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Can traditional practices provide £29 pm service

Can traditional practices provide £29 pm service

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As a traditional chareted accounts and chartered tax generalist practice and considering the litany of regulatory changes that have come at us. How can the generalist qualified firm provide a £29 per month service??? We couldn't open a file for this much so how are other firms servicing these clients considering the confetti of emails and constan quesions from clients that there are these days?

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By NH
06th Jul 2019 05:41

well....it depends what you are doing for your £29!

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By FirstTab
06th Jul 2019 07:48

FROM £29 pm?

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Replying to FirstTab:
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By Tickers
06th Jul 2019 11:55

FirstTab wrote:

FROM £29 pm?

Good point. So what exactly does £29 pm get you. I'm looking at websites quoting £29 pm with unlimited email and telephone support???
In my experience, clients on monthly retainers will use the support because it's there and they want to get their usage. A bit like using your audible credits each month, you don't see anything you're particularly interested in but the credits are there so you may as well use them. Then the litany of questions of what's tax deductible and what isn't flow in even though these topics are covered on your FAQ because it's easier for a client to pick up their smart phone and send you an email rather than look it up themselves.

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Replying to Tickers:
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By lionofludesch
11th Jul 2019 18:35

Tickers wrote:

FirstTab wrote:

FROM £29 pm?

Good point. So what exactly does £29 pm get you. I'm looking at websites quoting £29 pm with unlimited email and telephone support???
In my experience, clients on monthly retainers will use the support because it's there and they want to get their usage. A bit like using your audible credits each month, you don't see anything you're particularly interested in but the credits are there so you may as well use them. Then the litany of questions of what's tax deductible and what isn't flow in even though these topics are covered on your FAQ because it's easier for a client to pick up their smart phone and send you an email rather than look it up themselves.

I'd maybe do a tax return for £29 a month. Depends.

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By SXGuy
06th Jul 2019 08:12

No idea. I lost a book keeping job a few years ago because someone quoted £20 pm. Including travel to pick up the books! Must be running a loss on that one. Would have cost me £10 just to get there.

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By SWAccountant
06th Jul 2019 09:38

£350 p/a for what? A tax return based on bookkeeping you've done yourself in the cloud that the accountant doesn't really check in anyway? I can see that happening, with a small profit.

If you drop the quality, you can drop the price.

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By Tickers
06th Jul 2019 11:50

SWAccountant wrote:

£350 p/a for what? A tax return based on bookkeeping you've done yourself in the cloud that the accountant doesn't really check in anyway? I can see that happening, with a small profit.

If you drop the quality, you can drop the price.

We've heard that many times also "I've done everything myself, all you need to do is just check it and file my income tax return"
I'd hazard a guess that of all the clients we've come across where they prepared their own accounts/bookkeeping, in the vast majority of cases it would have been easier to prepare the accounts from scratch.

If you're filing a return for a client you have a duty of care (at a minimum) to check that the balances you've been presented with are somewhat reasonable.

I'm just curious as to how other service providers hiring qualified accountants can do this for £29 per month. They must be churning through the work.

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By SWAccountant
08th Jul 2019 09:55

Indeed. But if you don't care about checking what they've done, you can just churn it out.

I've seen loads of files for clients we've taken over where the work is terrible, yet they call them selves chartered accountants and they've charged a decent fee.

There will always be people in any field prepared to break rules to make money.

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By bernard michael
06th Jul 2019 09:58

Why £29 per month ??

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Replying to bernard michael:
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By Tickers
06th Jul 2019 21:37

bernard michael wrote:

Why £29 per month ??

"Some people look at things and ask why, I look at things and ask why not"

A nod to your Irish heritage there Bernard.

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By free-rider
06th Jul 2019 12:51

I actually have a few personal tax returns where I charge £30 pm in fees.

These are however more of an exception than the norm - very small and straightforward sole traders with a dozen of sales invoices per annum and 10-20 expense receipts. Once AML and signing up are completed they require not more than 2-3 hours per year of my time so still make profit out of £360 pa fee.

But these are legacy clients which I have looked after from the very start of setting up the practice and these fees are not available for new clients

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By Tickers
06th Jul 2019 14:15

free-rider wrote:

I actually have a few personal tax returns where I charge £30 pm in fees.

These are however more of an exception than the norm - very small and straightforward sole traders with a dozen of sales invoices per annum and 10-20 expense receipts. Once AML and signing up are completed they require not more than 2-3 hours per year of my time so still make profit out of £360 pa fee.

But these are legacy clients which I have looked after from the very start of setting up the practice and these fees are not available for new clients

That's fair enough but the monthly unlimited email and telephone support for £29 pm?

There's an expectation in the market, even for well paying clients, that by paying an accountant a monthly fee that this is a replacement for an in-house accountant. We've tailored our engagement letters to such a level of detail that we point out what exactly the service is but also what the service is not.

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By free-rider
06th Jul 2019 23:01

This pricing only works for a very few clients whose tax affairs are very simple so they require little to none support through the year.

My LoE are clear that the majority of retainer contracts cover "fair" level of support and the client will need to pay for add hoc reports/support/hand holding. At the end of the day, O like seeing clients succeed but I also like being paid for work I do.

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Replying to Tickers:
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By towat
09th Jul 2019 10:37

Tickers wrote:

free-rider wrote:

I actually have a few personal tax returns where I charge £30 pm in fees.

These are however more of an exception than the norm - very small and straightforward sole traders with a dozen of sales invoices per annum and 10-20 expense receipts. Once AML and signing up are completed they require not more than 2-3 hours per year of my time so still make profit out of £360 pa fee.

But these are legacy clients which I have looked after from the very start of setting up the practice and these fees are not available for new clients

That's fair enough but the monthly unlimited email and telephone support for £29 pm?

There's an expectation in the market, even for well paying clients, that by paying an accountant a monthly fee that this is a replacement for an in-house accountant. We've tailored our engagement letters to such a level of detail that we point out what exactly the service is but also what the service is not.

The thing about "unlimited support" is that very few clients use it, even less that the 20%-80% Pareto rule would imply, especially with the Subbie type clients who I expect this level of fee is aimed at, and if you do get a problem client that "abuses" the system you either sack him or increase the fees in year 2.

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By atleastisoundknowledgable...
06th Jul 2019 15:40

I keep getting offered a FT qualified accountant for £600pcm ... from various outsourcing companies in India / Philippines etc.

I could probably charge £29pcm if I outsourced everything to the Philippines!

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Replying to atleastisoundknowledgable...:
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By Tickers
06th Jul 2019 19:18

atleastisoundknowledgable... wrote:

I keep getting offered a FT qualified accountant for £600pcm ... from various outsourcing companies in India / Philippines etc.

I could probably charge £29pcm if I outsourced everything to the Philippines!

Couldn't we all but I don't think clients would appreciate it.

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By bernard michael
07th Jul 2019 09:51

Are you sure it's not 29 PINTS per month being the "man in the pub" charge

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By atleastisoundknowledgable...
07th Jul 2019 16:47

Probably get similar levels of advice

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By ireallyshouldknowthisbut
08th Jul 2019 10:07

We do tax returns for £350+VAT.

not much on 'em however! Say 1 or 2 let properties.

or perhaps a small sole trader with all the records nicely in excel which we don't vouch to anything.

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Replying to ireallyshouldknowthisbut:
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By NH
08th Jul 2019 10:18

Our lowest price is now £18+VAT per month - typical example is a small sole trader or BTL landlord with super neat records in excel with hardly anything to check. Reasons why we can do it so cheap?
1. Monthly payment - no time wasted chasing money
2. Client records - neat, well presented
3. Client knowledge - we get to know the client pretty well and get a good feel as to how reliable they are
4. Our own low overheads - we work mostly from home
5. My own 20 years experience with similar from staff - makes it quick and easy to spot potential issues
And yes that includes any support required during the year, but we find it is rare to hear from a client more than once a year, perhaps the odd mortgage reference or tax question.

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Replying to NH:
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By Tickers
10th Jul 2019 20:19

NH wrote:

Our lowest price is now £18+VAT per month - typical example is a small sole trader or BTL landlord with super neat records in excel with hardly anything to check. Reasons why we can do it so cheap?
1. Monthly payment - no time wasted chasing money
2. Client records - neat, well presented
3. Client knowledge - we get to know the client pretty well and get a good feel as to how reliable they are
4. Our own low overheads - we work mostly from home
5. My own 20 years experience with similar from staff - makes it quick and easy to spot potential issues
And yes that includes any support required during the year, but we find it is rare to hear from a client more than once a year, perhaps the odd mortgage reference or tax question.

Sorry but I couldn't get out of bed for £18 pm. That's approx. 185 clients on £18 pm to pay a salary of £40k per year!!!

Are you a member of a professional body btw?

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By NH
11th Jul 2019 06:51

why limit yourself to 185 clients?

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By Yalnif
12th Jul 2019 12:56

Its not a bad return, if say these small Returns take 2/3 hours each, then that is only 15 weeks work for a £40k salary. Feet up and enjoy the 37 weeks of holiday

But life is never as simple as that :)

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Replying to ireallyshouldknowthisbut:
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By atleastisoundknowledgable...
10th Jul 2019 21:47

ireallyshouldknowthisbut wrote:

We do tax returns for £350+VAT.

not much on 'em however! Say 1 or 2 let properties.

or perhaps a small sole trader with all the records nicely in excel which we don't vouch to anything.

I need to increase my prices. We do s/e tax returns for £200 - £250.

‘I need to increase my prices.’ Seems to be a common comment on here for me!

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By Glenn Martin
09th Jul 2019 11:52

Why don't you subcontract your work to them and have an easy life.

There is a firm advertising on Facebook where they give you an instant quote.

Was very cheap, I was really shocked at how cheap.

£145 pm for £1m turnover, 100 invoices pm and includes Xero and RB.

I imagine they either get you on board then sting you with loads of extras or the work is of a very poor standard and is processed assuming the Xero is 100% accurate when it comes in.

£29 must surely be for a tax return only.

The cheapest I have seen for a company is £45 pm in North East.

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Replying to Glennzy:
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By NH
09th Jul 2019 12:22

Our cheapest for a company is £35+VAT for a very simple company, same reasons apply as my previous post.

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By indomitable
09th Jul 2019 12:48

There has been a 'race to the bottom' for many years now in the small client market. I totally agree with the comments above and I wouldn't do this with unlimited support and constant emails from the client. But to prepare a very simple self-assessment return every year with excellent records from the client and it wasn't going to take you longer than a couple of hours in total yes possibly.
The headline price is just a marketing ploy in many cases

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By Tom 7000
09th Jul 2019 12:51

sole trader subbie. 12 invoices with CIS and no expenses....and just claim the 1k trading allowance...

Yep that works...

I will have it

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By pauljohnston
10th Jul 2019 10:21

Hi Guys . Just seen a quote from an "Accountant" £12 per hour.

Since our staff earn more that than this and the minimum wage is £7+ not sure which sweat shop is doing the work.

Best wishes

Paul

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By Glenn Martin
10th Jul 2019 13:56

Can I have his number he can do my work for me and I will finish for the day.

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By atleastisoundknowledgable...
11th Jul 2019 18:31

Just been speaking to a potential lead who is a contractor ltd.

He’s not going with me, because my £95pcm is extortionate compared to the £30pcm quote he’s had from a firm who says “there’ll be little difference from the work to do a sole trader”.

No comment.

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Replying to atleastisoundknowledgable...:
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By NH
12th Jul 2019 05:28

Depends whats involved, generally £95 is expensive, £30 is too low but again depends on whats involved - non vat reg contractor with hardly any transactions and no payroll might just about be able to do it for that.

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Replying to NH:
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By atleastisoundknowledgable...
12th Jul 2019 08:00

NH wrote:

Depends whats involved, generally £95 is expensive, £30 is too low but again depends on whats involved - non vat reg contractor with hardly any transactions and no payroll might just about be able to do it for that.

But who’s advising contractors not to have a payroll scheme (*conditions apply - obvs I mean in general).

We do £95 VAT client records on Excel, £115 VAT, I provide apps & we do the bkpg. £20 deduction on each if not VAT reg.

Am I too expensive? What would you/others charge for the same?

Thanks

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Replying to atleastisoundknowledgable...:
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By NH
12th Jul 2019 08:30

We have had a £65-£85 price range for VAT reg contractors for a while now, we drop to £45-£55 for non VAT.
The difference in price for us depends on what software they want, if they are with RBS/natwest we usually go with Freeagent as its free, but Xero will push them up to the higher end.
Another way we have been able to keep costs low for us is using software not excel, to get a daily bank feed makes such a difference, there are always times in the week, month or year when there is less work to do, and with having the feeds we can catch up as and when we want, most of my work is done between 6am and 10am for example.

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Replying to NH:
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By atleastisoundknowledgable...
12th Jul 2019 22:14

Thanks. Appreciated.

I think that I need to revisit my pricing.

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