Is my accountant overcharging me?

EyeOnTheBall

I have used an accountant (for the 1st time) to calculate my tax for year ended. All the books were presented in an organised condition with purchase/sales breakdowns. Cheque reconcilliations, VAT3, expenses and pretty much everything shown in MS Excel breakdowns.

The books were so organised he didn't ask for any further documentation etc.....yet.....the bill has just come in.....it's €1,400.00!

Is this too much to pay? I am only a sole-trader and not a limited company. Please advise.

Thanks

TheInquisitor

Ask for a discount. Accountants always start at a higher figure. The view is he might want 1200 puts bill at 1400 then you ask for discount he gives you 200 off you feel like a winner cause of a discount and he gets the price he wanted anyway. Always complain about the price. Is it your first year trading? What is the turnover? I doubt'd get a bill for less than 1000 anywhere.

EyeOnTheBall

I like the sound of that. I'll call him and see if he'll do a discount. I should have mentioned that the €1400 was inc VAT @ 21.5%.

It's a shocking fee all the same, especially since he knows that money's a bit tight at the moment. My turnover was not great last year. Also, it's my 1st year trading so I don't have anything to pay.

So you reckon €1,000 is the average rate?

Bam33

I do accounts/tax for some friends and if you have provided him with everything and he is just doing your tax it should cost much less than €1000 - if it is just once a year he does this for you it shoud only be around the €500 mark IMO

PCPhoto

ask for a discount..... then look for a cheaper accountant..... i give all receipts to my accountant and I get charged €1K (what I give is unorganised boxes of paper so I'm getting a great service IMO)

jakestevens81

1400 including vat seems alot if all he does is your end accounts, I work as an accountant, and sometimes people do give out about their bill, but you have to look at what all the accountant does for you during the year. Also don't always look at the cheapest accountant, have a meeting with a few accountants, and pick the one which suits your needs most. Cheap isnt always best option.

TheInquisitor

EyeOnTheBall wrote: »

I like the sound of that. I'll call him and see if he'll do a discount. I should have mentioned that the €1400 was inc VAT @ 21.5%.

It's a shocking fee all the same, especially since he knows that money's a bit tight at the moment. My turnover was not great last year. Also, it's my 1st year trading so I don't have anything to pay.

So you reckon €1,000 is the average rate?

Did the accountant help you in setting up the company as in getting the name for the company e.g send in your information to the company registration office? There might have been extra costs such as this associated with your company because it is the first year of trading... Did you talk or have many meetings with your accountant? All these things add up unfortunately...

Ask him for a discount anyway. If money is tight then he will have seen that from the bank statements and sure you can always treaten to leave In these times every client counts !! Good luck

EyeOnTheBall

TheInquisitor wrote: »

Did the accountant help you in setting up the company as in getting the name for the company e.g send in your information to the company registration office? There might have been extra costs such as this associated with your company because it is the first year of trading... Did you talk or have many meetings with your accountant? All these things add up unfortunately...

Ask him for a discount anyway. If money is tight then he will have seen that from the bank statements and sure you can always treaten to leave In these times every client counts !! Good luck

No! I set up the company myself. I did everything. All he did was receive an orderly set of accounts, I have no employees, no payroll etc. He never once gave me any advice on how to manage my accounts, I did that myself. I have never received any direction from him i.e. what to do with my money. I have not even met him (!) I sent everything on line to him in MS Excel and scanned and emailed all bank statements, VAT3 etc.

A 'friend' recommended him (hmmmm)

Bottom line. He just calculated what I owed. Nothing more than that.

I'm really beginning to think I've been stung.

EyeOnTheBall

jakestevens81 wrote: »

1400 including vat seems alot if all he does is your end accounts, I work as an accountant, and sometimes people do give out about their bill, but you have to look at what all the accountant does for you during the year. Also don't always look at the cheapest accountant, have a meeting with a few accountants, and pick the one which suits your needs most. Cheap isnt always best option.

Thanks. Can I ask you, as an accountant, what would you consider a 'reasonable' fee for simply calculating the end of year figure for a sole-trader (no employees) ? Nothing else.

EyeOnTheBall

PCPhoto wrote: »

ask for a discount..... then look for a cheaper accountant..... i give all receipts to my accountant and I get charged €1K (what I give is unorganised boxes of paper so I'm getting a great service IMO)

Really!??.....I'm suddenly feeling like a sucker.
Thanks

Justintime

I am an accountant and work in the big 4. I appreciate that you are only in your first year and that as you put it 'he only calculated my tax bill' but you have to consider that there is a necessity to prepare a set of accounts and then the tax is calculated. Many people do 'nixers' and can charge the 500 mentioned in a previous post but you're up the swanny when you go looking for finance and you can't produce a certified copy of your annual accounts. To be fair, IMO, 1,400 Vat inclusive is not bad!

jimmyskank

First year trading for €1,400, seems reasonable, Just keep in mind that there was Tax Registration and maybe business name registration involved. Also the first year of trading may involve two tax returns. What was the breakdown of the costs. having worked in an accounting firm many years ago things haven't changed, the client still says "sure I had everything ready for the accountant."

The_Hustler

Where I work, we write a description of all the work we did for the client when sending out our bills so that they can see what we're charging for. Maybe ask him what he did.

Bam33

1400 is excessive - I also work in big 4. They do not need a full set of audited accounts to get finance. Many of my friends have gotten finance with the accounts I prepare and many only need to prove they are up to date with their tax returns.

Eye on the ball - I think you are being stung. All they had to do was verify your work (you sound pretty organised) and calculate your tax (they probably even have a package to do this for them). 1400 is far too much.

Justintime

Bam33, I assume when you do the financials for your mates that you are relying on your own practicing certificate and as such you are paying the Institute the annual fee that goes with that. I aslo assume that you are paying your annual professional indemnity premium and that your office exps etc.. are going to be covered by the €500 (vat inclusive) revenue that this kind of work is going to generate for you!

Bam33

Justintime - assume away. What I do/pay/receive is nothing to do with you and has nothing to do with the OPs question OP is asking if 1400 is too expensive. You think perhaps its not. I think it is.

dbran

Bam33

Curious as to what accounting package you refer to.

Any one I have used I have to check it because it always calculates the tax wrong.

DB

EyeOnTheBall

jimmyskank wrote: »

First year trading for €1,400, seems reasonable, Just keep in mind that there was Tax Registration and maybe business name registration involved. Also the first year of trading may involve two tax returns. What was the breakdown of the costs. having worked in an accounting firm many years ago things haven't changed, the client still says "sure I had everything ready for the accountant."

I did all the tax reg and business reg myself. I'm still waiting on the actual bill breakdown. But seriously.....I really did have everything ready for the accountant.

EyeOnTheBall

Bam33 wrote: »

1400 is excessive - I also work in big 4. They do not need a full set of audited accounts to get finance. Many of my friends have gotten finance with the accounts I prepare and many only need to prove they are up to date with their tax returns.

Eye on the ball - I think you are being stung. All they had to do was verify your work (you sound pretty organised) and calculate your tax (they probably even have a package to do this for them). 1400 is far too much.

Thank you Bam. I have since bought a SAGE package and I am going to do my accounting on that to see if it makes next year's bill any lower.

Bam33

Eye on the ball the sage packages are quit good and very user friendly. You will easily get someone to complete your tax return for you cheap enough next year if you keep the sage side of it up to date.

Dixie Chick

Bam, most of our clients who decide to do sage/quickbooks themselves make a hash of it and we end up spending hours trying to see where figures come from.

Justintime was making the point that accountants have exepnses and although thier knowledge is free, providing it certainly isnt. So yes, I can do a nixer for 50 quid if I want but I am leaving myself open if I dont provide it under our practises cert.

crazzzzy

your accountant probably still did bank reconciliations, etc if everything you sent in was on excel. Had you alot of transactions over the year, capital allowances?

Arrange a meeting and ask for the breakdown of the costs if you don't already have them. It does seem a bit high if it was a simple set of accounts but you'll have to ask him why and if you're not happy change accountants.

cguil@eircom.ne

Hi
I have an accounttancy practice operating out of Dublin , Athlone and Galway...

if your interested ill do your accounts for half of this fee!

Mr Clonfadda

Hi OP

The most important thing to do is get quotes for everything. Ask for a price before you hand in books.

leitrim lad

i know it sounds a bit steep ,but what kinda turnover you on, i know my accountant charges me €1200 per company, let it be sole trader or limited, but they all turn over 7 -8 figures per year, and i have a girl in the office who i wouldnt part with for the world and she gets around 40k peryear, she runs the day to day things, wages,vat,monthly returnsand so on,

and my accountant is the best in the country, 2 months every year we pay revenue 35%, instead of using c2 ,leaving enough money with revenue from vat and 35% to cover their account for the year, so no money has to come from the wages or day to day spend to pay revenue,

i find him cheap because he is busy with all my dealings, but one thing i will tell you is when i started years ago i was a bit of a messer when it came to paper work, and i had an audit from revenue ,they infact owed me money, but imagine a superintendent from the gardai, asking you for receipts and proof of purchase and where the money came from in the first place, that would frighten anyone,
my point is your accountant is there to help you in situations like that, and mine thank fully leaves enough money with revenue every year ,to keep them off my back and i think the hassle of doing that is worth it,

but if you have a bad accountant and a small turn over say under 100k per year it should be about €600 plus vat for acounting fees

professore

Many of the supposed accountants on here they seem to have missed the inital point that the OP is a SOLE TRADER and therefore did not register with the CRO. OP, why not use ROS to calculate your bill ? You seem to have a good handle on things and are well organised.