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Should I complain ?

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    Should I complain ?

    Now that I have close to 1 year of contracting and have a reasonable understanding on the proceeds, I would like to ask you pros whether the following experience that I got from my accounting firm (highly and consistently recommended in these forums) is as expected or should I complain ?

    1. They charge a set up fee + 2 months free accounting. I started the setup activities in July but started contracting only effective September. Everything done in July and August was set up activities which was paid for separately which means September and October should have been free. But I was billed from October and when queried was not addressed properly. There was so much going on as a newbie contractor that I had no time or energy to chase it up.

    2. I was assigned an accountant without any explanation why he was chosen. I had not talked to him even once before. He was always helpful in answering my queries quickly but any discussion ended in a few seconds, the conversation never flowed. Then all of a sudden he was replaced with a new person without giving any reason.

    3. Heeding to the advice from this forum, I had requested a Freeagent demo at the start. But I got a reply question "What do you want to know in it" As a newbie it made no sense at all initially and after getting no where with the demo request, I did my own reading and youtube videos.

    4. Now to my biggest issue: I never got a holistic picture explanation of how all the cogs and wheels and levers of a LTD company accounting works together. Again after not getting anywhere with the explanations received, I sat down and created my own spreadie starting from the Day rate through VAT charged/payable, Expenses, Pensions, Corporation tax, profits for divident, share split scenarios, existing PAYE salary, NI thresold salary, Tax bands, PAYE tax, Dividend tax, Income tax all of which was done trial and error by reading this excellent forum, many other internet sites, talking to other contractors etc. I should have spent 100s of hours to reach to this stage where I can tweak numbers in my spreadie and be sure how the final tax owed will look like. So am I paying now just for reminders and admin ?

    5. Excellently reactive in answering any queries but there has been no proactive advice on any tax planning except for vague suggestions to invest in pensions. I was expecting the accountant to ask some more queries on personal circumstances and challenging/suggesting ways to reduce tax liability (I am not talking about financial adviser investment advice or any schemes)

    6. Share splits: In the previous tax year, the share split % was decided between me and the spouse but I had permie PAYE salary component from the first few months. Now this tax year, it is not there which means the share split received by my spouse is turning out to be a burden to avoid the higher rate dividend tax. The implications of the tax split % one year down the line was never explained properly as the calculation was predominantly concentrated only for the first tax year.

    #2
    All sounds pretty standard to me. If no one else has I'll break each one down later but don't see and issue with any of that TBH.

    You are paying absolutely bottom dollar for a sausage factory accountant as its pretty straightforward for us so you aren't going to get a gold plated service. They will do the numbers and answer some questions, that's about it. How much time and effort would give your client for 90 quid a month?
    'CUK forum personality of 2011 - Winner - Yes really!!!!

    Comment


      #3
      You did read CUK and ipse contracting guilds to answer all your questions ?

      FreeAgent does your accounting - what’s in your spreadsheet

      No you should not complain

      Comment


        #4
        Originally posted by PoH View Post
        Now that I have close to 1 year of contracting and have a reasonable understanding on the proceeds, I would like to ask you pros whether the following experience that I got from my accounting firm (highly and consistently recommended in these forums) is as expected or should I complain ?
        No. Here's why;

        Originally posted by PoH View Post
        1. They charge a set up fee + 2 months free accounting. I started the setup activities in July but started contracting only effective September. Everything done in July and August was set up activities which was paid for separately which means September and October should have been free. But I was billed from October and when queried was not addressed properly. There was so much going on as a newbie contractor that I had no time or energy to chase it up.
        It's an unusual situation for most contractor accountants who will get a client that is starting in the very near future so they are geared up to getting a company up and running as quickly as possible so the contractor can get on site. You'll have to push a bit harder but they probably will sort the billing out, it's just not a normal situation for them.

        Originally posted by PoH View Post
        2. I was assigned an accountant without any explanation why he was chosen. I had not talked to him even once before. He was always helpful in answering my queries quickly but any discussion ended in a few seconds, the conversation never flowed. Then all of a sudden he was replaced with a new person without giving any reason.
        Not sure what you thought would happen here. Contractors will get assigned to accountants based on a rota and current client allocations, there's no special matching algorithm to pair up IT contractors with a specific accountant at any of these places. They will often be under KPI's to get queries sorted quickly and on to the next one as they will have probably well over a 100 clients allocated to them. Staff churn in the industry can be quite high so changing of accountants is something you will need to get used to.

        Originally posted by PoH View Post
        3. Heeding to the advice from this forum, I had requested a Freeagent demo at the start. But I got a reply question "What do you want to know in it" As a newbie it made no sense at all initially and after getting no where with the demo request, I did my own reading and youtube videos.
        It's got a lot of functionality so it makes sense for them to try and tailor what they are going to show you. You may be primarily concerned with getting your invoices out so they would need to spend time talking about raising the invoice, VAT implications, VAT only invoice implications if post-reg but pre getting VAT number so I think that is a fair ask on their behalf

        Originally posted by PoH View Post
        4. Now to my biggest issue: I never got a holistic picture explanation of how all the cogs and wheels and levers of a LTD company accounting works together. Again after not getting anywhere with the explanations received, I sat down and created my own spreadie starting from the Day rate through VAT charged/payable, Expenses, Pensions, Corporation tax, profits for divident, share split scenarios, existing PAYE salary, NI thresold salary, Tax bands, PAYE tax, Dividend tax, Income tax all of which was done trial and error by reading this excellent forum, many other internet sites, talking to other contractors etc. I should have spent 100s of hours to reach to this stage where I can tweak numbers in my spreadie and be sure how the final tax owed will look like. So am I paying now just for reminders and admin ?
        For £90 a month or the like you can't distill 4 years worth of accountancy training into a few quick conversations or emails. To go through the ramifications of an overdrawn Director's Loan with S455, Class 1A nics, interest or the LEL, UEL, when it comes to NI within the timescales they have is just not feasible, you will always get a whistlestop tour of how it works but it's never going to be a holistic deep dive. I don't think any of them will be in a position to offer that kind of detail.

        Originally posted by PoH View Post
        5. Excellently reactive in answering any queries but there has been no proactive advice on any tax planning except for vague suggestions to invest in pensions. I was expecting the accountant to ask some more queries on personal circumstances and challenging/suggesting ways to reduce tax liability (I am not talking about financial adviser investment advice or any schemes)
        This is something they do all claim to provide "pro active advice" but it's all very standardised based on average circumstances. The chances of you getting some bespoke tax advice from a contractor accountant are extremely low, they need to know all of your personal circumstances, other sources of income, future plans and a lot of info that 99% of their client base won't bother them with. They are geared up for the 99% I'm afraid.

        Originally posted by PoH View Post
        6. Share splits: In the previous tax year, the share split % was decided between me and the spouse but I had permie PAYE salary component from the first few months. Now this tax year, it is not there which means the share split received by my spouse is turning out to be a burden to avoid the higher rate dividend tax. The implications of the tax split % one year down the line was never explained properly as the calculation was predominantly concentrated only for the first tax year.
        Again this will be down to time and resource. They can't really go through all possible future scenarios in respect of income fluctuations for either party so they will go with what fits at the time and then deal with the next year when that happens. If you want that kind of detailed advice then you need to paying a lot more cash.

        If you're getting your queries answered quickly, not having to chase them up constantly and you trust what they are telling you (in the main) then that's pretty much what you can expect for the fees most of them charge.

        Comment


          #5
          Yep this is a pretty standard experience.

          I too find it useful to maintain an awesome spreadsheet - purely for planning the year for personal tax and dividends, based on assumptions (like having a revenue stream)

          Comment


            #6
            Excellent post from VelcroPower so saved me having to do it.

            Not much to add to that really. If you are with who I think you are with you will get a review of your account every 3 months at VAT time. They will point out things like you haven't claimed your office allowance, wrongly allocated expenses, query and large or odd looking entries and so on which is pretty useful to be fair but even then it's just keeping your accounts in order rather than proactive advice.

            They are just glorified book keepers so it's up to you to run your business. Don't be disheartened about the amount of time you've spent learning. It will put you ahead of a vast majority of contractors and if you hang around here long enough you'll see that from the some of the dateless posts people put up, particularly those in trouble because they've not taken the time to understand the basics.

            I don't think I've ever seen advice saying ask your accountant to give you a demo? I am sure in the past people have said you can sign up for FA for free so you can have a play. It's very straightforward and there is a freeagent forum to check if you have questions. Accountants can charge upwards of 80 quid an hour so you can't expect much from them for 90 quid a month as I've already pointed out.

            Sounds like you are in exactly the same boat as the rest of us so nothing to worry about even if it hasn't met your expectations.
            'CUK forum personality of 2011 - Winner - Yes really!!!!

            Comment


              #7
              all good advice so far.

              I'd add that if the OP wants to have a conversation and feel loved that he writes a list of queries, not dissimilar to his list, stick them in an email and ask for half an hour to talk through them at a convenient time.
              They'll arrange a time to do that and it will also allow them to prepare answers for your questions.
              See You Next Tuesday

              Comment


                #8
                Originally posted by Lance View Post
                all good advice so far.

                I'd add that if the OP wants to have a conversation and feel loved that he writes a list of queries, not dissimilar to his list, stick them in an email and ask for half an hour to talk through them at a convenient time.
                They'll arrange a time to do that and it will also allow them to prepare answers for your questions.
                And it gives you a chance to lay out exactly why you think billing should have started later, instead of recounting it verbally to someone who may not be listening as well as they should.

                Comment


                  #9
                  As a small practice owner, I'd agree with the above. I appreciate you're disappointed, and that always sucks...but I do feel your expectations are too high.

                  You could change accountants, but I imagine most will follow a similar pattern.

                  The word "proactive" is one that pains me. To some clients us telling them "Hello, a reminder your tax of £X is payable in a fortnight" is amazing proactivity. To others, they seem to think being proactive means we should know what they're thinking about doing, before they do it, and advise them on it, without them mentioning what they're thinking first. We're not mind readers.

                  (2) is something we know is a real bone of contention with clients. They feel like they have a relationship with their accountant Joe Bloggs who understands their business, then get a message out of the blue that Joe's disappeared and someone else will be assisting. Most accountancy firms will know that low staff turnover is a key to long term success, but the reality is people's circumstances change. They emigrate, seek an opportunity in another firm, get pregnant, decide to change career completely. As employers we can't stop that. All we can do is hopefully provide a nice working environment so they stay fairly long before eventually, inevitably, decide it's time to move on.

                  You can grumble to the accounting firm if you like. They might offer some kind of goodwill gesture. However trying to complain beyond that (eg to an accounting institute) would be a complete waste of your time. It doesn't sound like they've done anything wrong, other than not meet your perhaps unrealistically high expectations.

                  Comment


                    #10
                    Originally posted by Maslins View Post
                    (2) is something we know is a real bone of contention with clients. They feel like they have a relationship with their accountant Joe Bloggs who understands their business, then get a message out of the blue that Joe's disappeared and someone else will be assisting. Most accountancy firms will know that low staff turnover is a key to long term success, but the reality is people's circumstances change. They emigrate, seek an opportunity in another firm, get pregnant, decide to change career completely. As employers we can't stop that. All we can do is hopefully provide a nice working environment so they stay fairly long before eventually, inevitably, decide it's time to move on.
                    In order to keep prices down many get younger, less experienced, staff in (actual children in a lot of circumstances), train them up and then they just move on because they want audit work or to do SME accounts or they get tempted over to the dark side (Management Accounts), or just not be part of a sausage factory so you will get higher staff turnover than in most other accountancy disciplines.

                    Comment

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