Credit Checking Clients

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CJW
CJW Registered Posts: 10 New contributor 🐸
in General accounting discussion
Does / has other MIP's credit checked potential or current clients?

If so what services do you use to do so?



Thanks,

CJ

Comments

  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    No, never actually thought about it.
  • ASIM
    ASIM Registered Posts: 5 New contributor 🐸
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    We Use Creditsafe to check new clients it worth doing as some clients we used to get before had CCJ's ect and never used to pay up now depending on the seriousness of the CCJ's ECT we either turn them away or charge half of the monies up front. i would strongly recomend practices to use this as you know who your dealing with.
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
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    I always get clients to pay on account by monthly standing order before I do any work. That way you can be sure you at least have some money out of them before you start. I have a couple of clients who I didn't get signed up and invariably I have to spend time chasing them. I would dread to think how much time would be wasted if all my clients were purely on an invoice basis!
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    Perhaps it is geographical. I would on an invoice basis, with no problems. I do now ask for payment before I submit Tax Returns online, but I have had no problems at all.
  • System
    System Posts: 103,151 🤖 Admin 🤖
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    credit check

    It is very important to credit check new clients as you must know whether or not the customer will be able to pay off his/her debt. You don`t wan`t to be left with a lot of money being owed to you for any reason.

    You might find some useful hints on the website provided below. I think it`s worth visiting just to get an idea on how to deal with a potential client so that both sides are happy in the end.

    http://www.tak-outsourcing.com/pages/credit_limits
  • Poodle
    Poodle Registered Posts: 711 Epic contributor 🐘
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    From my experience and understanding ( I think that I am still up to date with this one), if you provide credit to individuls (not companies) where an arrangement has been set inplace to repay by more than 4 payments in a year then you must register for a license to provide credit, under the consumer credit rules. Approx £250 for a sole trader license and £550 for a company gives a five year license.

    Companies do not fall into these rules.

    If you want to register with one of the companies that provide credit history searches e.g. Experian, then you will have to provide your license details before they allow you to register even though you may only elect to search companies and be aware that each search costs.

    I get clients onto a monthly payment plan wherever possible, where I am in control of when I invoice my client against payments recived and services provided. This helps them and ensures that I have regular money to pay my bills as well.

    It is important for any business to have some sort of procedure in place for credit control and that includes accountants.

    I would not consider searching the credit history of a client as I feel confident that I am best positioned to review their 'ability' to pay me, either 'up-front' or on a payment plan, after all I have their bank statements, accounts etc, etc.

    Whether they want to pay me... well that's another issue and the risk that you take being in business.

    Poodle

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