PAYE, it took me less than 1 hour a month to do the payroll whereas another I know paid just over £700 a year for the same amount of work. I remember when I showed him he said how they'd made out it was really difficult and that only 'accountants' could do the work as HMRC wouldn't accept from anyone else.

[Legend]

Payroll is relatively simple . In my day you did it with tables . Look up the code for tax free pay, then another table for taxable. These days I suppose there will be a simple computer program to do it. It's not rocket science but I suppose it takes up time, that might be better spent developing your business. A lot of businesses contract this out. You don't need a CA to do this , though. There will be lots. Of agencies that can do this at a competitive price.

Edited October 18, 2017 by Legend

[Alex TM]

Payroll is relatively simple . In my day you did it with tables . Look up the code for tax free pay, then another table for taxable. These days I suppose there will be a simple computer program to do it. It's not rocket science but I suppose it takes up time, that might be better spent developing your business. A lot of businesses contract this out. You don't need a CA to do this , though. There will be lots. Of agencies that can do this at a competitive price.

Hi everyone,

 

Accounts and finance are usually something that leave me cold, however the matter of making sure staff are properly paid, and on time, is something that does matter to me.  Our payroll, I am told, took a couple of hours to set up, and works in a real-time set-up using HMRC's own software.  Our payroll is done by someone who is numerate but with no financial or accountancy training; she declared how straightforward it was/is.  (We are a small charity with a small number of employees but, according to the information from HMRC, it can work the same way for bigger companies).

 

To return to the OP, even if this 'accountant' isn't registered with a professional body, I wonder if some aspect of contract law would be applicable.

 

Hope this is of interest.

 

Regards,

 

Alex.

[antrobuscp]

HMRC's free payroll software for up to 10 employees works quite well, and is not difficult to use. Sometimes it is the rules surrounding SSP or SMP which are more fiddly. A lot of small business people feel they are better spending their time promoting and running the business rather than doing the "back-office" work themselves or, they are too "knackered" at the end of the day to do the chores.

 

You pays your money and takes your choice. 

 

Yes, the tax code is far too complex. When I first qualified(1972) the "Yellow tax handbook" we used was very thick, but all the pages were "proper" paper. I can't remember how many pages, but let's say 1500. By the time I retired (2015) there were 3 volumes printed on tissue paper and there must have been  three or four times the number of pages. In addition there were similar volumes covering Inheritance Tax, and two for VAT, which didn't exist in 1972 - Purchase tax back then applied to far fewer businesses.

 

Colin

Edited October 18, 2017 by antrobuscp

[hayfield]

HMRC's free payroll software for up to 10 employees works quite well, and is not difficult to use. Sometimes it is the rules surrounding SSP or SMP which are more fiddly. A lot of small business people feel they are better spending their time promoting and running the business rather than doing the "back-office" work themselves or, they are too "knackered" at the end of the day to do the chores.

 

You pays your money and takes your choice. 

 

Yes, the tax code is far too complex. When I first qualified(1972) the "Yellow tax handbook" we used was very thick, but all the pages were "proper" paper. I can't remember how many pages, but let's say 1500. By the time I retired (2015) there were 3 volumes printed on tissue paper and there must have been  three or four times the number of pages. In addition there were similar volumes covering Inheritance Tax, and two for VAT, which didn't exist in 1972 - Purchase tax back then applied to far fewer businesses.

 

Colin

 

It will always be far cheaper doing it yourself than to pay for others to do it, accountancy costs are like every thing else once they get staff and premises the costs just sky rocket, rents, business rates etc, staff wages and benefits. Many small businesses suffer from having to greatly increase costs when they try and expand. When I had an accountant doing my simple accounts, I expect it took him longer to see me and explain than do it, but it was one thing less for me to do. I now have to do a tax return each year, takes me longer to find the information than fill in the return

 

This does not excuse what the accountant has done, but explains the high charges 

[antrobuscp]

It will always be far cheaper doing it yourself than to pay for others to do it, accountancy costs are like every thing else once they get staff and premises the costs just sky rocket, rents, business rates etc, staff wages and benefits. Many small businesses suffer from having to greatly increase costs when they try and expand. When I had an accountant doing my simple accounts, I expect it took him longer to see me and explain than do it, but it was one thing less for me to do. I now have to do a tax return each year, takes me longer to find the information than fill in the return

 

This does not excuse what the accountant has done, but explains the high charges 

It will always be cheaper doing it yourself, so long as you do it right, and you are correct regarding some of the reasons why accountancy fees are as high as they are. Simple accounts are relatively quick and easy to do so long as records are kept in an organised fashion. There are various rules that are simple in themselves but they require attention by the do-it-yourself taxpayer or you can end up with a tax enquiry(and they can happen anyway). To a qualified(by experience or formal qualification) person a lot of the rules are just built in to the way you think and approach the work.

 

The meeting with the client to "see you and explain" is, to me, an integral part of the work, and many's the time at such a meeting that I became aware of material information, not otherwise noted or mentioned,  relating to the accounts or otherwise necessary to properly advise on or plan their affairs.

 

I would be very unhappy at the situation in which Edwardian finds himself, and I would have thought that the fee issue should have been identified and acted upon at an earlier point.

 

Colin

Edited October 18, 2017 by antrobuscp

[chris p bacon]

 you can end up with a tax enquiry, and they can happen anyway. To a qualified(by experience or formal qualification) person 

 

But that's not a problem as every year they send me an invitation to pay for their "tax enquiry insurance' in case I should be picked for an enquiry.

 

My answer is that if something is wrong and gets flagged up by HMRC I'd want to know why they didn't spot it,  The reason that comes back is that I could be chosen at random and that an 'interview' with HMRC would cost £2-3000. 

 

I've not paid any of these 'invitations' and the running total if I had would be just over £7,500 .....I nice little earner for no work.

[duncan]

^{turf accountant}            

Edited October 18, 2017 by duncan

[Horsetan]

....I've not paid any of these 'invitations' and the running total if I had would be just over £7,500 .....I nice little earner for no work.

 

But that's the principle underlying any sort of insurance. Effectively it's a (in some cases mandatory) bet that you won't need to use it.

[antrobuscp]

But that's not a problem as every year they send me an invitation to pay for their "tax enquiry insurance' in case I should be picked for an enquiry.

 

My answer is that if something is wrong and gets flagged up by HMRC I'd want to know why they didn't spot it,  The reason that comes back is that I could be chosen at random and that an 'interview' with HMRC would cost £2-3000. 

 

I've not paid any of these 'invitations' and the running total if I had would be just over £7,500 .....I nice little earner for no work.

Enquiry insurance is not something we ever "pushed" to clients. We felt we didn't see so many enquiries as to make it necessary. We did tell clients that such cover was available if we were asked about it. Sometimes business package insurance includes some cover, as did(does?) membership of certain bodies. I think Federation of Small Business offered something. Full tax enquiries are costly to deal with if you are unfortunate enough to drop for one - in both time and money.

 

There are many reasons why a case may be picked for enquiry, including the random exam. Many of them are caused by issues the accountant would be unaware of. In my experience the annual client meeting sometimes caught such issues. Certainly, an accountant looking at a client's accounts/returns with a critical eye may have an inkling of some factor increasing the risk of an enquiry. If that were the case I would discuss the problem with the client to try and deal with it. Frequently, it could be as simple as placing an explanatory paragraph into the return and/or in the accompanying letter.

 

Colin

[rockershovel]

I’ve had two enquiries over time, given some of the things which appear in my accounts I just regard it as an occupational hazard. One cost me around £4000 to deal with, and I couldn’t possibly have done it myself. The other cost considerably more, was quite complex but again, I’m still ahead on the balance of money claimed back over time.

 

So it goes.

[hayfield]

It will always be cheaper doing it yourself, so long as you do it right, and you are correct regarding some of the reasons why accountancy fees are as high as they are. Simple accounts are relatively quick and easy to do so long as records are kept in an organised fashion. There are various rules that are simple in themselves but they require attention by the do-it-yourself taxpayer or you can end up with a tax enquiry(and they can happen anyway). To a qualified(by experience or formal qualification) person a lot of the rules are just built in to the way you think and approach the work.

 

The meeting with the client to "see you and explain" is, to me, an integral part of the work, and many's the time at such a meeting that I became aware of material information, not otherwise noted or mentioned,  relating to the accounts or otherwise necessary to properly advise on or plan their affairs.

 

I would be very unhappy at the situation in which Edwardian finds himself, and I would have thought that the fee issue should have been identified and acted upon at an earlier point.

 

Colin

 

 

Colin

 

I think we mainly agree, when in business I felt the cost of using an accountant was well justified not only in saving me time but also keeping me the right side of the taxman. I also agree that a face to face meeting was useful in explaining what was going on, my analogy of time was purely to show there is more to accountancy than just constructing a set of accounts and completing a tax return.

 

Now I just have to complete a simple tax return, which is a statement of fact in monies received and tax + NI contributions paid. The assessment calculates any outstanding liability.

[kevinlms]

But that's not a problem as every year they send me an invitation to pay for their "tax enquiry insurance' in case I should be picked for an enquiry.

 

My answer is that if something is wrong and gets flagged up by HMRC I'd want to know why they didn't spot it,  The reason that comes back is that I could be chosen at random and that an 'interview' with HMRC would cost £2-3000. 

 

I've not paid any of these 'invitations' and the running total if I had would be just over £7,500 .....I nice little earner for no work.

But I think you'll find that there is a little waiver, just above where you signed, that the income tax form so presented, is based upon the information that YOU provided to the accountants. So that includes any business income & expenses.

 

So if you haven't told them about all your 'cash jobs' and not supplying adequate expense records (I'm not accusing you, just supposing - as many do exactly this. Arthur Daley, anyone?), then they will redirect any questions, back to you, with the relevant section, complete with your signature, suitably highlighted!

[chris p bacon]

But I think you'll find that there is a little waiver, just above where you signed, that the income tax form so presented, is based upon the information that YOU provided to the accountants. So that includes any business income & expenses.

 

So if you haven't told them about all your 'cash jobs' and not supplying adequate expense records (I'm not accusing you, just supposing - as many do exactly this. Arthur Daley, anyone?), then they will redirect any questions, back to you, with the relevant section, complete with your signature, suitably highlighted!

 

You're dead right there'll be a get out clause.

 

For me, everything I sell has a transaction that's carried out by a solicitor (house sale) and there's never more than 2 in a year, the only other things are purchases which can easily be attributed to the drawings. Apart from trying to fiddle materials which quite frankly is just not worth it, I cannot see the point in taking them up on their  insurance.

[40F]

I don`t know about accountants some solicitors can be very elusive and then pick figures out of the air. One we are dealing at the moment never gets back when she says she will often two/three days later 

[hayfield]

You're dead right there'll be a get out clause.

 

For me, everything I sell has a transaction that's carried out by a solicitor (house sale) and there's never more than 2 in a year, the only other things are purchases which can easily be attributed to the drawings. Apart from trying to fiddle materials which quite frankly is just not worth it, I cannot see the point in taking them up on their  insurance.

Chris

 

There are get out clauses and get out clauses. The accounts are prepared using the info supplied by the customer, if the customer decides to withhold information how can it be the accountants fault

 

On the other hand, if the accountant makes an error in compiling the accounts, then it is their fault

 

I know of a builder who built his own house and included the invoices for the personal materials into his business account, the accountant informed him that his invoices exceeded his billing to customers, the builder requested his accountant to throw a few invoices away. True story