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Fees for due care and attention

Fees for due care and attention

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When working out a final fee to charge a client do colleagues record a provision for due care and attention throughout the tax year or do colleagues assimilate this time, which quite frankly is outside the charge for accounts.  As colleagues know some clients contact far more than others and some clients have more complicated businesses. 

Most times I assimilate and do not charge extras for extra time spent but sometimes I recognise that this is costing me when adding up for all clients.  Especially when you consider the cost and increasing cost of software.  I suppose one way is to have a higher hourly rate?

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By Mr_awol
21st May 2019 13:34

I wouldn't charge for 'due care and attention'. Not because I don't pay it to my clients, but because when they undoubtedly asked me what it was for, I wouldn't know.

If they want a mortgage ref (infrequently) and it's easy, I do it for free. If the lender (or more likely some idiot broker) wants me to go above and beyond, I charge.

I don't charge for accs reminders, calculating their tax (outside of the TR fee) or reducing POAs but do charge for advice on proposed transactions (company cars etc) or tax planning.

So, perhaps colleague could enlighten this colleague as to what colleague thinks colleagues might or might not be charging for as part of the 'due care and attention' package?

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Stepurhan
By stepurhan
21st May 2019 13:37

Not had hourly rates for a few years now, only fixed fees. A higher hourly rate might be needed for you.

But I think clients expect to be able to ask a few questions during the year without an extra bill. The odd free query demonstrates a willingness to support them that aids client retention. Billing them at the drop of a hat has the opposite effect.

The flip side is that if a query requires significant extra work, then you agree a bill before starting. What constitutes significant extra work will be a matter of judgement. In my opinion it should be at least an hour on that one query.

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By andy.partridge
21st May 2019 13:45

I think every client might reasonably expect due care and attention in everything you do for them.

I agree that some clients are higher maintenance. So long as you put some parameters in your letter of engagement there shouldn't be a problem in charging clients that fall into that category.

The trick is to communicate and manage expectations. Nobody in any walk of life enjoys receiving a surprise bill and you can expect resistance if you try to slip one through.

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Bee
By May bee
28th May 2019 10:02

When I quote for new business I always factor in a little extra time for the inevitable 'extra matters' that arise. I think clients hate being charged for the quick phone calls for "is there VAT on stamps" or whatever. Clients tend to be reasonably consistent with how much of this extra care they want/need, so I consider this when upping the fees for future years if they turn out to be the type that calls every month for 20 mins rather than every 6 months for 20 mins.

I do charge separately, similarly to Awol though, for things that are one-off. Wherever I can, I tell people upfront that there'll be an extra charge but sadly you can't always do this.

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Morph
By kevinringer
28th May 2019 13:19

I find any individual client will usually contact me about the same number of times throughout the year so I factor it into their annual bill. I only make a separate charge for something significant that is additional to the annual tasks.

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Morph
By kevinringer
28th May 2019 13:21

I don't charge anything for 'due care an attention' because I hope it applies to everything I do. I know of a local firm of solicitors that charged an additional 50% for 'due care and attention'. It went down a treat.

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Replying to kevinringer:
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By cormocountry
28th May 2019 14:45

Phrased like that, it makes one wonder if there IS a 2-level standard to which work is carried out by such 'professionals'..!!?? (.. In my line of business, we frequently encounter members of 2 generations that have the attitude that they should be able to cut corners, or get paid full wage for half-done jobs; as a result, there are some who won't work for us because they know they won't get away with it as they might or will elsewhere..!

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Replying to kevinringer:
ALISK
By atleastisoundknowledgable...
03rd Jun 2019 16:47

kevinringer wrote:

I don't charge anything for 'due care an attention' because I hope it applies to everything I do. I know of a local firm of solicitors that charged an additional 50% for 'due care and attention'. It went down a treat.

A top-4 form that audits one of my clients charged them for “Research into the affects of moving to FRS102s1A and disclosure requirements for financial statements’.

I told them not to pay it. I think it was about £3k from memory, total fee was c£40k

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