Accountant taking advantage

[Bouta11]

Accountant has not invoiced me for years and now wants me to pay him? He was fully aware of my circumstances and he continued to do my accounts. I have told him I would do my own accounts and he said he would do them still. Now he wants me to pay him an invoice of £20,000 for his services? Where do I stand? Can he claim?

 

[justintime]

Presumably you gave him paperwork to do the accounts and permission for him to file?
Are you a Sole trader or Ltd Co?

 

[WaveJumper]

£20,000 how many years has he been doing them for, did he actually tell you he was going to do your accounts for free ?

 

[DWS]

Did you sign a letter of engagement, if so what does that say?

 

[Bouta11]

He has been our accountant for many years. We then fell into financial difficulty. He was fully aware of our circumstances. We always paid him however we couldn’t pay him for his services. Yet he still continued to do the accounts.
Jump forward, we were in an IVA. So there was no way we could pay him. We had one small business which he was doing the accounts for and still would do the accounts. We tried to leave him and do our own accounts on line and he was adamant that we didn’t. You could say because we were using him for so many years we just agreed with him.
Now he turns up, after we finish the Iva and asks us to pay him. I do t know where I stand. Do I need to pay him? He was fully aware of our situation. Why did he continue to do our accounts? What, to wait till we finished the Iva and sting us afterwards????!! It’s so distressing.

 

[Bouta11]

Ltd company.

 

[Bouta11]

Let’s assume we didn’t. What are the implications?

 

[Mr D]

He has been our accountant for many years. We then fell into financial difficulty. He was fully aware of our circumstances. We always paid him however we couldn’t pay him for his services. Yet he still continued to do the accounts.
Jump forward, we were in an IVA. So there was no way we could pay him. We had one small business which he was doing the accounts for and still would do the accounts. We tried to leave him and do our own accounts on line and he was adamant that we didn’t. You could say because we were using him for so many years we just agreed with him.
Now he turns up, after we finish the Iva and asks us to pay him. I do t know where I stand. Do I need to pay him? He was fully aware of our situation. Why did he continue to do our accounts? What, to wait till we finished the Iva and sting us afterwards????!! It’s so distressing.

Sorry, his debt wasn't part of the company IVA?
Why not?

If you wanted him to not do the accounts and he wanted to do them, the simplest thing would be not give him the details. Could have got someone else (or do yourself if you know enough as you say).

£20k debt is …. 10 to 20 years worth of accounts without payment?

Would be strange that they haven't chased before now, though I know of an accountant who waited 6 months before reminding the accounts needed paying for...

 

[WaveJumper]

I would be surprised if you never signed a letter of engagement, but that aside you have kept then on as accountants, supplying them with your books etc, was there any agreement to say they were not going to charge you or just an assumption on your behalf that because you were having hard times they would be acting for free. And why now after all this time are they presenting this invoice to you now are they assuming you now have the funds

 

[Bouta11]

Hindsight has shown it’s ugly head. We didn’t add him because he has been our accountant for so long. We have not come into any money. We are employed.
It’s just he knew our situation, why continue to charge, surely he of all people would know we can’t pay that sort of money back.

 

[Mr D]

Hindsight has shown it’s ugly head. We didn’t add him because he has been our accountant for so long. We have not come into any money. We are employed.
It’s just he knew our situation, why continue to charge, surely he of all people would know we can’t pay that sort of money back.

He knows you couldn't in the past. Choice for him appears to keep doing the work and not get paid, to chase payment to get paid, and cease doing the work.

So the choices appear limited.

Can you make arrangement for the company to pay the debt?

Does the debt make the company insolvent? If so its a good idea to speak to an insolvency practitioner for advice.

 

[Bouta11]

He also did our accounts for a business that we were down as sole traders. Does this mean he can demand payment still?

 

[Bouta11]

Well if we are to liquidate the company then so be it. But for some reason he is reluctant to pressure us into paying him back. He simply sent an invoice and said can we pay it. So we arranged a payment plan and we are paying it. But what I’m concerned with is do I need to pay it. Even though he wait for nearly 6 years to demand payment???

 

[Bouta11]

I would like to thank everyone for their comments so far. Great help guys. Thank you

 

[Mr D]

Well if we are to liquidate the company then so be it. But for some reason he is reluctant to pressure us into paying him back. He simply sent an invoice and said can we pay it. So we arranged a payment plan and we are paying it. But what I’m concerned with is do I need to pay it. Even though he wait for nearly 6 years to demand payment???

£20k in 6 years?
Good grief, I paid under £6k in 6 years.

 

[Mr D]

He also did our accounts for a business that we were down as sole traders. Does this mean he can demand payment still?

The sole trader business is him doing your accounts and you owe him for that.
The limited company business is him doing the limited company accounts and the company owes him for that.

 

[DWS]

Did he include his fees in your annual accounts?

 

[Mr D]

Well if we are to liquidate the company then so be it. But for some reason he is reluctant to pressure us into paying him back. He simply sent an invoice and said can we pay it. So we arranged a payment plan and we are paying it. But what I’m concerned with is do I need to pay it. Even though he wait for nearly 6 years to demand payment???

He did the work for you. Why would you think you should not pay it?

 

[Lisa Thomas]

Any debt you ow him personally would have been washed through the IVA. Assuming it was successful then he cannot pursue you personally for that.

As regards the Ltd Company it depends on what was agreed as to whether he has a valid debt that he can pursue the Company for.

 

[billybob99]

Just ignore him. He isn't getting a penny, you know that, I know that.

Sounds like he is in need of some cash himself so has just thrown an invoice at you.

Maybe he should wind his business down as well.

 

[WaveJumper]

Well if we are to liquidate the company then so be it. But for some reason he is reluctant to pressure us into paying him back. He simply sent an invoice and said can we pay it. So we arranged a payment plan and we are paying it. But what I’m concerned with is do I need to pay it. Even though he wait for nearly 6 years to demand payment???

It sounds like they have already started re-paying

 

[ComPropSolicitor]

Kind of difficult to ask / argue the point of the legitimacy of a debt when you have already started paying it - Its not the first thing people do when they are disputing a debt. Not really sure where that leaves you to be honest.

If you cancel the payment plan now - he will just say you have accepted its legitimacy via way of your part payment of it and try and take action to recover the balance.

 

[Lisa Thomas]

We do only have one side of the story.

 

[Mr D]

Firstly I am happy to pay employees what they are worth, but who decides what they are worth? Because I'm sure you would go around thinking you are worth a lot - the employer on the other hand might beg to differ.

Secondly this accountant in question hasn't invoiced for several years and suddenly sends an invoice - unless that is normal in your industry, something isn't quite right there.

Government decides a minimum for employees.
And the employee is usually the one deciding what they are worth beyond that. If you offer a job at £12 an hour and I consider myself worth £20 an hour for that work I won't be bothering to apply.
If you then get no decent applicants for that job then perhaps you undervalued what the employees you need are worth...

Seen it happen multiple times in companies - cheap management try getting staff as cheap as possible and the only ones applying are the desperate and the ones forced by the jobcentre, not the professionals or those with the necessary experience.

 

[kulture]

I have removed the employee posts. It is not acceptable that a rant from another thread spills over into this one. Please be more respectful