Liquidation - accountant cost

[mgc]

Hi all - I have done a search but haven't found anything specifically for the accountant portion of the fee so apologies if I've missed posts elsewhere.

Having taken a permanant role I'm about to close my limited company using a voluntary liquidation. I plan to use MVL online to do this as they seem to have had good reviews on here (and they are almost 2k cheaper than the liquidator my accountant advises that I use).

However, my accountant has also quoted me ~£1200 for their part of the liquidation process. Having queried what this covers I'm still not clear how it can cost that much, and having spoken to MVL online they advised they needed fairly limited input from my accountant through the process.

Does anyone have any figures for the cost of this for just the accountant portion of the work that I can use as a comparison?

Thanks

[Clare@InTouch]

It entirely depends on what they are doing.

If it's a full set of accounts plus closure plus SATR then £1,200 sounds reasonable.

If you've been paying monthly and you're all up to date on that front then it sounds excessive. You should be looking at around £350 for the closure process in my view, which would include closing the PAYE, VAT and CT schemes, extending final accounts, advise on distributions etc.

[mgc]

Thanks Clare - I have been paying monthly and everything should be up to date, so sounds like I should look into getting somebody else to do it. It's a shame, my accountant started out really good but recently they seem to have started providing a fairly rubbish service and a highly inflated cost for everything.

[Maslins]

When they do the final accounts (if it's not already too late), get them to clean down the balance sheet. Specifically what I mean is:
- get rid of any fixed assets. Typically this means a laptop/mobile phone, which you (the director) can buy personally from the company...or possibly take for free if the equipment's a few years old so of negligible value.
- check you know what each debtor/liability on the balance sheet relates to. If there is a debtor, it'll probably be a final invoice owed to you by your client. There will quite often be creditors for VAT and corporation tax.

Following submission of final accounts, CT return and VAT return, pay the tax liabilities. None of this is out of the ordinary behaviour (ie any extra work for your accountant). Make sure you know what your various tax references are (corporation tax UTR, VAT registration number, employer's PAYE reference).

Hopefully your accountant will do all the above as part of their normal monthly fee that you've been paying them. At that point, there's nothing else they need to do, bar personal tax returns showing the distributions in a year or so. That's a quite separate task which you could potentially attempt to DIY, or most accounts will assist you with for perhaps a couple of hundred quid.

What specifically are they suggesting the £1,200 is for?

[eek]

What specifically are they suggesting the £1,200 is for?

They have to get their £1000+vat finders fee from somewhere.

[Maslins]

They have to get their £1000+vat finders fee from somewhere.

Well...yeah I was suspicious of that. Can't see them being keen to admit to it though, hence why I suggest putting them on the spot as to what it's for.

Also if they do all the things which should be fairly standard, you shouldn't need them for anything else, bar the personal tax return, which IMO it's fair enough that would be a separate charge...but one you could easily get another firm to assist with if you felt your current firm were ripping you off.

[mgc]

I did indeed ask for a breakdown of what the fee was for and the response was not that helpful. It apparently covers:

Annual accounts
Self assessment for 2013/2014 (fair enough)
Personal tax forecast
Company tax forecast
Deregistration with HMRC
Liaising with HMRC re tax refunds if any
Liaising with the liquidator
Other queries - apparently there are always lots of queries.

I think de-registration is just a couple of forms...? Tax refunds I would expect to be included within the monthly fee as any refunds from HMRC have been processed previously during my time with a limited company. Annual accounts - again, that would have been done although as it is only half way through my company year maybe they can justify a charge to compensate for the months I won't be paying them once the company closes (maybe).

Liaising with the liquidator/other queries - the liquidator informs me there shouldn't be many, if any at all.

Either way, not impressed. And they tried to hard sell on getting me to use their liquidator even stating that they would charge extra (on top of the £1200) if my liquidator asked them any questions that they would usually expect their preferred liquidator to deal with. Now I've told them specifically which liquidator I'm going to use I expect to be advised that as an online service it won't provide me what I need.

Anyway, rant over! Thanks everyone for your feedback on the detail of what's actually involved and for validating what I already thought.

[Maslins]

Hmmm...if there aren't any (non cash) balance sheet items, and all boxes have been ticked with HMRC, there shouldn't be any queries.

Having said that, if a query does come up which you can't answer, it's helpful to have the accountants on side. Often it'd be something they could answer in 5 mins, but if they refuse, can take us much longer attempting to figure out the missing info (or we have to make a guess which may be wrong).

Perhaps you could agree a "time spent" fee for any liquidator queries. That way hopefully it'd be £nil, but if they do need to offer some token assistance you should only get a trivial fee. Might also provide them with some comfort as they're perhaps concerned they'll end up doing tons of extra work to help us.

De-registration for VAT I'm confident you can do online from your HMRC portal login. Try to coincide it with a VAT quarter to make life easier.

For PAYE, if you've been paid any salaries in the current tax year, then I believe you just need to ensure the final RTI submission is marked as a final one. That shouldn't be any extra work for an accountant besides ticking a box.

I would perhaps sympathise that if you've dramatically shortened your company year, then that might justify a small extra charge (as they won't have received anywhere near 12 monthly payments since the last set).