Blogger
Share this content
0
24
4186

Clients confusing Annual Return with Annual Accounts

An area I need to change as a matter of urgency is clients confusion on Annual Return reminders from Companies House with annual accounts filing.

This happens often. I get an email/text/call  from clients saying I should call urgently and explain why their accounts have not been filed. They tend to be clients with newly incorporated companies. 

I would be grateful for pointers on:

1) Do you file AR for clients of do you leave this to clients? I leave this to clients, unless I am asked to file the return. 

2) How do you make sure clients are educated in this area? A template email? Or is it best just to file the return to avoid all the headache? 

3) Do you cover the AR filing fee +Admin fee  as part of your monthly fees? 

How can I improve on this area?  It is nothing major but from clients' perspective it is a huge deal.

Thanks  

Replies

Please login or register to join the discussion.

Surely you can just ring or email them ahead of the annual return deadline and explain to them that they will be receiving an reminder through the post but you are already on top of the work and will be in touch in due course?

Thanks (1)
22nd Feb 2013 09:52

It's no big deal

Get email reminders sent to you.

Fill the return in (usually it's just a case of checking that the information is correct and clicking OK).  Check it with the client.

Pay the £13 and ask the client for it.  I don't even bother raising a fee note at that point but that's up to you.

Thanks (1)
avatar
By Flash Gordon
22nd Feb 2013 09:54

Do it for them

I tend to handle it for them as a matter of course because it doesn't matter how many times you try to explain in words of one syllable there are always some who think that you've not filed their accounts. And as you can provide an email address so that Companies House email you a reminder instead of posting it you don't have the reminder turning up on their doorstep but in your inbox - result equals less confusion for them. All you need to do then is check with them that there have been no changes and then file it. Job done. Include it in the fees so no extra bill necessary. Happy feelings all round.

Thanks (1)
avatar
22nd Feb 2013 10:08

Give them a key dates sheet

If they tend to be new incorporations just give them a sheet of paper with key dates on it and who is responsible for the action.

As an example see below.  I have not included who is responsible for every point listed.

12 monthly payment dates to your accountant (you are responsible for this)

12 monthly PAYE payment dates (we will advise you of the amount, you are responsible for ensuring the payment is made)

P35 date to be replaced with RTI

P11d dates

VAT quarter ends

VAT submission and payment dates

Annual return

Pre year end tax planning meeting

Year end

Date accounts to be filed

Date CT to be paid

Date CT return(s) to be filed

Personal tax return

Dates you want them to do something eg personal tax return information 31 May-13.

 

If you organise the client you can also drop all or some of these dates into you work schedule and organise yourself.

It may not be the way that everybody works but I do it in year one for new clients so we both know what is happening and when.  After year one I just refer them back to the schedule.  

The schedule is also quite useful for reminding the client what they have agreed to do and what you have agreed to do and can be used to sell additional services.  eg We have not listed management accounts as you have not asked us to prepare them.  We have scheduled tax review on x, and for this to be effective could you provide figures that indicate current profits and a balance sheet to allow us to consider capital allowances and the director's loan account position.

Thanks (7)

Relax

Some people struggle with left and right or east and west. You can not educate them out of it.

The problem for us is the tone of the reminder letter from Companies House. It gives the impression that someone has messed up when they haven't.

Thanks (5)
avatar
By VLH
07th Mar 2013 15:21

Companies House Letter

andy.partridge is spot on - all that red gives the impression that something hasn't been done when in fact it is just the prompt to do it.

 

We used to absorb the cost into the accounts but as the cost of the Company Secretarial package (IRIS) has risen we are now charging £25 + VAT to do the annual return in addition to getting the client to pay the £13 filing fee.

Thanks (1)
avatar
By refs8
22nd Feb 2013 12:02

Just ask for the £13

We just ask for the £13 and process the return once paid - simple as that -  no payment no filed return. The nicer the client they might get a phone call. 98% of our clients are at our office as registered office. So is easy but time consuming task, as the practice has grown

Thanks (1)
avatar
22nd Feb 2013 12:44

An unnecessary pain

Why this information cannot be provided as an attachment to the annual accounts is beyond me.  I fail to understand why CH seems to rank this above the accounts in terms of importance (they move to strike off very quickly for not filing annual returns but can let accounts lapse for years). Doubtless the fact that there are fines for not filing the accounts has something to do with it.

 

 

Thanks (1)
22nd Feb 2013 14:33

Not quite true

Roland195 wrote:

Doubtless the fact that there are fines for not filing the accounts has something to do with it.

The penalties are for filing the accounts late, not for never filing them.  Yes - I know the directors could be prosecuted for a breach of their legal duty to prepare and file accounts, but I have never heard of it in practice.

Thanks (2)
avatar
By Old Greying Accountant
22nd Feb 2013 15:36

I think ...

Euan MacLennan wrote:

Roland195 wrote:

Doubtless the fact that there are fines for not filing the accounts has something to do with it.

The penalties are for filing the accounts late, not for never filing them.  Yes - I know the directors could be prosecuted for a breach of their legal duty to prepare and file accounts, but I have never heard of it in practice.

... Paul Scholes discovered if 2011 are late and you file 2012, there will be no fiine as 2012 were not late, and as the record is then deemed up to date they will not chase! He found this out as a client did this to avoid the one year they went over the audit threshold if i remember correctly?

Thanks (1)
22nd Feb 2013 14:45

Clients just panic

The way the AR reminder is written just makes my clients panic. 

They just fire me an email  asking why I have not filed the accounts. They think AR is annual accounts. 

It is a small matter that causes me the biggest headache. I will bring in a better system. 

Thanks (0)
avatar
22nd Feb 2013 15:25

Wording is bad

The wording of the letters is awful and always gets clients backs up.

That said we now have a procedure where we have all of the annual return dates in our database so that we are aware of any deadlines coming up. We also set every client up on ereminders so that we both get a copy of it. Each week one of the admin stuff checks to see which returns are ready to be completed and will forward the information to the client. It is part of our standard practice, if the client wants to do it themselves they can but they will still get a reminder sent from us. Incidentally we do the same for VAT return deadlines even though we don't always do the VAT for them.

We pay the £13 and recharge the client for it if they want us to file it for them. 

 

Having these processes helps to keep client care in place and communication which is really important.

Thanks (2)
avatar
By Old Greying Accountant
22nd Feb 2013 15:40

In the majority ...

... of cases I am registered office and I deal with the returns.

These are a nice earner, I get the £13 into my client account before I will file.

Thanks (0)
22nd Feb 2013 15:58

Why not charge an admin fee?

I charge £50+VAT this includes filing fee. 

Just to charge for filing fee would be a loss. 

Thanks (0)
avatar
22nd Feb 2013 21:47

Admin fee is reasonable

FirstTab wrote:

I charge £50+VAT this includes filing fee. 

Just to charge for filing fee would be a loss. 

Agreed, should definitely charge a nominal sum for your time unless its included in your annual fee quote.

Don't forget though, VAT would be only on the £37 service element, not the £13 disbursement.

Thanks (1)
23rd Feb 2013 11:39

Hmm - depends how the bill's worded.

Thanks (1)
avatar
By Old Greying Accountant
22nd Feb 2013 16:26

I do ...

... charge on top (plus filing fee, I send a bill for my fee and a disbursement note for the filing fee). What I charge depends on the client, my point was as refs8 said, no £13 in my client account, no return filed.

 

Thanks (1)
avatar
By Sarah P
23rd Feb 2013 22:17

It must take all of 60 seconds
to file an annual return.

The goodwill generated by handling it free of charge must outweigh any fee if you charge for it.

Thanks (1)
avatar
By Old Greying Accountant
24th Feb 2013 16:16

Do you ...
send it to the client for approval first?

Thanks (0)
avatar
By Sarah P
24th Feb 2013 17:10

I just...
ask for email confirmation that there have been no changes.

Thanks (1)
avatar
By Old Greying Accountant
25th Feb 2013 10:17

what about ...

... collecting the filing fee?

Personally I send the form to the client, get them to sign it and return it with the filing fee (whether by post or electronically).

Filing fee goes in my client acount and is used to clear the Companies House account at the end of the month, so some reconciliation needed of ins and outs too.

I am not an advocate of including the filing fee in your fee, it is a client liability and by issuing a disbursement note and keeping the money clearly identified in my client account gives a clear identifiable trail. It is not the amount, it is the princiapl involved, would you pay late filing fees for your client, CT liabilities etc?

I think it just best practice to keep practice money and client money completely separate, much easier to have a single system for all such items.

Then again, I don't charge for being registered office as such (prefering to ensure I see all statutory mailings in a timely manner), but view the Annual Return fee as covering the years work in dealing with mail etc that comes through me.

So, if you choose not to charge, that is fine, every practice will have its own business model that works for it. If you are doing them yourself as proprietor then may be do them for free, but if you employ staff who do them, including monitoring deadlines etc then you would need to charge.

I would say though,, it doesn't just take 60 seconds to deal with an annual returm properly, and it is also a chance to make sure the statutory books are written up fully, to review the accounts to make sure there are board minutes for necessary items such as large fixed asets purchases, dividends paid etc. 

Thanks (1)
avatar
26th Feb 2013 11:10

We send the annual return to clients and ask them to check it and return it with the filing fee. if they dont send a cheque we wont file it until they do.

Also we sign all our clients up to email reminders with our email address, that way they wont get any paper reminders sent to them

Thanks (1)
avatar
27th Feb 2013 10:34

AR

We invoice out for this service stating in the wording it is for the preparation and submission of their annual return.

We also have reminders set for all clients to make filing easier and advise new clients that unless they wish to, we automatically submit their AR's and then invoice them with a nominal fee on top of the filing fee and generally have no problems.

And as we are usually the registered office, any post comes to us.

Thanks (1)
avatar
07th Mar 2013 15:53

From the other side ....

Having always worked in industry and not in practice.

When I joined a previous employer I was surprised to receive a letter  from our Accountants asking me to check the AR and to confirm if there were any changes.

I thought that was very nice of them until they send me an invoice for £50 (this was 11 years ago) - I was actually paying them when it was me doing the checking ! (their fee was to cover them asking me to check the form and for them to post it to CH).

This seemed crazy to me, but when I spoke with the directors they were happy to continue and pay the charge.

Thanks (0)