To accountants out there

Yep, I know what you mean. It's like when you get a new client who's done his own tax returns in the past, but claimed for all sorts that he shouldn't have done. It's all down to the last decade or so where HMRC have been asleep on the job - in the 80s and 90s there were far more enquiries and they'd pick up on a lot more through just casting a critical eye on the return. There is also a loss of local knowledge now that tax offices are centralised - I remember an tax inspector in our town centre tax office who really "knew" the businesses in our town - he'd watch for new start-ups and check they'd registered etc. Now, if your tax return manages to stay under HMRC's radar, let's face it, you can probably get away with anything!

FWIW, I'm as straight as an arrow and if my accountant "suggested" that I how shall we say, manipulated the books, then I'd be off like a shot.

I think that on the main, most people are straight...will get away with what they can but won't take liberties.

Mister B

I can't say I've come across this a lot.
Most clients have respected my opinion when I've told them (and I make sure I explain it, not just fob them off) what they can and can't claim. They are paying a professional for a professional opinion and that's what they get.

I make sure they are aware of the potential consequences of lying, sorry, being creative, and once I explain this they are usually happy with doing the right thing.

If they want me to fiddle the facts, they can shop elsewhere.

I will always act in the best interests of my client, not the tax man, and love playing within the rules to my client's greatest advantage. But breaking the rules doesn't happen.

Maslins said:

I was having a chat with a potential client today, and they told me how brilliant their current accountant was because he called what was blatantly "client entertaining" "business development", thus magically making it allowable for tax.

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What did your MLNO think about that?

Maslins said:

Do any of you have problems with other accountants being better at saving tax by simply renaming certain expenses.

I was having a chat with a potential client today, and they told me how brilliant their current accountant was because he called what was blatantly "client entertaining" "business development", thus magically making it allowable for tax. The frustrating thing was there was no element of nudge nudge wink wink from the client, they genuinely thought this was their accountant's excellent knowledge.

I fairly recently left a big practice, where obviously they would not do anything like this as the risk of loss to reputaion was so large, but I've now setup effectively on my own, and I'm concerned that I'm considered worse than my competitors, basically because I'm not prepared to lie on the client's behalf.

I do understand where the clients are coming from, as obviously most returns go through without an enquiry and they get away with it, so my suggestion to them of "yeah, it may save you money, but it's not right" doesn't spark much interest!

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I do understand where you are coming from having worked and trained in a variety of practices large and small.

It is a bit of an eye-opener working at the smaller end of the market.

Bear in mind sometimes some of the stories you will hear are just that stories often very big ones! Its on par with the infamous line ''but the guy I met in the pub said...''

In the long term you wont do yourself, or your clients any favours by not doing everything by the book just as you would have done as an employee.

If with your old accountant, you paid no tax, took as much out the company as you liked with cars, phones and company jet skis, never had an investigation or compliance review AND only paid £500 a year for it then why the bloody hell are you in my office?

Zeno said:

If with your old accountant, you paid no tax, took as much out the company as you liked with cars, phones and company jet skis, never had an investigation or compliance review AND only paid £500 a year for it then why the bloody hell are you in my office?

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Exactly!! Very well said.

Zeno said:

If with your old accountant, you paid no tax, took as much out the company as you liked with cars, phones and company jet skis, never had an investigation or compliance review AND only paid £500 a year for it then why the bloody hell are you in my office?

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Probably because the old accountant now wants to do things properly

Maslins said:

Do any of you have problems with other accountants being better at saving tax by simply renaming certain expenses.

I was having a chat with a potential client today, and they told me how brilliant their current accountant was because he called what was blatantly "client entertaining" "business development", thus magically making it allowable for tax. The frustrating thing was there was no element of nudge nudge wink wink from the client, they genuinely thought this was their accountant's excellent knowledge.

I fairly recently left a big practice, where obviously they would not do anything like this as the risk of loss to reputaion was so large, but I've now setup effectively on my own, and I'm concerned that I'm considered worse than my competitors, basically because I'm not prepared to lie on the client's behalf.

I do understand where the clients are coming from, as obviously most returns go through without an enquiry and they get away with it, so my suggestion to them of "yeah, it may save you money, but it's not right" doesn't spark much interest!

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This made me smile. If a potential client said this to me, I would point out that although it sounded very clever, if the HMRC ever picked on her to check her records - the title business development would make them ask questions and query it! I certainly would if one of my clients tried it!

I recently took on a client who also thought her previous accountant saved her a little more tax, than from when she did it herself. But it was just making sure that she did claim all the allowable things. However recently she told me I had saved her more. But that was only because I insist clients send me all their records if it involves the business. So if they use their personal credit card, I want to see the statements, not just the receipts. I noticed she was paying for PPI, which I suggested she should try to reclaim due to the fact she was self-employed so was unlikely to receive any benefit from it. I gave her the internet link for the FSA so she was able to check the facts about it for herself and find out what to do. I also try to encourage clients to keep their records up to date, and speak to them (free of charge) at least once during the trading year to see how they are getting on. If they are struggling, I suggest they go to the HMRC website and look into if they could claim Working or Family Tax credit if they have not already done so. It doesn't take much time (5-15 minutes), during a quiet period, and it makes them feel they are getting extra value for money.

I am always surprised when I have a new 40% taxpayer client from another accountant, I find the one thing they seem to forget to find out about is Gift Aid. I have saved a surprisingly large number of clients quite a bit of tax, simply because I have checked if they make charitable contributions under Gift Aid.

As the saying goes: Sometimes its the little things that make all the difference.

There are plenty of legal things we can help with, why waste time on the ones that aren't.

Maslins said:

Do any of you have problems with other accountants being better at saving tax by simply renaming certain expenses.

I was having a chat with a potential client today, and they told me how brilliant their current accountant was because he called what was blatantly "client entertaining" "business development", thus magically making it allowable for tax. The frustrating thing was there was no element of nudge nudge wink wink from the client, they genuinely thought this was their accountant's excellent knowledge.

I fairly recently left a big practice, where obviously they would not do anything like this as the risk of loss to reputaion was so large, but I've now setup effectively on my own, and I'm concerned that I'm considered worse than my competitors, basically because I'm not prepared to lie on the client's behalf.

I do understand where the clients are coming from, as obviously most returns go through without an enquiry and they get away with it, so my suggestion to them of "yeah, it may save you money, but it's not right" doesn't spark much interest!

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If his accountant is so brilliant, why is he talking to you?