problem with accountant

[bcsltd]

Hi everyone,

I have contacted this accountant in Feb when I was ready to incorporate my limited company. They agreed to me in email that there would fix fee of 99+vat which will be applicable only when company starts trading and they also agreed to setup the company for free.
Below is the extract from the gold package they promise me for 99+vat:

Bookkeeping (Including payroll, VAT, & Company Secretarial):

• Provision of bookkeeping forms for expenses, invoicing etc
• Reconciliation against bank statements
• Company & Employee payroll
• P45/P60/payslips/salary advice
• VAT returns and scheme administration
• P11D, P35 & P14

Company Accounts:

• Preparation & Filing of Company Accounts
• CT Computations

IR35

• Up to 2 IR35 Contract Reviews per annum

Self Assesment:

• Straight forward personal tax return included

Sundry

• Tax Advice
• Dedicated Accountant – email & phone support
• Monthly newsletter

My company actually started trading on 8th March but so far I have paid them ￡117.00 twice. First payment was on Feb 17 when they asked me to pay towards company formation efforts but they would wave off the first month's fees in return. Second payment was on 9th April which I thought to pay upfront for following month.

Since Feb till today they offered me following things:

• No more than 3 hours of occasional telephone or email communication when I wanted to ask about various things such as what is PAYE, NIC, VAT & Corporation Tax or Various HMRC VAT related queries
• Provided me salary slips for Jan and Feb (even though company was not formed I have asked them to provide me salary slip for Jan and Feb in order to get paid toward the efforts went into formation of company)
• Did payroll for fiscal year 09-10 (even though I have not provided them my March salary or any previous income)
• Advised me to pay some PAYE and NIC to HMRC based on payroll

I was surprised to see PAYE and NIC amount figure, and I have asked my accountant how did he calculated but I have not received any details.
I have realized that taking salary for Jan and Feb may have complication as the amounts withdrawn would be treated as a director’s loan and this would cause further complications and would need to be reported onto a P11d so I have asked my accountant to re-do payroll by providing appropriate advise and by taking accurate inputs.
This is when my accountant asked me to pay extra fees and bullied me that he will charge me on hourly basis something up to ￡1200.00 if I choose to move book.

Was I not timely on paying fixed fees?
Don't I deserve to enquire on any queries I may have?
Shouldn't my account offer me correct advice (atleast initially) on how and when I should withdraw?

I have all the email communication so far and I do not see anything extra I have asked than what their gold package was supposed to cover.

How can I handle this greedy accountant who may put me in various troubles?

I really appreciate time you spent so far helping me out.

Many Thanks,
gcsltd

[NotAllThere]

Previous two messages deleted. Please keep it civil.

[NotAllThere]

My guess is that you've signed up with the accountant for a year. £99 x 12 = £1200 as near as anything.

He's saying that if you wish to switch accountants, then he'll charge you for the work that he has done on an hourly basis - up to a maximum of £1200. So, if his hourly rate is £100, and he's done 5 hours work, he'll charge you £500. If you're signed up for a year, it doesn't seem unreasonable as an exit charge.

As a contractor, you need to understand what a contract is. Not just the contracts between you and the agency, but all other contracts you sign. Does the agreement you've signed allow him to make these charges?

On the face of it, I don't actually see anything necessarily unreasonable. You have your expectations and understanding - he has his. What we have here is a failure to communicate.

[bcsltd]

Hi,

I agree that all contracts must be read and understood before signing but when my accountant proposed me, all he said that it is a 99+vat monthly fee with no obligation to leave. T & C should have been sent at the time of proposal and He did not send me T & C until I have paid a first month fee.
As mentioned in my previous post, the package which they offer me does include advice on payslip salary, dedicated phone and email support. So there is no reason why he should charge me extra for simple enquiry on how has he calculated my PAYE and NIC.
Moreover, I expect that accountant should give correct advice as otherwise client could end up in penalties.

Many thanks

[NotAllThere]

Learning experience - get the T&Cs before signing up for anything. That's due diligence and it is your responsiblity as company director.

I'm still unclear. Is he charging you extra for explaining your payroll, or is this "extra" coming from you wanting to switch accountants?

Further - what bad advice has he given you?