Fixed fees accountant sends extra invoice after work completed - advice needed!

TTI

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Hi,

I have a bit of a difficult situation with my accountant. I am a person who always pays his bills. I always seek a quotation / estimate in advance and once the job is completed the due the paid.

I have a defined fixed fees arrangement with my accountant for my first year of Ltd Company from August 2013-August 2014. He completed an income tax return for 2013 recently and then to my complete surprise sent me a bill ~50% of the fixed annual fees for this work. I queried it and he said that he had quoted me for the same work for Income tax 2014 (presumably to be completed in 2015).

I am going to meet him tomorrow. All dealings have been in writing, and there was no advance notice that this work was outside of the fixed fees arrangement that we had agreed.

Thoughts?
 
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We would normally do a years accounts for a new client and their 2013 and 2014 tax returns as part of one fee. But we would explain to them that there are two tax returns to be done. This avoids any confusion.

If your accountant has agreed to do a set of accounts for 1 year and a tax return for x fee then he should have explained that he was going to do a set of accounts for aug - Dec and 2013 tax return. Then in 2014 the normal fee would apply. Breakdown in communication I would suggest rather than anything else.
 
Hi Joe_90, thanks for your reply. He had given a detailed ten point outline of what he thought would be needed for the year, the last item on that was "income tax return". It seems very strange to me that in August 2013 he would be quoting me for work to be completed in 2015 rather than the work he just did in 2014.

And also out of the 10 distinct categories of work to be done, income tax was one. To give a surprise invoice for half the annual fee for that one item seems a bit disingenuous.
 
In my experience, fixed fees accountancy deals work best for established customers, where there is a clear and mutual understanding of the scope of the work and the expectations of both sides.

I wouldn't personally be enamoured with the idea of doing the first year accounts from August 2013-August 2014 as there are clear benefits from adhering to calendar year ends, but each one to their own.
 
In my experience, fixed fees accountancy deals work best for established customers, where there is a clear and mutual understanding of the scope of the work and the expectations of both sides.

I wouldn't personally be enamoured with the idea of doing the first year accounts from August 2013-August 2014 as there are clear benefits from adhering to calendar year ends, but each one to their own.

It is a LTD Company. What are the options for choosing your year end? Would it have to had been done to 31/12/2014 or could it be stretched to 31/12/2015?
 
It depends on your ARD and the type of business you operate in. I generally recommend a calendar year end, where possible. Did your accountant not discuss this with you?
 
It depends on your ARD and the type of business you operate in. I generally recommend a calendar year end, where possible. Did your accountant not discuss this with you?

No, there was no suggestion about aligning year end with calendar year end. ARD is March. Sector is IT/Software Development.
 
I don't particularly want to criticise someone behind their back but they really should have discussed this with you. That said, one of the reasons why I don't think fixed fee deals are a good idea for start-ups is that they don't particularly incentivise the advisor to think outside the box and suggest better ways of structuring things from the outset.
 
I should have added, March is a particularly bad time of year to have an ARD date, as you cannot file a B1 for a given year until at least 1 January in that year, so if accounts are completed soon after the year end, you will have to wait months to file with the CRO.
 
I should have added, March is a particularly bad time of year to have an ARD date, as you cannot file a B1 for a given year until at least 1 January in that year, so if accounts are completed soon after the year end, you will have to wait months to file with the CRO.

Thanks for the knowledge.
 
I have to meet him tomorrow, so I'm trying to get all my ducks in a row. In one email responding to my querying this additional charge he mentioned that the quote fees were for company accounts up until 31.12.2014. So reading this previous thread:
http://www.askaboutmoney.com/showthread.php?t=141691

Is it possible to have annual accounts from September 2013-31st December 2014? And if I understand correctly, the next NARD is March 2015 - one year after the first one in March 2014. ?
 
Yes, but you can extend your ARD by up to 6 months, ie to a date in September 2015 for submission of accounts up to 31 December 2014.
 
Thanks all for the advice. I sat down with the accountant this afternoon and we reached an amicable way forward and I also got the end of company year changed to align with the calendar year.
 
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