VAT Flat rate blunder by my accountants

**xoggoth** · 4 March 2009, 22:19

I believe they may only refuse repayment after a longer (6 year?) period or where you in turn have overcharged clients and are likely to just pocket the refund. It's called "unjust enrichment". Never used flat rate but can't see how that can apply to a contractor anyway, don't you just charge all clients the normal standard rate? That's correct for the service you provide. Their advisors often have little idea what they are doing so I would pursue it further.

**contractor79** · 4 March 2009, 23:10

huh?

**Archangel** · 5 March 2009, 08:52

Zog clearly does not understand FRS.

I'm sorry though, I don't know the answer to your question. Does your new accountant not have a view?

**BrilloPad** · 5 March 2009, 08:54

Interestingly I am paying too little FRS......

**BrowneIssue** · 5 March 2009, 09:07

Originally posted by contractor79 View Post

My previous accountants put me on an incorrect flat rate category ...

HMRC have advised me that they will not retrospectively reimburse me for the additional taxation that I've paid (no surprises there, one way traffic as usual)

Can I sue my accountant? Are HMRC telling fibs?

I am disappointed with the response you got from HMRC. The VAT people (Customs & Excise) used to be fair and the Inland Revenue unfair; the former behaviour seems to be getting scarce since their merger.

Regarding the accountant, yes you can seek recompense. Ask them for compensation in writing. If that goes nowhere, are they chartered? If so, threaten to complain to their professional body (determine that from the letters after the accountant's name). If that does not work, actually complain to their professional body. You can ask your new accountant to assist you in this.

If you can show the accountant cocked up despite you giving them correct information, you should be able to get some form of compensation.

NB when I say 'you' I do of course mean 'your ltdco'.

**krytonsheep** · 5 March 2009, 09:23

If you look at the HMRC FRS notes under 'What if I get the sector wrong?' it just says...

We will not normally check your choice of sector when we process your application. So if you have made a mistake you may pay too much tax or too little. Paying too little could mean that you are faced with an unexpected VAT bill at a later date.

It doesn't say what happens if you pay too much, but I would imagine this would be seen as a VAT error, and your new accountants can adjust for this on your next VAT return (that's just a guess though).

**Tax Lord** · 5 March 2009, 10:07

Originally posted by contractor79 View Post

My previous accountants put me on an incorrect flat rate category meaning I paid a higher rate than I should have for 2 whole years, it's only now my new accountants spotted this error and this error has cost me many thousands of pounds.

HMRC have advised me that they will not retrospectively reimburse me for the additional taxation that I've paid (no surprises there, one way traffic as usual)

Can I sue my accountant? Are HMRC telling fibs?

It depends on the amount you have over paid. You/your accountant should calculate your vat in the normal manner for the next quarter, deduct the over payment and pay the difference. Also include a covering letter as to why you have done this.

**contractor79** · 5 March 2009, 13:00

I shall appeal to them about this unjust approach. Had I paid too little no doubt they'd be after me very aggressively, demanding payments, fines, interest.... heck they even do that when I HAVE paid my tax, so incompetent they are

**Robot** · 5 March 2009, 16:09

Originally posted by contractor79 View Post

My previous accountants put me on an incorrect flat rate category meaning I paid a higher rate than I should have for 2 whole years, it's only now my new accountants spotted this error and this error has cost me many thousands of pounds.

HMRC have advised me that they will not retrospectively reimburse me for the additional taxation that I've paid (no surprises there, one way traffic as usual)

Can I sue my accountant? Are HMRC telling fibs?

RE - Can I sue my accountant?

Who signed the flat rate application form, you or the accountant? If you, I think you stand very little chance of suing your former accountant.

VAT Flat rate blunder by my accountants