Have to admit we prefer direct debit...but to date haven't forced it on clients.
Three mains reasons for this:
1) admin - we get one huge receipt rather than lots of little ones. We can also dictate the reference (so many clients set up a standing order with the invoice number as reference...which for any invoice beyond the first isn't helpful!)
2) possible rate changes - Ok the VAT rate's been stable at 20% for a few years now, but there was a time when it was jumping all over the place, 17.5%, 15%, 20%. Getting clients to all individually update their standing order was a big pain. Us updating DD amount was a doddle. Also there may be reasons other than VAT which cause the amount payable to change.
3) cash flow - it helps our planning when we can confidently know we'll get £X on a certain date each month.
I appreciate it's only (2) of the above that potentially benefits the client...but as others have said, if there's a cock up you should get an almost immediate refund from your bank. You have more control/power to get funds back if they're taken via DD than if you've voluntarily sent them.
Three mains reasons for this:
1) admin - we get one huge receipt rather than lots of little ones. We can also dictate the reference (so many clients set up a standing order with the invoice number as reference...which for any invoice beyond the first isn't helpful!)
2) possible rate changes - Ok the VAT rate's been stable at 20% for a few years now, but there was a time when it was jumping all over the place, 17.5%, 15%, 20%. Getting clients to all individually update their standing order was a big pain. Us updating DD amount was a doddle. Also there may be reasons other than VAT which cause the amount payable to change.
3) cash flow - it helps our planning when we can confidently know we'll get £X on a certain date each month.
I appreciate it's only (2) of the above that potentially benefits the client...but as others have said, if there's a cock up you should get an almost immediate refund from your bank. You have more control/power to get funds back if they're taken via DD than if you've voluntarily sent them.
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