accountants bill

[throdge]

hello everyone i need advice.my accountant has just sent me a bill,this is the first bill he has sent me in 10 years.it is for 9 years of doing my accounts.he wants paid now ,i cannot pay this bill at the present time but have offered to pay by installments over 12 months.if i pay him this way he says he will charge 16% interest.he said on the bill it was his fault(i take some of the blame as well). what should i do.is it right he should charge me interest.

[MyAccountantOnline]

hello everyone i need advice.my accountant has just sent me a bill,this is the first bill he has sent me in 10 years.it is for 9 years of doing my accounts.he wants paid now ,

This is surely a wind-up - an accountant who hasnt billed you for 9 years!!??

[lesliedocherty]

I agree, must be a joke, but if it aint, its still quite funny

[Jaydee]

But if you are not VAT registered, just think of the money that you have saved as 9/10ths of it should have been at 17.5% :)

[elainec100@cheapaccounting]

what's the date today?

Not April fools.

[throdge]

thought i was going to get some constructive advice,guess i was wrong

[selfeax]

thought i was going to get some constructive advice,guess i was wrong

Hi,

It just isn't very often that we see a situation like this. Not sure i understand why your accountant would wait 10 years to issue a bill but on the issue of interest payments, does his terms and conditions state that he has the right to charge an interest on late payments? If so, then he is well within his rights to charge an interest for spreading the payment over your suggested period - although IMHO, 16% is a bit steep - or maybe he is trying to make up for not billing over the last 9 years?

[OldWelshGuy]

You cannot chace a debt that is over 7 yrs old for a start!

[Jaydee]

True - but I suspect that the debt is not a debt until it is billed - and so the "debt" is within time.

[Jaydee]

thought i was going to get some constructive advice,guess i was wrong

1. Why do you take part of the blame that the accountant has not raised fee notes?

2. You have had the benefit of nine years' unpaid fees in your cashflow too.

3. Have they now charged ten years' fees at today's charge-out rates or have they stepped them up through the years with inflationary increases?

4. Have you agreed to T's and C's allowing interest of any rate to be charged? If not, I suspect that they cannot charge more than statutory late payment rates.

[Alpha]

True - but I suspect that the debt is not a debt until it is billed - and so the "debt" is within time.

True and as the debt didn't arise until invoiced he can only charge interest at statutory rates following the end of his standard terms from the invoice date (unless he has it in his original terms that he can charge more)

Edit

Sorry Jaydee took me so long to finish that you have already covers much of what I said!!

[selfeax]

not sure what the legal position is on this but could it be the case that the debt would have been created at the point where an agreement for services was made i.e at the beginning of the relationship thus covered by the 7 year rule?

Sorry Alan - looks like you've answered my question. I must type faster!

[Alpha]

not sure what the legal position is on this but could it be the case that the debt would have been created at the point where an agreement for services was made i.e at the beginning of the relationship thus covered by the 7 year rule?

A debt can only crystalise when the individual is informed of the debt. If the accountant didn't invoice for 10 years that is his choice the debt begins from the date of invoice.

[Alpha]

not sure what the legal position is on this but could it be the case that the debt would have been created at the point where an agreement for services was made i.e at the beginning of the relationship thus covered by the 7 year rule?

Sorry Alan - looks like you've answered my question. I must type faster!

Yep and I answered your question whilst you was adding the edit:D:D

[Geoff T]

hello everyone i need advice.my accountant has just sent me a bill,this is the first bill he has sent me in 10 years.it is for 9 years of doing my accounts.he wants paid now ,i cannot pay this bill at the present time but have offered to pay by installments over 12 months.if i pay him this way he says he will charge 16% interest.he said on the bill it was his fault(i take some of the blame as well). what should i do.is it right he should charge me interest.

Throdge [kidding here guys!:D] PLEASE PM the accountants details OMG does he need me!...or GRD...or SOMEONE!!!!:eek:;):p

regards
Geoff

[David Griffiths]

I'm not at all sure that the debt only arises when it's billed - it would be worth taking legal advice on that point, perhaps initially from Citizens Advice, but they may not get involved if it's a business matter. It might be worth posting this point in the legal section of this site.

The key thing is not to acknowledge the debt in writing - that will extend any statutory limitation period.

Ask for a copy of the letter of engagement that you should have been given at the start. The accountant cannot impose any terms that have not been notified to you before the contract was entered into. I'm guessing that he didn't send you any terms and conditions - efficiency doesn't seem to be a strong point - so that will get you off the hook as far as that rate of interest is concerned.

It will be interesting to see your answers to Jaydees questions.

For the accountants on here, I've come across this before. I was approached by a local trader a few years back who was concerned about the self assessment deadline, some three weeks later. It turned out that the accountant (Chartered) had only done one set of accounts, and that was nine years before, and he hadn't sent ANY bills apart from a small one for the VAT registration. When we got the tax returns from the Revenue we found that he'd put round numbers in, based on the VAT records that the client had maintained. It wasn't far out, but I was amazed that the revenue had accepted this for so long.

He never did send a bill,and we turned round two years accounts in three weeks! Not bad in January, bearing in mind we had to work out the opening balance sheet from scratch. :cool: The client had pretty good records, fortunately!

[OldWelshGuy]

This could be a difficult one if it went to court. The stautory limit on debt is 7 years, if the company has not persued a debt for 7 years, they no longer have the right.

Here is the thing though, the company (accountant) chose not to persue the debt, so I would say that while some would argue that the debt only exists when the invoice is raised, the accountant has been negligent, so he would probably lose the right to recover the debt.

[Geoff T]

This could be a difficult one if it went to court. The stautory limit on debt is 7 years, if the company has not persued a debt for 7 years, they no longer have the right.

Here is the thing though, the company (accountant) chose not to persue the debt, so I would say that while some would argue that the debt only exists when the invoice is raised, the accountant has been negligent, so he would probably lose the right to recover the debt.

I'd have to agree, they're incompetence - their loss...Besides, someone that inefficient - do you want them doing your accounts?!?

it's definitely something I'd be happy to walk into court to argue....if it were me

[OldWelshGuy]

I am not sure you could actually claim this back as a legitimate expenditure, as the period covered would be outside the allowable accounting period. IE you are paying for a cost incurred in a 10 yr old tax year :(