accountants keep my vat gain from flat rate

[jiminajam]

Hi,

I was with an accountants for my previous contract. About midway through this year they told me that they were moving to a new charging structure to make things more transparent. The transparency, at first, seemed to be costing more money. So I called them.

When I started with them, they told me they charge a flat rate of up to £26 per week depending on the amount invoiced. The new 'transparent' charges included this £26 per week, plus a monthly £88 'processing charge' which seemed extortionate. Anyway, I've taken measures against this and set up a new company.

When I called the accountants they explained the transparency as;

Well before, you see, we were keeping the margin between the 17.5% VAT rate and the 12% flat rate scheme that we registered your company for when we set it up. So, in actual fact, you are taking home more money now than what you were before we made this change. Great.

What about the 5.5% / 4.5% of all invoices issued in the past year that you creamed from me without me knowing about it? Which would amount to something like £6000 over the 2 years?

I don't feel very 'great' about it.

Now, I can see the responses to this, saying you should have known etc. call me naive but I didn't expect my accounts to be royally shafting me.
I mean, all in all, I've probably contributed £10k to my ex accountant over the past 2 years, for a company with a turnover less than £75k this is highwayman stuff.

Is there anything I can do about this?

Jim.

[Jason D]

Jason D

Outrageous.

When you first instructed them, the basis for their charges would have been included in the engagement letter. Dig it out and see what it says. If you cannot find it then ask for a copy.

PM me if you like.

[dude69]

sue the mo-fos. Sue, sue, sue.

Evil robbing barstards.

[Waldorf]

What sort of accountants are keeping hold of your money anyway? You need to see what you agreed but it sounds very odd.

Are you going to name them?

[jiminajam]

2 words;

1st; 'sounds like' say, another name for wage
2nd; 'sounds like' dream, small river

I wonder how many other contracters were offered this unique service.

[vhadiant]

What's in your term & condition with the accountant? It's dodgy if they have this non-transparent fee structure. Any chartered or professional accountants should follow ethic code set by their professional organisation. If they breach this you can report them to their respective organisation.

[SueEllen]

If they breach this you can report them to their respective organisation.

I think you mean "should".

[Bluebird]

why do your accountants see any of your money apart from that which you pay them ?

[Sockpuppet]

2 words;

1st; 'sounds like' say, another name for wage
2nd; 'sounds like' dream, small river

I wonder how many other contracters were offered this unique service.

Remove word accountants and insert word MSC then it starts to make more sense.

They are not "real" accountants.

[jiminajam]

yes,

MSC, that's why I've moved away from them. Since the start of this tax year, my agency has been paying my directly into my company bank account, before that, all cheques were made out to the 'accountants' then they submitted it to their bank account, then paid me on behalf of my company.

It was my first contract and was given the easy sell by the recruitment agent, saying they were affiliated with these accountants, and that they were their preferred partners, making it easier and quicker to get paid.

I live I learn. I'm going to root out any paperwork I have on it, but I don't ever remember actually signing anything. I'm loathe to do something hastily about this as they still need to submit the company annual accounts etc. to get it closed down.

Has anyone else been in the same situation. I'm sure I'm not the only one in this pickle.