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Unpaid purchase invoices

  • 09-11-2014 4:42pm
    #1
    Teaandcoffee
    Registered Users Posts: 94 ✭✭


    My accountant stumbled across an unpaid purchase invoice from 2013. That I claimed the vat on and in lieu received a large payment from revenue.

    My accountant is pressurizing me to return the refund I received. Problem is I don't have the money. He has told revenue about the outstanding invoice and now they are coming out to review me.

    My supplier who is fully aware of my circumstances knows of my excellent payment history and has stretched the due date out on the invoice.

    My questions are what happens if I cannot return the vat reclaimed? Will I be forced to sell my home or will the revenue sheriff come to my home.

    Because the invoice is from late 2013 and the supplier has changed the payment terms and conditions am I protected from having to repay revenue until I pass the purchase invoice due date has passed?

    Thanks in advance.


Comments

  • #2
    Alan Shore
    Registered Users Posts: 735 ✭✭✭Alan Shore


    Teaandcoffee wrote: »

    My accountant is pressurizing me to return the refund I received. Problem is I don't have the money. He has told revenue about the outstanding invoice and now they are coming out to review me.

    You need to expand on this, what do you mean he has told the Revenue?

    There is a provision in the 2014 Act that says that the VAT on any invoice not paid within 3 bi monthly VAT periods should be paid back. But it's not retrospective into 2013.


  • #3
    Teaandcoffee
    Registered Users Posts: 94 ✭✭Teaandcoffee


    Thank you Alan for taking the time to respond.

    My business will be over if I am made liable for the vat refund that I received but I will give you more background on what has gone on.

    I purchased services in late 2013 but I was unable to meet the debt at the time. My provider has facilitated me and we have amicably agreed a date that I repay the debt due.

    My accountant stumbled across this unpaid invoice while returning my income tax for 2013. He contacted the supplier of the invoice , they told him it wasn't paid and informed him they ran a cash accounting system and would not be returning the vat element on the invoice until they received payment from me.

    My accountant is not happy with any of this and wants me to return the refund to Revenue. He has also informed Revenue of the unpaid invoice from 2013 but they have not asked me to return the vat element but I have been informed that I am currently under a review.


  • #4
    smcgiff
    Closed Accounts Posts: 5,943 ✭✭✭smcgiff


    Teaandcoffee wrote: »

    My accountant is not happy with any of this and wants me to return the refund to Revenue. He has also informed Revenue of the unpaid invoice from 2013 but they have not asked me to return the vat element but I have been informed that I am currently under a review.

    This is VERY strange. The accountant doesn't work for Revenue and should not pressure you into anything. He should advise, and document his advice to protect himself.

    What is beyond weird is that he blew the whistle on you. Do you owe him money? Not that that would excuse his behaviour, but it would at least explain it.


  • #5
    Bogger77
    Registered Users Posts: 1,857 ✭✭✭Bogger77


    you need a new accountant, one that's working for you.

    s/he's basically signed you up for a tax review/audit


  • #6
    Teaandcoffee
    Registered Users Posts: 94 ✭✭Teaandcoffee


    Smcgiff, thank you for your response. The situation is very bizarre. My returns are not the same as what he is filing for me and this is going to cause untold problems. This morning I actually showed him a copy of this thread as proof that the law was different in 2013 i.e. Alan Shore's post. He still will not change his mind. I am refusing to sign off my accounts on these grounds.

    All bills I ever had with him are paid.


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  • #7
    [Deleted User]
    Posts: 5,121 ✭✭✭ [Deleted User]


    Teaandcoffee wrote: »
    My returns are not the same as what he is filing for me and this is going to cause untold problems.
    Why is this? Your situation does seem to be complicated.


  • #8
    Teaandcoffee
    Registered Users Posts: 94 ✭✭Teaandcoffee


    Bogger77 wrote: »
    you need a new accountant, one that's working for you.

    s/he's basically signed you up for a tax review/audit

    Hi Bogger77, yep I've just been landed smack, bang in the middle of a review. The review is in December. Do you believe that if I answer all questions that has been put to me by Revenue and forward them my accounts that they will suspend the review considering that I have been more than upfront with information I have provided them with? Will Rev. insist this money be returned considering the due date has been extended?

    Hi pg633, my situation is not too complicated. The only issue that is raising a concern is the unpaid purchase invoice from 2013. The accountant is dismissing this invoice and insisting I return the vat I claimed from it, hence on my returns he is not recognizing this invoice, it as he keeps insisting I did not pay for the services so I should not have gotten the refund. He also thinks the supplier and my relationship is too close for comfort i.e I know the guy pretty well and he has had me do odd jobs around his house which I have always returned the vat on but still he thinks our relations are too close for comfort.

    I forgot to add that I believe his practice are made up of all ex revenue. Trust me to pick 'em, eh . . .


  • #9
    dbran
    Moderators, Business & Finance Moderators Posts: 2,094 Mod ✭✭✭✭dbran


    Are they properly qualified accountants? Seems very odd advice and they should not be filing returns you have not signed off and agreed on. That's a serious no no.


  • #10
    [Deleted User]
    Posts: 5,121 ✭✭✭ [Deleted User]


    http://touch.boards.ie/thread/2057318356/1
    http://touch.boards.ie/thread/2057131039/1
    http://touch.boards.ie/thread/2057191536/1

    OP going by your other posts you seem to be doing alot of the work yourself and you have already come to revenues attention.

    I don't blame your adviser for being concerned.

    When are you going to settle this invoice?
    I don't know alot about VAT but to me it looks like you are using this amount as working capital to keep your business going, and your accountant is concerned about this and whether you will actually be able to pay this back to revenue or to the supplier.

    You say in the OP that you don't have the money - where has it gone? You haven't paid your supplier. It was never your own money - it was and remains the state's money.


  • #11
    smcgiff
    Closed Accounts Posts: 5,943 ✭✭✭smcgiff


    Are you in any way connected to the Supplier that raised the invoice that you claimed the VAT on?

    You run a small business, but claimed a large refund from Revenue - how much are we talking about?

    Did your accountant file the return for you? If so he might feel he is obliged to get this corrected.

    From your other posts it seems you've already had a Revenue Audit - how did that go?

    It does seem like Revenue has funded your business. There may also be implications for your supplier. It depends on the size of the invoice, but he might get a call to his door also.

    Also, I'm surprised the accountant has not walked away.


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  • #12
    dbran
    Moderators, Business & Finance Moderators Posts: 2,094 Mod ✭✭✭✭dbran


    Didnt notice or realise that you were already in a revenue audit situation due to what you have sent into revenue yourself.

    There is always two sides to the story.

    dbran


  • #13
    Sunny Dayz
    Registered Users Posts: 5,301 ✭✭✭Sunny Dayz


    http://www.revenue.ie/en/practitioner/ebrief/2014/no-552014.html


    Hopefully you can view the above link. It is an e-brief issued from Revenue stating that it relates to VAT deducted since 1st Jan 2014. So an outstanding purchase invoice from 2013 wouldn't come under this remit.
    Was the invoice issued to you in advance ie billed in Dec 2013 for services to be provided for in 2014?


    Also from the e-brief:
    In exceptional circumstances, where there are genuine commercial reasons for not having paid the consideration and Revenue are satisfied with these reasons, no adjustment is required.


  • #14
    Teaandcoffee
    Registered Users Posts: 94 ✭✭Teaandcoffee


    Hi guys,

    Sorry only getting back now.

    I met with a new accountant within my area and left him with a copy of my books. He said he would review my position and to come back in a day or two.

    Summary of meeting:

    1. I have a liability of 4k for 2014. Don't have it so a payment plan to pay it off can be set up.

    2. My current accountant has a slightly colorful past with regard to a previous business partner i.e. signing off on dodgy stuff. Looks like he is trying to score brownie points with the big boys etc. and it seems like more of his clients will be looking at a review.

    3. What I perceived to be an audit was in fact a desk top audit or something along those lines but there was no issues and I was granted a refund.

    4. My books are deemed in good order as the new accountant who reviewed them said he was expecting them to be catastrophic so was bemused when they were in good nick.

    5. New accountant said I would have to remove current accountant for him to formally act on my behalf.

    6. He thinks accountants bill is slightly excessive. Anybody any idea the cost of accounting income tax for a a very small business?

    7. He was dismayed by all the information I had provided the rev with since I was notified of the review. Full set of accounts etc. List of my suppliers, customers etc. Is there any chance the review will be postponed because of my full compliance?

    Sunny Dayz, thank you for the link. To answer your question the services were rendered mid to late 2013 and I was invoiced in late 2013. The only issue is I invoiced my customer for work I did along with the services I purchased from the supplier in 2014. New accountant believes this should not be an issue as I purchased services in 2013????


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