Clients!

Clients!

Didn't find your answer?

Whilst mopping up the stragglers, I checked on line for a client I hadn't heard from - he submitted his own 2008 tax return on Friday 30.1.09. Not too bad a client - but he had ignored the use of home claim we made the previous year and (obviously?) the capital allowances pool we can claim against. These, along with a couple of other areas, would save the client tax - it would easily pay my fee and some more besides. I mention my fee as I suspect the reason he filed his own return was to save my fees.

My question is: what would you do? Tell him to go, tell him to go and let him know the extra he could have made, offer to 'sell him the saving' or (as I started doing) simply ask him whether he intends to submit 2009 himself?

Normally when clients do this, it's final, but I'm not sure with this one!

Any suggestions welcome.

Richard .

Replies (16)

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By P J BROWNE
06th Feb 2009 17:32

Richard's client
Richard,
Like most professionals, you are probably very good at the core competencies of your profession, but are uncomfortable with the essential part of any business - selling. Accountants in particular are notoriously difficult to sell to, primarily because they only see the cost of something rather than the value. This scepticism then often translates to when they themselves need to be the sales people. They either ignore it or do it very badly. Effective selling does not seek a quick
one - off sale of a product or service, rather a long term business relationship that sustains and grows a revenue stream for the seller and a positive value service for the customer/client.
Please feel free to contact me if you require help on this. In the meanwhile it is important for Richard to retain this person as a client by acknowledging an understanding of why the client would have thought that he was saving money by doing the Tax Return himself; explaining to the client the constant changes in tax legislation which requires professional focus on in order to minimise tax liabilties and re-selling the value of his services based on what he has saved the client in the past- net of his fees. If the client still wishes to do his own returns, then wish him genuine good luck - and keep the door open for him to return. There are a lot more areas of potential revenue from any client than just tax returns. Keep the client!!

Good luck!

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By geoffemtacs
06th Feb 2009 08:08

First do no harm
Do you bother telling the Revenue that you aren't acting any more when you cease to act? Not worth the effort of a letter for us. If a client goes elsewhere then it's up to the new agent to supplant our 64-8. Otherwise we just let things go. But if you did simply want to remove a client from your Revenue-based lists, do it online and in collaboration with other removals. Then it is almost a passive move rather than an active one - it's more house-keeping than deliberate surgery.

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By User deleted
06th Feb 2009 01:31

Not dropping him in it
Thats part of my dilemma, Dave. Thinking on what Graeme said, he's likely to be under enquiry anyway and my resignation may just add to that possibility.

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By User deleted
04th Feb 2009 15:39

Sales book crossing over the year end
Just thought I'd share the following : the same thing happened to me this year and I too was surprised at being able to view the Standard Accounts Information.

I had to write to the client immediately pointing out that he should include the sales included in a duplicate book I had held on to previously as it crossed over into the March 08 year, and he'd only come in, as usual, in the January.

I have no way of knowing how he gleaned his (reduced) sales but most of the expenses looked odd and there were no capital allowances. It seems to me that when/if my resignation letter goes to the Revenue, they may take quite an interest in him. That would be a pity as his wife has been quite ill.

He was very behind with his tax bill and I just wondered if anyone has any comments.

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By Dave Paveley
04th Feb 2009 17:31

Well Don..

I guess that depends what you put in your letter to HMRC.

I put nothing more than "We no longer act, please update your records accordingly".

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By User deleted
04th Feb 2009 14:52

And if it's the other way round?
I have the reverse situation. As usual a couple of "no shows" so I checked the record, and found that one of them had filed a return. I too was surprised to find that I could look at the figures, and without going into detail it seems to me that the capital allowance claim was clearly wrong - I'm guessing the purchase of a new vehicle written off 100%, just from the figure - £7,995.

Irrespective of any arguments about confidentiality and Human Rights etc (which I don't believe have been breached) where does that leave us? I'm sure that the ex client won't want to know. I'm not particularly disposed to tell him (after all he didn't have the courtesy to let me know that he didn't want us to to his return). And I don't think that there are any money laundering issues because I'm sure that the ex client believes that he has done things properly and has no intention of paying the wrong amount of tax.

So I'm not planning on doing anything. I wouldn't take anybody like that back as a client anyway. Does anybody else see it differently?

On the OPs query, I wouldn't tell his former client either simply because he didn't say that he was going to do it himself. That won't have been a spur of the moment decision, because it takes time to apply for and get the HMRC code to file online.

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By martinbsmith
04th Feb 2009 14:06

Maybe too embarrassed to call you...?
Given that the client filed on 30 Jan, it may well have been a last moment decision. Maybe he was simply too embarrassed to call you, having ignored your earlier requests for "the usual info".

Or perhaps he feared a surcharge for being a straggler.

Yes - a friendly phone call seems the simplest way forward, but I wouldn't mention possible tax savings until I knew his reason(s) for diy.


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By Richardrussell
03rd Feb 2009 14:16

I couldn't help myself!
I had no idea that he would submit his own return. I had simply gone in to make sure that a return was definitely required before I wrote to him.

When this has happened before (it doesn't happen often, I might add!), I've usually received the notice summarising the tax calculation. I don't know if I'll get that this time.

I do agree with the earlier comment about disengagement - it would have been nice if he'd told me he was going to do that. Also, I do explain the purpose of a 64-8 to each client, so if he didn't want me to access his affairs, he should have told the Revenue that.

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By AnonymousUser
03rd Feb 2009 14:01

I use a local garage to service my car but .....
sometimes I do a bit of work myself on it and have had the MOT done elsewhere if they have a special offer on. So far, my regular garage have not questioned me on this (although they may have posted it on the Vauxhall forum!). Just because your client did it himself this year doesn't mean he won't be back next time. If he does you can raise the issue of the errors then.

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By User deleted
03rd Feb 2009 13:16

I agree, Nicholas
What does the letter of engagement say? Mine (which is based on a standard template) says that the client agrees that I may contact any third party to obtain information that I consider appropriate to deal with his affairs. Even though the client may have submitted his own return, unless he has terminated the engagement, I would remain liable to perform the duties set out in the engagement letter. Those duties may include the checking of liabilities, advising on payment amounts, dates etc - in which case I would consider viewing the client's data online quite acceptable. If he did not want me to do so he should (a) terminate the engagement in writing and (b) inform HMRC that I am no longer authorised to act on his behalf.

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By carnmores
03rd Feb 2009 13:09

Surely not Simon
even if you have an agent it does not mean that you cannot contract on your own behalf nor does it mean that the agent is by right dismissed. until the agent authority is withdrawn it should stand - and as for the possible breach of human rights et al well...............

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By pawncob
03rd Feb 2009 12:58

Pete T has opened the can
If you try to amend the return you can view the figures already submitted.
This must raise all sorts of issues.
The agent is authorised to submit the return (ongoing authority?) but has not done so.
He certainly can't amend the return without the client's specific permission, but has he breached his client's confidentiality by viewing the figures? I think he has, and certainly contravenes the Human Rights Act and possibly the Taxes Act as well.

What will the client do if he's informed of the position?

Certainly he won't wish to use that agent again, and he may consult his solicitor.

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By David2e
03rd Feb 2009 11:25

I'd not assume
You say he's not too bad a client - which must be quite good!

Really I wouldn't assume he is not using your services in future, unless you don't want to keep him as a client... it's just an easy way to send him elsewhere.

If your relationship is still good, and you do think the only reason he did it himself is to try to save - which is a fair thing for someone to do anyway - then I would mention to him that although your service would be £x, the additional tax reduction would have been £y by using you. Then ask if he would like to discuss this further, or if he feels he would like to continue to submit for himself.

Don't be too quick to get rid of a client!

Do you provide other services for him too?

David Toohey
The Accountants Circle

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By User deleted
03rd Feb 2009 11:21

Thanks so far
For Pete - I just went into his record and all his entries were there. I must admit I was surprised too.

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By User deleted
03rd Feb 2009 11:03

How can you tell what he filed?
If I go on to online services I can only tell if a tax return was filed or not and when it was filed not the amounts included on the return.

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By User deleted
03rd Feb 2009 10:38

It's happened to me a couple of times
The client always thinks he knows best!!!

I would just write to him and say that you assume that he will completing his own Tax Return in the future - and, by the way, did he realise that he had paid £xxx too much tax by not claiming such and such.

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