VAT flat rate scheme - mess up
Rachel
Registered Posts: 348 Dedicated contributor 🦉
I have messed up big time and feel awful.
I have calculated flat rate percentage on net sales rather than gross. I can't believe I have misunderstood so badly. I have come clean to both my clients that the affects the moment I found out my mistake. Neither is over £3500 but I feel that I have badly let them down.
I am glad I have PI just in case.
How do I come back from this.
I have calculated flat rate percentage on net sales rather than gross. I can't believe I have misunderstood so badly. I have come clean to both my clients that the affects the moment I found out my mistake. Neither is over £3500 but I feel that I have badly let them down.
I am glad I have PI just in case.
How do I come back from this.
0
Comments
-
Firstly tell your client of your mistake and then write to HMRC and explain the error. Explain the change in payment due to the client and apologise. You are only human. If they are a good client they will understand. Afterall you are not asking for extra money to be paid to HMRC, just the correct amount. I would suggest that you do not ask for payment for the invoice which relates to this. I am sure it will work out fine. Don't worry!0
-
I contacted both my clients last night but haven't heard back. I have told them I will sort out the correction if they still want me to act on VAT for them and have no intention of charging.
I am just a small business working evenings as I have 2 small children and now feel that I have let myself down badly.0 -
We've all made mistakes, it happens! Just recently someone posted about putting in credit notes as invoices, silly mistake but it just happens!!! I have a stupid habit of reading the wrong line on the VAT return and telling the client the wrong liability - that came back to bite me once!!!
When I have flat rate scheme clients I print out the rules of the scheme and have them in the file (especially the turnover limit) as a reminder although something tells me you will never make that mistake again.
I always think that at least I'm not a doctor, any mistake I make only involves money which can be put right financially via PI insurance.
The only way to recover is to work out a safeguard so it doesn't happen again.
Chin up!0 -
I know it feels awful when things like this happen but try not to worry too much.
You can just correct this error on the next return, though a written voluntary disclosure and additional payment of the balance of the correct amount would be advisable.
As TC says, don't charge for this one (unless you had to do hours of bookkeeping first, in which case give a decent discount) and just put it right. All you can do is say sorry and put it right and if they are decent clients they will give you the benefit of the doubt and keep you on. Don't say sorry too profusely though, keep it professional not grovelly!0 -
Thanks for your kind responses. I am waiting to hear back from the clients, One I think will be fine the other I am not so sure about.
That and P11D's argh0 -
had one response back saying " don't be so hard on yourself, mistakes are made, please continue to file my returns and sort out error form"
That was the one that i thought would be understanding just waiting on the other one.
i feel half better now0 -
had one response back saying " don't be so hard on yourself, mistakes are made, please continue to file my returns and sort out error form"
That was the one that i thought would be understanding just waiting on the other one.
i feel half better now0 -
Well it has been an awful day but both clients affected are ok about it.
At least I spotted it and not an inspector. Will correct and will never make this mistake again!
Another hard lesson learnt.0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 324 NEW! Qualifications 2022
- 160 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 94 AAT Level 4 Diploma in Professional Accounting
- 8.8K For accounting professionals
- 23 coronavirus (Covid-19)
- 273 VAT
- 92 Software
- 274 Tax
- 138 Bookkeeping
- 7.2K General accounting discussion
- 201 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership