Closing down LTD, accountant asking for 1k+

[Fred Bloggs]

I think Maslins is indeed on the money there. On the occasions I asked an accountant to close down and strike a company off, it was done for no extra charge. Given that the business landscape has irrevocably changed, it seems many of the accountants out there are mining the situation for whatever revenue they can. Inevitable, I suppose, when the government has effectively legislated the business model out of existence.

[Maslins]

It seems this has become a lucrative area for accountants over the last ~2 years, with client having not much option but to suck it up. If you've already paid your accountant a monthly fee all year, then them charging you an extra £1k to help with things like VAT de-registration etc is a rip off IMHO. However, you're in a weak position.

If you were to leave now, sure, they wouldn't charge you the extra £1k, but you wouldn't get any of the monthly fees you'd paid them refunded. Equally any new accountant is quite reasonably going to want paying for the work you'd be asking them them to do. The fact you'd paid lots to your old accountant for little work doesn't help the new accountant. It's unlikely you'll get someone new on board, do all the admin formalities, learn where things are, and help finalise things for under £1k. Cynically I think the old accountant knows this, so whilst it might be a rip off, it's your least bad option.

With the IR35 changes, lots of contractor accountants have lost a lot of clients. I think the above is how many have soothed the financial pain.

Hard to know what's fair in this situation. I personally think query what extra work they're actually doing for that extra £1k, ie that's over and above what the monthly fee covers. Perhaps there's something we don't know about which makes it justified (eg if it includes a formal liquidation cost, it's a bargain!). If you do get some waffly response "ooh we have to de-registere for VAT/PAYE, and we'll need to consider if any fixed assets need disposing" etc, then that's stuff that should be standard IMHO. Challenge it, see if they'll reduce it. If you've otherwise been happy with them, potentially leave a 3-4* review, stating they were ok but levied hefty extra charges at the end. I'm unsure if/how this practice might end unless the firms exploiting it start to get punished in some modest way for it to discourage the behaviour.

[northernladuk]

You sure he's asking for 1k just for doing that and it's not the remainder of the payments for the year.

Although you you pay monthly you are paying for a years service. It's not T&M and you can pay him to do your year end and then stop paying them. It's a full years service. It could be the 1k could be some pro-rata for the year as well as the extra service for closing down.

Get a breakdown of the cost to check and check your T&Cs about payments.

[lofty]

Are there any other accountants that can close down a normal solvent LTD fairly cheaply? A current accountant is asking an insane amount.