Unpaid fees

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Wonderwoman
Wonderwoman Registered Posts: 6 New contributor 🐸
in General accounting discussion
Do other members in practice think it unprofessional to advise clients that Tax Returns wont be submitted until fees are paid.

I have several clients for whom I have prepared accounts and tax returns but they havent paid

Anybody else having similar problems?????

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  • slackda
    slackda Registered Posts: 460 Dedicated contributor 🦉
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    I put in my letters of engagement, you pay up or no numbers(not actually that blunt).....but thats my opinion

    If you havn't got a letter of engagement then you might have a problem.

    But after all the fine ends up on thier desk not yours so there is a real incentive for them to pay you....obviously if the client is suffering from poor cash flow exeptions can be made.

    Maybe a good approach would be 50% before submittal and 50% after?

    so no i don;t think it is unprofessional providing you comunicate with the client.
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    No problem with payments generally, but I now ask for payment with return of signed paperwork before tax return submission. Most are happy with that. It does depend on the type of clients you are dealing with though!
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    I had this with a problem client a year ago.
    We spoke to a solicitor who said "If you don't file the return, they can argue you haven't completed the service for which they contracted you, therefore are entitled to withhold payment."

    We now take 50% up front on receipt of papers, and don't start work til this is paid, with the balance on completion and this works fine.

    You are probably creating negative goodwill if you refuse to submit a return before being paid and potential problems as above if it goes legal (unless your terms say they are paying you for preparing the info and you separate out the submission but this is a bit pernickety).

    Effective credit control really is the key, also not being afraid to say No to clients who you know may be a problem. Once you've written off 4 figures in bad debt, you stop playing Mr Nice Guy! People are paying slower this year, but keep the pressure up. The squeaky wheel gets the grease.

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