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Thought I had seen it all!

Existing client ask you to complete his accounts and tax return then submits himself to avoid paying

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After 40 years in practice I thought that clients couldnt stoop any lower.  Existing CIS subcontractor client asks us to complete his accounts and tax return.  Completed within two days, send off with bill asking him to confirm ok etc.  Today I receive 2 self assessment tax calculations from the inspector, an original and subsequent amended one.  

Strange I thought as I havent submitted anything yet.  Check our fees still outstanding.  Nothing received from the client.

He has logged into his own gateway and submitted my numbers originally, then decided he had forgotten SEISS grant. Went into the gateway, increased his expenses claim and declared his SEISS.

Any my fees remain outstanding!

I am fuming that clients thesedays can stoop so low.

Anyone have any ideas on how to stop this would be appreciated?

 

 

 

Replies (38)

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By MCV71
13th May 2022 10:06

Can you see on the submitted return if it shows your agent details on the Return?

If so, is there a case to contact HMRC and say the tax return submitted was not in line with the accounts prepared?

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By Louisemunro320
13th May 2022 10:22

No he's left that section blank

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By David Ex
13th May 2022 10:37

Have you contacted the client?

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Replying to David Ex:
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By Louisemunro320
13th May 2022 10:52

Yes ignoring phonecalls and emails. Been to his house as its only around the corner and bless his mum didnt know anything

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Replying to Louisemunro320:
By ireallyshouldknowthisbut
13th May 2022 11:14

Louisemunro320 wrote:

Yes ignoring phonecalls and emails. Been to his house as its only around the corner and bless his mum didnt know anything

Ah, perfect. Go in hard on the mum. Embarrass the pants off the lad who probably thought he was being clever. Put another neighbour up to a "I heard your lad miffed the accountant and didn't pay his bills, he had better watch out they will put HMRC onto you" type stuff. Could run and run. You could have a lot of fun with this.

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Replying to ireallyshouldknowthisbut:
RLI
By lionofludesch
13th May 2022 14:35

ireallyshouldknowthisbut wrote:

Louisemunro320 wrote:

Yes ignoring phonecalls and emails. Been to his house as its only around the corner and bless his mum didnt know anything

Ah, perfect. Go in hard on the mum. Embarrass the pants off the lad who probably thought he was being clever. Put another neighbour up to a "I heard your lad miffed the accountant and didn't pay his bills, he had better watch out they will put HMRC onto you" type stuff. Could run and run. You could have a lot of fun with this.

There seems to be no end of folk willing to publicly embarrass themselves - Vlad Putin, Rebekah Vardy, now this young fella-me-lad.

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RLI
By lionofludesch
13th May 2022 10:47

Disengage and send a notice of intent to sue for your fee.

I'd consider amending his return back to the proper figures but probably wouldn't do it. In the old days, when we had local offices, I'd've just mentioned the outrage on the phone to the Inspector.

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Replying to lionofludesch:
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By Louisemunro320
13th May 2022 10:56

The good old days when you could actually speak with an inspector at the local office. No wonder they are losing so much tax - nobody cares anymore. So dis enchanted with accountancy these days why do we bother

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Replying to Louisemunro320:
RLI
By lionofludesch
13th May 2022 11:12

Louisemunro320 wrote:

The good old days when you could actually speak with an inspector at the local office. No wonder they are losing so much tax - nobody cares anymore. So dis enchanted with accountancy these days why do we bother

HMRC are getting exactly what they asked for - taxpayers submitting their own accounts. The snag is, it cuts out the oversight of the professional intermediary.

Meanwhile - news today that the Government wants to cut nearly 100,000 more jobs, thereby further removing the "service" part of the civil service.

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Replying to lionofludesch:
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By David Ex
13th May 2022 11:18

lionofludesch wrote:

Meanwhile - news today that the Government wants to cut nearly 100,000 more jobs, thereby further removing the "service" part of the civil service.

The “civil” part went some years ago.

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Replying to David Ex:
By ireallyshouldknowthisbut
13th May 2022 12:21

re the 100k jobs, the crushing irony of course is a big slice of these have been caused by Brexit and the huge increase in paperwork this brings with it.

Boris and his gang wont of course acknowledge the huge costs of Brexit.

This seems to be just another "dead cat" to distract from the news they are ripping up (again) the NI protocol the same government agreed, which goes back to not understanding that you need a border somewhere. Either on the mainland (impractical and divisive, and breaches the Good Friday agreement) or in the Irish sea (essentially cuts NI off from the rUK). Two very bad options all round.

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Replying to ireallyshouldknowthisbut:
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By Rgab1947
17th May 2022 11:48

Ah no. When will all ills in the world finally not be blamed on Brexit. Let it rest please! We have moved on Covid and the war in Ukraine are my worries now.

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Replying to Rgab1947:
paddle steamer
By DJKL
17th May 2022 16:45

You may have moved on, I am still smarting from having my retirement planning rent asunder by the semi literate morons (financially) that are our elected politicians within the current Conservative Party- they had one USP, economic competence, having thrown that away they can , as far as I am concerned, wither to nothing once their red wall backfires and their original supporters refuse to return to their sheep fold.

Bah

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Flag of the Soviet Union
By thevaliant
13th May 2022 11:02

Do what Lionofludsch says but many many years ago:

We had a limited company client. Prepared draft accounts for discussion. Sent them to client. Never heard from him again (And never got paid - partner doesn't do legal action). However, a month after the filing deadline he took our set, lightly photocopied them (to remove the watermark) then dark photocopied them and submitted those to Companies House.

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A Putey FACA
By Arthur Putey
13th May 2022 11:07

If he also does non CIS work get your mates to waste his time quoting for work. Or if he has a van let the tyres down (but don't let his mum see you).

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By tracyannw
13th May 2022 11:08

I have suffered with this same issue in the past so moved to collecting fees during the tax year to which the work relates. Then come the year end when i am completing the accounts all fees are already settled.

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the sea otter
By memyself-eye
13th May 2022 11:12

write to him (or his mum) demanding your fee is paid within seven days - when it isn't start a small claims case. Once his mum gets bailiffs at her door, her son will be roundly spanked and sent to bed with no milk.
Oh, and send the usual MLR report which will be acted upon immediately, maybe.

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By Jane Wanless
13th May 2022 11:45

Once sent a paper copy of the return to a client to approve for online submission. Client submitted it themselves & refused to pay the fee. Happily, it was after the paper submission deadline so he got a late filing penalty.

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By Paul D Utherone
13th May 2022 12:17

If he has increased his expenses to cover the grant, do you maybe have scope to file an MLR? Not that anything will likely be done with it of course

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By SXGuy
13th May 2022 14:32

It's stopped by not working on credit.

Half deposit payment up front, half on Completion.

Balance is paid once client in person signs off the accounts, copy of the tax return given only after payment, only tax calculation summary given beforehanf.

Lesson learned a long time ago. Yes I admit there are some where I will bill afterwards but that is after a few years of payments received on time and I know the client.

I would never bill after the work is done with a new client. I'm not sure if your professional body allows it, but that's the only way I see you don't get stung.

A long time ago we had a client who would usually have a refund each year, we would take our fee from the refund and pass on the balance. Until one year when he went dark, after contacting hmrc we were told that we had been removed as agent and the details to issue the refund to had been changed.

Yes he decided to intercept us after submission, take the money and run. The worst part was he was a husband of a family friend. You can imagine how his wife felt.

Never again.

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Replying to SXGuy:
Flag of the Soviet Union
By thevaliant
13th May 2022 17:08

Genuine question:

Did you obtain payment (eventually)?
What did the wife of client say (if anything)?

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Replying to thevaliant:
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By SXGuy
13th May 2022 20:01

Never did receive the money no. It was a small fee so wasn't worth the hassle of recovery.

But we did find out from his wife that he openly admitted to it when she pulled him up on it.

To be honest, they ended up getting divorced in the end so I reckon she had a pretty good idea what he was like already.

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By JCresswellTax
13th May 2022 14:59

Does it really matter what he has done?

You have done the work and sent the return for approval - the only thing you haven't done is press submit.

Your fee is still due and payable, so just pursue collection of it in the normal way.

Thanks (4)
Replying to JCresswellTax:
Flag of the Soviet Union
By thevaliant
13th May 2022 17:10

There are huge numbers of people in this profession who simply don't bother with legal action.

All three firms I worked for never did it (and my current). They would chase, withhold work/submissions etc, but when push came to shove they'd just write it off (or hope to get the friendly liquidator appointed who'd usually see them good).

But Money Claim Online? They'd never go there........

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By Hugo Fair
13th May 2022 16:11

"Anyone have any ideas on how to stop this would be appreciated?"
SXGuy gives the obvious answer (which I presume others have simply been too polite to state) ... after all it's how almost every business operates if 'job' is to be performed over a period of time (just ask builders, software developers, & many others). Sad but true.

Getting paid now for this particular job is another matter ... as per the varied answers above. You're entitled to be paid (assuming you have some sort of contract/LoE), but whether to expend the effort in chasing it is your call (with/without any of the 'fun' suggestions)!

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Lone Wolf
By Lone_Wolf
13th May 2022 16:14

Disengage, MLR and pass to debt collection agency. Don't waste your energy on it.

As satisfying as it may be to get one over this eejit, where do you stand in terms of disclosing things to his mother?

Could that land you in some hot water as well if the client was so inclined?

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By Crouchy
14th May 2022 11:26

Just had a similar situation :(

a client with an outstanding 2021 tax return and accounts. The client brought the records in after the filing deadline and we've done a considerable amount of work to get the accounts turned around to draft stage and were just waiting for replies to queries to finish them off.

the client hasn't replied to the queries, HMRC had issued a late filing penalty in April (which he was always getting) and we've heard nothing further since despite numerous chasing emails

I have just checked his account with HMRC and a return has been filed

client now advises he has a friend helping him to get the return in and avoid any further late filing charges

I've asked the client if he thinks its acceptable to ask someone to do work for them, think you are not going to pay for it and not even have the courtesy to say anything

its disappointing but we'll have the last laugh, invoice issued and client (now ex) advised that legal proceedings will be taken if not paid

his friend has actually filed a 2021/22 tax return with 2021 figures, most of which seem made up. 2020/21 tax return still oustanding so hopefully further late filing penalties will be issued and there will also be a review / penalties for an incorrect 2021/22 return to boot

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Replying to Crouchy:
My photo
By Matrix
14th May 2022 11:30

Haha.

I thought it was bad enough when clients file their own tax returns without letting us know in advance they won’t need us this year.

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Replying to Crouchy:
RLI
By lionofludesch
14th May 2022 11:40

Crouchy wrote:

his friend has actually filed a 2021/22 tax return with 2021 figures, most of which seem made up. 2020/21 tax return still oustanding so hopefully further late filing penalties will be issued and there will also be a review / penalties for an incorrect 2021/22 return to boot

I like your optimistic outlook, however ill founded.

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Slim
By Slim
15th May 2022 16:41

it's happened to me before

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paddle steamer
By DJKL
16th May 2022 14:36

Invoke Kate's "nursing her wrath to keep it warm ", it may take three months, three years or your entire life, but a [***] for revenge will keep you going.

The starred word, so scandalous in the 21st century, is l.u.s.t

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By Tosie
16th May 2022 15:04

Sadly unless a substantial fee it is more trouble than it is worth to try and recover through courts. He will dispute the claim, remember these people do not know meaning of the word truth. The fact that he has amended return will be basis of his argument. He will dream up endless things that you should have claimed for and did not. So annoying.

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By JamesDS
17th May 2022 10:19

There are a lot of debt collection agencies out there touting for work. They will buy your debt at a discount and collect it for themselves. You might consider waiting until the next deadline when he will need some work. Disengage shortly beforehand and send the debt collectors after him. He will have to find a new accountant at short notice (who can be phone-warned when the clearance letter comes in) and he'll have an agency after him, who will make his life miserable for a while at least.

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By HLB
17th May 2022 18:33

Were Accountancy fees included in the submission? If so, false claim. Call HMRC and tell them.

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Replying to HLB:
RLI
By lionofludesch
17th May 2022 19:26

HLB wrote:

Were Accountancy fees included in the submission? If so, false claim. Call HMRC and tell them.

Only if the accounts were prepared on a cash basis. If on the accruals basis, it's a valid claim. The money is still owed.

Still, hard to tell, bearing in mind that the taxpayer has apparently altered the OP's figures. Who knows what's in there?

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seneca
By Seneca
20th May 2022 14:23

What is interesting is to see that the fella knows how to do accounts and tax returns...! Hence he submitted fudged ones.

If it helps to carry your frustration, something similar happened to me. A CIS subcontractor contacted me a month ago to do his accounts and 21/22 return. He didn't have a vehicle, so he asked me if I could pop down to his house, 15 miles away. I did.
When he was giving me the papers, he told me he wanted me to fudge the accounts as another accountant had promised him for the same price than me he would get a massive tax refund. I literally told him if I was going to accept a bribe it had to be for a couple of millions, not £300. So he should go to the other accountant.

As I had already sent 64/8 form I got a letter from HMRC informing him "my client" had been refunded £4k.

I didn't do any work as you did but spent petrol and a couple of hours on the AML and commute to his house.

Some other AW members have recommended to charge for part of the work in advance. Maybe something for you and me to implement soon!

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By Louisemunro320
20th May 2022 14:51

We have decided to move away from the traditional CIS subbies - not worth the hassle for such little fee. For some reason the only ones I dont get a problem with is eastern european who provide all relevant information and pay in advance.
There is lots of work out there and we are fortunate nowadays to select whether the client fits out client base

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By the_fishmonger
25th May 2022 11:29

I see the "hire a hitman" comment has been removed. However...

...during lockdown one of our subbie clients, who frequents the right sort of spit n sawdust hostelries, told us a local bunch of Peaky Blinder types had branched out into guaranteed debt collection work for a 10% cut (because it's easy money if you're prepared to put enough pressure on someone's neck).

Needless to say, we advised him against the use of such agencies for the £8k debt he was owed by 'that rich git' and to take the proper channels.

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