Submitting Clients Self Assessment

Submitting Clients Self Assessment

Didn't find your answer?

I have a new client that I am sceptical will actually pay his invoice. 

I carried out his self-assessment return in December and I am still waiting for his payment of my invoice. 

I chased him yesterday and made him fully aware again of my terms that I wouldn't be submitting his tax return (pressing the one button) until payment had been made. 

I then got the following response. 

  a painter won't walk into your house, quote u, get paid, walk away and start the job another day now would he!?

Any suggestion on how to deal with this? 

I basically just want to make sure that the invoice is paid and then end the relationship with the client. 

Replies (29)

Please login or register to join the discussion.

avatar
By andrew55
26th Jan 2016 12:30

Easy

You've already done the painting. He just needs to pay.

Thanks (2)
By cheekychappy
26th Jan 2016 12:32

He sounds like a charmer.

Respond as per above.

Thanks (1)
By Duggimon
26th Jan 2016 12:33

Stick to your terms

He agreed to your terms before you did the work, now is not the time for him to argue the toss. Tesco don't let you eat your dinner first, then pay for the food.

If you have no desire to keep him as a client I wouldn't submit his return until he pays, regardless of the impending deadline, provided you have his agreement to your terms in writing.

Thanks (2)
By Moonbeam
26th Jan 2016 12:36

Do absolutely nothing more

You have given a clear indication that the return won't be filed without a payment from him.

I presume you also told him this is how it would be when you first met.

Treat his response as being confirmation that he got your last email. He appears to want to unilaterally change your terms of business. It's as if he got to the checkout in Tesco's and told them he doesn't need to pay until he's eaten the merchandise.

Don't even think about him from now on and if he calls or emails, just restate your terms, and say you will not discuss anything at all now (even if it makes his TR late) until you get paid.

In future get everyone, even nice people to pay in advance.

Thanks (1)
Replying to Paul Crowley:
Red Leader
By Red Leader
26th Jan 2016 12:39

letter before action

Don't p1ss about, send a shot across his bows. I suspect it's the only language he understands.

Thanks (1)
avatar
By Pelican
26th Jan 2016 12:42

I have very few people that don't pay before the job is done.

He has just emailed me saying that I haven't helped him pay his tax bill as I don't have his User ID and password for government gateway (insert willing to live face) 

Any brilliant responses apart from the usual, you don't need the log in details to pay the bill would be great.

Thanks (1)
avatar
By Gone Sailing
26th Jan 2016 12:44

Scary

I find it a scary prospect to only take on clients on a 'pay in advance' or 'pay before I finish' basis.

Only 2 bad debts in 5 years.

Two testing ones currently.

Spotting them when they walk through the door?

Thanks (0)
Replying to Cant Add Up:
avatar
By Pelican
26th Jan 2016 12:57

I had a client 2 years ago that took me over £700 and I have not seen a penny of it.

 

Depends what your company is like but I run a very small company and it is my only source of income. 

Thanks (0)
By cheekychappy
26th Jan 2016 13:01

Why not take them to the small claims? That's what I would do.

Thanks (0)
Replying to Paul D Utherone:
avatar
By Gone Sailing
26th Jan 2016 13:15

Small Claims

cheekychappy wrote:

Why not take them to the small claims? That's what I would do.

I think it's often a fear that it won't end there - especially in smaller communities.

Mine were both around £700, but it's my time, not something I purchased to sell - so one learns and tries to be philosophical.

The opportunity cost is time spent on marketing or learning.

Thanks (2)
Image is of a pin up style woman in a red dress with some of her skirt caught in the filing cabinet. She looks surprised.
By Monsoon
26th Jan 2016 13:02

50/50

If a client isn't on a monthly fee I charge 50% on commencement (no money, no commencement) and 50% on completion (no money, no submitting to HMRC). No-one has ever had a problem with it.

 

The guy is a bit of a chancer by the sounds of it!

Thanks (1)
Replying to JD:
avatar
By Pelican
26th Jan 2016 13:10

That is not a bad idea. I think I will put that in practice as a starting point. 

Limited Company clients are on monthly standing orders. 

Most of my SA clients are due rebates so it's easy for me to claim my money that way. 

Thanks (1)
Tony s
By Tony S
26th Jan 2016 13:34

What about trust?

I also run a very small practice and cant afford to lose any fees to bad debts. However, I believe trust is crucial in our client relationships. I tend to trust clients unless they give me reason not to; you shouldn't assume everyone is going to try it on.

Apart from the ones that pay in installments I don't charge any of my clients in advance. I wouldn't dream of threatening not to submit their returns until they pay up (unless they have previous). We are professionals and my view is that an invoice shouldn't be raised until the job has been finished to the clients satisfaction and (depending on the job) in the clients eyes submitting their return is the job.

Thanks (5)
Replying to penelope pitstop:
paddle steamer
By DJKL
26th Jan 2016 14:44

We are professionals

Tony S wrote:

 We are professionals and my view is that an invoice shouldn't be raised until the job has been finished to the clients satisfaction and (depending on the job) in the clients eyes submitting their return is the job.

Could not agree more re the professional reference, I would not dream of refusing to submit work already completed over non payment.

When I first started in the 1980s very few clients of my then employers would even get an interim fee (back duties were about the only activity where we billed on an interim basis), we ran up the time and billed at the end.

These days I even carry disbursements and outlays and bill these once a year in arrears when I send my clients their fees. I only have one slow payer (very slow- multiple years) but I know why and I also know  that when the property development they are involved with eventually works I will be paid.

Now maybe because I do not need the practice income for living costs I am more relaxed, but even when in practice for myself in 1994, when it was my only income and my wife was on maternity leave just after the birth of our daughter, I followed the same approach, and for the subcontract work I then did for another firm I got paid when they got paid, the last fee was settled 18 months after I had returned to paid employment.

I think trust is everything with clients, I have had no client losses in eight years and I believe there are reasons for this- I trust them, they trust me, it is my personal service not an ever changing staff member and I always deliver when I say I will deliver.

 

Thanks (4)
RLI
By lionofludesch
26th Jan 2016 13:59

Painting

Tell him you're not a painter.

Seriously, the analogy is not relevant to the situation in hand.

It implies that you're quoting him and getting paid on the same day.  Not the case at all.

Thanks (1)
Euan's picture
By Euan MacLennan
26th Jan 2016 14:11

You can be sure of one thing

If you don't file his tax return and he gets a £100 penalty, he will never pay your bill.

As to paying his tax, just send him a payslip printed off from the HMRC website to send in the post.  It demonstrates your willingness to help and might just prompt him to pay your bill.

Thanks (1)
Chris M
By mr. mischief
26th Jan 2016 14:48

My approach and thoughts

Personally anyone can have £500 of "free accountancy" from me, I would never sue someone for a small amount it is just not worth the bother.

I have a "2 months free with Oaktree" deal.  As a result, nearly 80% of clients are on standing orders so it's just a case of chasing up the odd bounced one.  10% are "small beer".  That leaves 10% of clients who have fees in the range £700 to £2,000 but have opted not to go for standing orders.  They are in 2 camps:

1.  Camp 1 - a £1,000 bill is loose change.

2.  Camp 2 - slow pay no pay.

The by-product of the "2 months free" deal is that before doing any work for a Camp 2 client that person has already flagged up to me that he or she is slow pay or no pay.  So I will typically do a few bits and bobs - a VAT return or a few payrolls, then raise a bill for say £300 or £400 plus VAT as per my letter of engagement.

The slow pay no pay person now has the onus on him or her.  They would like not to pay, of course.  But if they do that then you are going to walk away.  (Typically they slow pay then I send my "yellow card" letter informing them I will resign within 21 days if they don't pay up.)

Over 90% of the time they pay.

The numbers from my accounts for the past 6 years:

Debtors days = 3

Lifetime bad debts = £818 which is about 0.2% of sales

In this particular case, NO WAY FILE THAT RETURN.  This is poker we are playing, you'll never see his money if you do that.  HMRC will throw more money into the pot if you do not file for him, because if he has not filed by 31 August then he will be facing £1,200 in fines not £100.

Tell him he is a lucky guy, if he was my client his bill would already be £250 plus VAT by now because I charge extra for deadline chasers.

 

 

 

 

 

Thanks (1)
avatar
By caitlinbarker
26th Jan 2016 15:46

I think like Moonbeam. Stop

I think like Moonbeam. Stop doing anything.

Thanks (0)
7om
By Tom 7000
26th Jan 2016 17:23

call him

say I need your payment, can I have your credit card no please.

I cant send your return in till you have paid and if its late

£100 fine

Sorry, company policy, what do you want to do?

Then next year payment in advance ;)

Thanks (0)
avatar
By morgani
26th Jan 2016 22:31

Don't file
Been there before with trusting people to pay later who did not. I now use these as examples when clients question it (the few who do). I simply tell them our terms are payment before submission as unfortunately a few who took advantage spoil it for everyone else as I cannot necessarily tell who will and who won't pay. I also add the caveat that I'm not saying you won't pay and trust you will but also trust you understand where I'm coming from. If cash flow is an issue we take credit cards.

Thankfully most are on monthly DD so this is not for many.

Thanks (0)
By ireallyshouldknowthisbut
27th Jan 2016 09:25

.

Stick to your guns. I would also tell him you are shutting up shop at 4pm on Friday, and if cleared funds are not in the bank its going to be late.  

Ie dont have him pay you on Sunday, you file late and then he comes after you for the late filing fee.

Other point: do you have his home number?  If you can by luck get his Mrs it can be an easy 'in'.

Thanks (0)
avatar
By thomas
27th Jan 2016 09:51

I would file, and then pursue non payment through small claims court.  I thought the Institutes took a dim view on non submission re lack of payment.  However, with new clients I take 50% when work commences and 50% when the client receives the return.

Thanks (0)
By ireallyshouldknowthisbut
27th Jan 2016 10:07

.

@thomas, after which you have no hold at all and its a lot of hassle and cost to get paid?

 I would much rather have the reputation for being a bit harsh about getting paid than a wimp.

I have only ever had one client complain about this, and they just dropped their accounts on my desk today expecting to get filed by Friday. As if that is going to happen.

Thanks (0)
avatar
By Pelican
27th Jan 2016 11:16

Thank you for all your replies. 

 

Since my reply of explaining my T&C's in the engagement letter and telling him exactly how to pay I haven't had a reply. 

 

 

Onto the next client who now expects me to pick up his paperwork from his house.

 

As my wife said to me last night, "get rid off the clients that give you stress with paying, you'll thank me in the long run."

Thanks (0)
Replying to Wanderer:
Image is of a pin up style woman in a red dress with some of her skirt caught in the filing cabinet. She looks surprised.
By Monsoon
27th Jan 2016 14:04

Wife is right

Pelican wrote:

As my wife said to me last night, "get rid off the clients that give you stress with paying, you'll thank me in the long run."

Wife is right. Wives usually are :)

Thanks (0)
RLI
By lionofludesch
27th Jan 2016 11:17

Surprised

I had a client in yesterday who was astonished that he was the last to bring his books in this year, as he brought them in especially early.

Mid January.

No - he wasn't codding !!

Thanks (0)
Replying to ireallyshouldknowthisbut:
RedFive
By RedFive
27th Jan 2016 13:27

a bit fishy

lionofludesch wrote:

No - he wasn't codding !!

 

Hope you slapped him in the face with your fish supper

;-)

 

 

Thanks (1)
avatar
By Whinger
27th Jan 2016 12:44

.

Well, if you don't file it, then you probably will never get paid. So, i would submit it as that is part of the agreement, and then chase him for the money.

Keep the professional service and the credit control separate.

If you file it, as long as he has approved it, imagine if you went to court, and the Judge says to the bloke "why didn't you pay?" he has nowhere to go if you filed it.

Even though you're in the right, it would not look good if he said "well he didn't file the return in time and I got fined". Even though it's in writing and you are in the right, I know from experience, the Judge is more likely to go on the side of "the job wasn't completed".

It would add to your case too, that you had in writing that you wouldn't file, but out of goodwill you did in fact file despite not being paid, all the pressure shifts to the ex-client.

Thanks (0)
avatar
By darrenwilliams
27th Jan 2016 14:17

As a professional and a better person and someone who trusts others,

I would on this case, just send in the tax return. It is not going to cost you anymore time/money. Think about that, as you have already done the work........

Then see if he pays, if he does not you could then disengage and take it as a life experience.

 

If you do not like people not paying you, then learn from it and ask for money up front in future.

 

Myself on the other hand, would just say that's life and move on, life is to short. I have been hit for plenty of bad debts over the years but still lived and made a good living. Just see it as part of running a business and trusting people (treat others as you would expect to be treated yourself. i(ie. I would not expect to pay up front myself)

 

Hope that helps.

Thanks (0)