Have I been Conned?

[MrRobin]

Caveat emptor

When you make a big spending decision, do you always take the first offer or accept the first thing you are told? No, you would shop around and do your own research.

Sorry you got stung but it really is a lack of common sense that got you into this. Good luck.

[Lewis]

Nope, I certainly didn't misunderstand the advice, I asked the guy so I have £100,000 in my account how much will I pay, he said 10%, so I said ok all the tax I will pay from my account is £10,000 and he said yes, how much more clear can that be?

You really should stop saying "I" when you mean "your company". You and your company are separate entities, your company has £100,000 in it's account not you. Your company pays 20% corporation tax, you pay your tax. So when the advisor says "You will pay 10% tax" that is perfectly correct. You don't pay your company's tax, it does. This is all basic stuff, didn't you accountant send you any basics on running a company?

That said, your account should have given you the ESC C16 advice for FREE! And should charge at most a few hundred quid to close down a company. As for starting a new one that should be a few hundred quid also. It sounds like they're in this together.

£12,000 is unbelievable, I mean seriously outrageous!! I have never in a decade of contracting ever heard of such a large sum of money being charged for such trivial piece of advice and work.

Out of interest what do you do? If you were operating through an LLP (plus were thinking of doing it again) then presumably you're not a standard IT contractor; agencies don't deal with LLPs to the best of my knowledge.

[spud5706]

I would need a transcript....

however, he is correct.

He can easily have assumed you already thought of the 20% CT liability as you have an accountant.

Hey what about VAT! I'm surprised you aren't complaining that you also owe VAT...

If you told me you had 100k in "your" account I would also assume that you have already paid all CT and VAT and were looking at a way to get at the 100k.

he overcharged. but most of this looks like misunderstanding on your part.

£100k was earned this year like stated previously I have not paid any corp tax on it yet, he sold the scheme as you pay a flat fee of 10% not sure why that is so hard to understand?

Saying I should know I have to pay corp tax on it is ridiculous when he says 10%.

You really should stop saying "I" when you mean "your company". You and your company are separate entities, your company has £100,000 in it's account not you. Your company pays 20% corporation tax, you pay your tax. So when the advisor says "You will pay 10% tax" that is perfectly correct. You don't pay your company's tax, it does. This is all basic stuff, didn't you accountant send you any basics on running a company?

That said, your account should have given you the ESC C16 advice for FREE! And should charge at most a few hundred quid to close down a company. As for starting a new one that should be a few hundred quid also. It sounds like they're in this together.

£12,000 is unbelievable, I mean seriously outrageous!! I have never in a decade of contracting ever heard of such a large sum of money being charged for such trivial piece of advice and work.

Out of interest what do you do? If you were operating through an LLP (plus were thinking of doing it again) then presumably you're not a standard IT contractor; agencies don't deal with LLPs to the best of my knowledge.

No my advisor said I will pay 10% of the money in my business account and yes £12,000 is ridiculous, I work in the IT industry yes.

[northernladuk]

Personally I would stop posting explaining yourself and let this one die. It is keeping your thread at the top so everyone can have a pop at you!

[prozak]

£100k was earned this year like stated previously I have not paid any corp tax on it yet, he sold the scheme as you pay a flat fee of 10% not sure why that is so hard to understand?

Saying I should know I have to pay corp tax on it is ridiculous when he says 10%.

No my advisor said I will pay 10% of the money in my business account and yes £12,000 is ridiculous, I work in the IT industry yes.

Sorry. you really don't seem to get it.

You weren't misled.
You were overcharged.

Don't waste money going the misled route. You'll be made to look a fool.

I now have no doubt that you refered to "your" money in the business account. Which straight away led the adviser to assume that it was profit after tax. In which case his advice was spot on. You can get "your" money out for 10%.

[philip@wellwoodhoyle]

I have £100,000 in my business acccount and when I met with the tax advisor he told me he could get ALL my money out and I would only have to pay 10% tax on it

You've simply been over-charged and can't do anything about it sadly. You could have shopped around and got the same advice a lot cheaper, if not free. Just kick yourself and move on.

You said it yourself in the above when you said "my money" - you've completely ignored the fact that it wasn't "your" money - it was the company's, and the company has to pay it's tax liabilities first. Any reasonable person would have assumed that when you say "my money" you infer that's the amount left after taxes etc attributable to you. You, personally, don't pay the company tax.

Was your contract or letter of engagement between them and you personally, or between them and your limited company. To be frank, if it wasn't addressed to the limited company, then it was outside the scope of the adviser's remit to consider what taxes the company was liable for - he was simply telling you the way to get the money out of the company, and he's given you sound advice for that. Grossly overpriced, but if you agreed to that fee, then there's nothing you can do.

Move on and get yourself a good accountant for next time.

[spud5706]

Sorry. you really don't seem to get it.

You weren't misled.
You were overcharged.

Don't waste money going the misled route. You'll be made to look a fool.

I now have no doubt that you refered to "your" money in the business account. Which straight away led the adviser to assume that it was profit after tax. In which case his advice was spot on. You can get "your" money out for 10%.

No, you don't seem to get it, you can't claim something and then say at a later date 'Well of course you should have known about that'!

Why should I know about that? I'm paying a tax advisor to save me money and when he tells me I can get, and I quote

'Everything that is currently in your business account out at 10%'

Then why should I assume its 10% + 20%? He just flat out told me he would get my £100,000 out for £10,000 so that is a LIE.

And even if you contest this point, you cannot contest that his advice including fees makes me pay over £10,000 MORE so selling me this scheme and I quote his words again

'You will save money with this'

Is ridiculous, I'm not even sure how you can start to justify it, its like someone signing you up to a new energy provider telling you that you are going to save 30% off your bills yet when the actual bill comes its 50% more, you cannot just lie and tell the client what he wants to hear and then deliver something totally different.

BTW, why should he 'Assume' that it was profit after tax? HE NEVER ASKED, This must be the most basic question to ask, I think he assumed the £100k was not made this year.. But it was.

We will see how he justifies it when I post his company all over the web with his fees/pitch and what he sold me and then see how many more clients he gets.

[spud5706]

You've simply been over-charged and can't do anything about it sadly. You could have shopped around and got the same advice a lot cheaper, if not free. Just kick yourself and move on.

You said it yourself in the above when you said "my money" - you've completely ignored the fact that it wasn't "your" money - it was the company's, and the company has to pay it's tax liabilities first. Any reasonable person would have assumed that when you say "my money" you infer that's the amount left after taxes etc attributable to you. You, personally, don't pay the company tax.

Was your contract or letter of engagement between them and you personally, or between them and your limited company. To be frank, if it wasn't addressed to the limited company, then it was outside the scope of the adviser's remit to consider what taxes the company was liable for - he was simply telling you the way to get the money out of the company, and he's given you sound advice for that. Grossly overpriced, but if you agreed to that fee, then there's nothing you can do.

Move on and get yourself a good accountant for next time.

The letter of engagement was addressed to my LTD company.

[prozak]

I give up.

You obviously know better.

He definitely lied to you. In which case this is a criminal matter as he has defrauded you.

You need to go to the police, not post here.

or here : http://www.actionfraud.org.uk/

[Churchill]

No, you don't seem to get it, you can't claim something and then say at a later date 'Well of course you should have known about that'!

Why should I know about that? I'm paying a tax advisor to save me money and when he tells me I can get, and I quote

'Everything that is currently in your business account out at 10%'

Then why should I assume its 10% + 20%? He just flat out told me he would get my £100,000 out for £10,000 so that is a LIE.

And even if you contest this point, you cannot contest that his advice including fees makes me pay over £10,000 MORE so selling me this scheme and I quote his words again

'You will save money with this'

Is ridiculous, I'm not even sure how you can start to justify it, its like someone signing you up to a new energy provider telling you that you are going to save 30% off your bills yet when the actual bill comes its 50% more, you cannot just lie and tell the client what he wants to hear and then deliver something totally different.

BTW, why should he 'Assume' that it was profit after tax? HE NEVER ASKED, This must be the most basic question to ask, I think he assumed the £100k was not made this year.. But it was.

We will see how he justifies it when I post his company all over the web with his fees/pitch and what he sold me and then see how many more clients he gets.

It's God punishing you for trying to rip-off HMRC - bad Karma comes around!