Standing orders

Standing orders

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I would appreciate some wise words please.  I'm new to this.

Im sending out my new client's engagement letter and ToB. I'd like to include a standing order form.  How do I sell this. Its for sole trader tax return 2011/12. I'd like 'her' to pay 6 mthly installments for this return and then start on 12 mthly installments for 2012/13.  I understand this is standard practice now.

How do you sell this to the client?  I'd like to get across that Im providing a service which is not just one deliverable, but cant quite put it into words

Any ideas/ inspiration?

Thank you

Sheffield

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By Jimess
01st Nov 2011 17:28

Discuss methods of payment...

I always discuss methods of payment at the initial meeting and fully explain how the payment on account system works.  I explain that my POA customers are given preference over non POA customers when it comes to getting the jobs done and agree precisely what is covered by the monthly payment on account - for example I have some clients who pay for bookkeeping and payroll monthly, but pay their accounts fees by 50% at start of job and 50% prior to finalisation.  It is not an easy subject to put into a letter as a cold call, so I find a good chat about it first makes all the difference.  You could put it from the point of view that you want to help clients to meet their accountancy obligations and one of the ways of doing this without experiencing delays is to make payments on account.  It helps clients to spread the cost (by prepaying) over a period of time, which is always a useful thing in cash flow terms.  Remember the POA does not just help you get paid - it also helps the client to manage the fees payments so the client may well see it as a win/win situation anyway.

A word of caution - once you have agreed terms with the client always reiterate those terms in writing. Issue a letter setting out exactly what the payment on account covers and when any balancing payment will be calculated.   A couple of years ago I agreed a POA with a client to cover his company accounts.  I explained that at the level of POA he had chosen it would only cover the accounts prep and that he would need to pay further fees for payroll, corporation tax, personal tax etc.  When push came to shove he denied ever having the conversation and I am still trying to get the balance of fees from him. 

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By SteveOH
01st Nov 2011 19:39

I can do no better than to simply echo what Jimess has said

During the initial conversation I mention that my fees are paid by monthly standing order. As all my fees are agreed in advance, my clients know exactly how much they will be paying me during the following 12 months and what services they will be receiving.

The fee etc is detailed in the Letter of Engagement.

Thinking back, I think I have only had one prospect ask if he could pay upon completion of the work. I just explained how I operate and he said "that's fine". Most clients prefer monthly billing anyway.

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By skhan
01st Nov 2011 21:56

Engagement Letters

The ACCA Engagement letters CD is very old. Any new development on that front? 

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