I had a Client in 2013, who had set up a Health Bar in a local gymn (sub-letting). He commenced the business in November 2012 and contacted me in January 2013.
I conducted an interview and we were instructed to produce taxation accounts; but given the timing (Mid January and tax year end) ; he was advised that we would have a look at his books in February. BUT. The person from whom he was sub letting is known to this practice; and has a very poor business profile. I cautioned the client against making significant investments.
We picked up his books in February and he had made very significant investment. We were drawing his accounts to 5th April (he had a trading loss, so I was doing accounts from Nov 12 to 5/4/13 to re-claim employed tax paid in the 12/13 tax year.
Long story short, the business (in it's current form), ceased on the 5/4/13. The bailiffs (so I believe) moved into the gymn and my client had a few hours to move his own property. Which he did.He managed to get his stuff out to his Parents' premises.
I was then advised that the Client was seeking new premises; to set up a new Health Bar, but in the interim, freelancing as a consultant/waiter/food preparation....
So prepared the Accounts to 5/4/13 that showed a loss. As the business was not trading at that point; I invoiced the fees; ((July 2013) and requested payment.We both Emailed and posted our invoice.
The Client required clarification as to my fees. I explained that they were applied as a deduction against his accounts; save for that proportion that related to Taxation services. He then required clarification re Depreciation/Capital Allowances; and I explained that at length as well.
In the interim the Client gave up "Self-Employment" and took a job.
The Client could not pay, so his Dad paid them; and I spoke to the Dad and he required clarification re our bank details, so he could pay electronically.I gave him those details.
I showed my full fees on the Accounts. The Client Signed the Accounts on the 24/1/14. I had pre-prepared the tax return; and amended it in front of the client having reviewed it. His business bank account had been closed, and I amended it for this detail; and he also advised that he had a civil partnership and was still married; not yet divorced. All amendments were undertaken, Client signed and then...... as we were just generally chatting and closing. He said that his ex Husband had put all the money into the business.... and it was a very acrimonious divorce and the ex husband wanted his money back........
So I said. If that's the case.... it perhaps should be dealt with as a partnership; and the loss ( and tax refund), wasn't necessarily his alone. I was waved away and told "let the solicitors sort that out".
Just in further chat; I was advised that his self employment since the health Bar was evicted and up to and including his employment, was with one single trader.; basically employed without the hassle So I said... That's not on. You need to tell me specifically what has happened with the assets of the trade; because the refund will need to be repaid in part, potentially; as AIA have been claimed; and there is essentially a cessation of trade.
In May 2014 he wrote an email saying he had moved back with his parents (approx 80 miles away) and had decided to move accountants. I submitted my final bill.
And then it began.
The Client has made a police report for fraud.
A policeman came to my house on Saturday; and I was asked to come to the Police Station yesterday to give a statement under caution.
The Client asserts that I told him that my fee note was advised by me as a payment to the tax office." He has checked with the tax office; and the monies have never been paid.to the tax office".
I went in on Sunday; had to be cautioned; and then had to give a recorded statement
The Police man was very apologetic.
Disclosed my file etc.
I showed my fee notes
Showed the Accounts (signed by client) showing fees as per the Fee Notes
Showed the Tax Comp/Tax Return (signed per Client). In line with accounts/Tax Comp.
The Policeman said that there was obviously no crime; and no further action would be taken; but a crime having been reported, I then had to present under caution.
I am so so sorry that this is so long.
I am just completed devastated and humiliated.