Deposits from New Clients

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monkeypuzzle47
monkeypuzzle47 Registered Posts: 134 Dedicated contributor 🦉
in General accounting discussion
I take on alot of new clients this time of year. It takes alot of my precious time, to take details, initial consultation, sending out letters of engagement etc. etc. I would say 20% of these clients fail to follow through and send in their accounts therefore, I am thinking to charge some sort of deposit up front, to deter this from happening. Does anyone do this sort of thing? If so what sort of amount should I charge etc. Im not entirely sure if I can do this.

Usually I do not charge the client until I have completed their accounts and then they have 30 days to pay. Sometimes they take advantage of 60 days!!

Advice appreciated. Thanks.

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  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    I don't have any initial problems with clients. I don't take a deposit, but what I do is send out the paperwork for signing once everything is complete and ask for payment with the return of the signed documents. In that way I get my payment before the accounts and tax returns are finalised. It works for me, but it does depend on the type of client you are dealing with.
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    Bill monthly. As soon as they have signed the engagement letter, send them an invoice, and get them to pay by monthly standing order. The fees are non-refundable as you are acting for them every month, it's just some months you will have more to do than others.

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