Returning an overpayment

[Kess]

Dissolve your company and run off to the Caymen islands with the £4,500. You'll be laughing!

I think there would have to be a few more zeroes on the end before I'd consider that!

Thanks for the advice everyone. I'll put something formal in writing to them and put the ball back in their court.

Kess

[Lewis]

A couple of weeks ago my agent overpaid me by £98. Not a great amount, but trying to get them to recover it is proving rather interesting.

Following my latest call yesterday to their accounts dept about sorting it they responded immediately ... by dumping a further £4,500 in my account! Needless to say I just called their accounts dept again and was met with a surprising level of disinterest.

Any suggestions what to do next - at this rate I'll be a millionaire by next year! What's the normal mechanism (if any) for returning an overpayment - deducting it from a future invoice, sending them a cheque, or what?

Kess

I had a similar problem recently with a number of over payments by the agency and again they didn't seem bothered (it came to about £500 in all). In the end I had to get quite insistant! I could have kept it and waited for them to ask but to be honest I just wanted my accounts to add up! I'm sure I would have eventually had to pay it back so why not just get it over with. In retrospect maybe I should have just banked it and got the interest.

[Flat Eric]

I'm in a similar situation. My agency has overpaid me about £30.

If they ask for it back I'll write them a cheque, no problem.

BUT.... How will this affect my accounts. Surely my accountant isn't going to quibble over £30 especially as it's in my favour.

If this really is a problem for my accounts then myco can write me a cheque to cover the £30 quid, thus levelling out the books and if they agent want's his money back I'll write him a personal cheque.

Does this all sound OK?

M.

[contractor58]

I once has a £10,000 overpayment.

There was no way I could have kept it because my books wouldn't have balanced. I just waited a while (approx 3 months I think) then informed the agency and paid it back.

I got a bit of interest on the money, they got their money back, my books all balanced nicely ...everyone's happy!

[Bluebird]

I once has a £10,000 overpayment.

There was no way I could have kept it because my books wouldn't have balanced. I just waited a while (approx 3 months I think) then informed the agency and paid it back.

I got a bit of interest on the money, they got their money back, my books all balanced nicely ...everyone's happy!

Hope you paid CT on the interest...

[DaveB]

I'm in a similar situation. My agency has overpaid me about £30.

If they ask for it back I'll write them a cheque, no problem.

BUT.... How will this affect my accounts. Surely my accountant isn't going to quibble over £30 especially as it's in my favour.

If this really is a problem for my accounts then myco can write me a cheque to cover the £30 quid, thus levelling out the books and if they agent want's his money back I'll write him a personal cheque.

Does this all sound OK?

M.

No, not ok. The correct way to deal with it, afaik, is to enter it into your accounts as an overpayment from <name of agency>. By entering it as an over payment, to be returned, it is not part of your profits for CT purposes and your books balance with your bank accounts. When the time comes to pay it back enter it as a refund of the overpayment. Everything balances and theres no mucking about needed. However, you will need to account for any interest it earns and pay CT on that as it does count as profit.

IANAA.

[Kess]

*Sigh*

Another week, another £1500 overpayment, so I'm now holding over £6000 of the agent's money. To make matters worse they've finally woken up to the situation and (without bothering to actually make any contact with me to discuss the matter) the latest advice note shows they've made a large deduction from my last invoice. Unfortunately they've deducted the wrong amount...

My company account is getting increasingly screwed up by these jokers. Is it reasonable to consider imposing an administrative fee for the time it's taking me to sort the mess out or do I just grin and bear it?

[ChimpMaster]

*Sigh*

Another week, another £1500 overpayment, so I'm now holding over £6000 of the agent's money. To make matters worse they've finally woken up to the situation and (without bothering to actually make any contact with me to discuss the matter) the latest advice note shows they've made a large deduction from my last invoice. Unfortunately they've deducted the wrong amount...

My company account is getting increasingly screwed up by these jokers. Is it reasonable to consider imposing an administrative fee for the time it's taking me to sort the mess out or do I just grin and bear it?

Well they've probably broken the contract several times over nwo so why don't you write them a stern letter indicating that you will be terminating the contract between you and them. Tell them that they have caused significant difficulties with your company accounting and with your cashflow. Then you can go to a cheaper agency or direct to the client if the client allows that!

[TheFaQQer]

Is it reasonable to consider imposing an administrative fee for the time it's taking me to sort the mess out or do I just grin and bear it?

I would write to them pointing out the mistakes, and the time that this is taking to sort out. Give them one last chance to get it right, but tell them in writing that any further time spent rectifying their mistakes will be charges at £90 an hour (or part thereof) plus VAT. Failure to pay that will result in terminating the contract for breach.

[Kess]

Thanks for the advice guys, a strongly worded letter has been drafted and shall be sent tonight.

They certainly breached the contract in one respect - they're not meant to take any deductions (let alone spontaneously grab almost £1500 from one invoice!) without "reasonable notice in writing".

The silly thing is that I would've been quite happy to be flexible, relax, and hang on to their money : for a little longer if they'd asked - I've heard the agent is struggling with a dodgy, sorry, fancy new accounts IT system and are quite sensibly giving priority to dealing with contractors who've been underpaid rather than overpaid. All they had to do was talk to me, respond to any one of my calls or e-mails. It's the total lack of communication I find so unprofessional and frustrating, yet rather commonplace these days.