Having read a few posts recently I wonder are all clients a little bit dishonest in one way or another.
I don't mean really dodgy,(although I think there are those too) I mean the pretty legal client, who tries to do most things by the book, but also tries to slip the odd cash sale in or ways to avoid tax, even if it is putting in business mileage when its really personal or claiming the odd parking ticket etc.
A partner in a very reputable firm of accountants once told me that there are some things you have to turn a blind eye to and providing the accounts are clean then you don't go looking for trouble.
I will not have anything to do with dishonesty and keep my cleints as legal as I can but I am not to know if there is the odd cash transaction going on. I do know of many friends that operate the odd cash transaction.
I just thought I would turn this over to debate, is there a totally honest client out there or do they all look for ways to avoid the tax?
I think many clients have trouble with understanding the idea of bookkeeping etc, ie using a Ltd co as thier own, paying bills which should be kept seperate etc
How can you be 100% sure that what the client gives you is the whole picture? Unless of course he drives an expensive car, lives in an expensive house, has luxury holidays and earns less than the taxable allowance!
I have a couple of residential care homes - how do I know what bills are for the business and what for their private residence if invoices are addressed to the home. I'm not there looking round to check. I did draw the line though at one where they were trying to claim for a lawnmower and that particular home didn't have any grass! That particular home was advised by the accountant to go Ltd a couple of years ago and she still doesn't understand the difference between operating as a sole trader and Ltd Co. I've even asked the accountant to have a word with her but it doesn't make any difference she still treats it like a personal bank. More problems are with Wickes, B & Q bills and supermarket bills for food and toiletries. C'est la vie.
Its a difficult one, and an accountant friend of mine said to me when I was querying something, sometimes we have to take what the client is telling us as correct. A client of mine thinks I wouldn't know the difference between fuel receipts for his Van and fuel receipts for a boat! The boat obviously goes to drawings.
I did once have a receipt for Vets bill for his dog!!! Not in the security business so went to drawings!
On a positive note I do have a couple of clients that I would say are about 100% honest and are brilliant.
A
-- Edited by Amanda on Tuesday 12th of January 2010 08:39:31 PM
-- Edited by Amanda on Tuesday 12th of January 2010 08:43:56 PM
Be careful with the boat fuel stuff, as at present HMRC are looking at this area closely as there is a 60/40 split on use in regard to VAT and I do know of someone fighting this at the mo....putting it as drawings and making this clear is the best way to go.
I do put his fuel for his boat to Drawings, he uses his Business account as a piggy bank but I am wise to it now, I think he thinks us bookkeepers are silly and wouldn't realise the difference!!!
This is interestting in the boat department. He has always denied he had one in the first place, but then has recently told the accountant that he has sold it.
The answer to your question is no I don't tell him because once I did and he denied having one, as probably bought with money that he hadn't paid the tax man with!!!!!
He would never ask as has not got a clue anyway. He thinks anything can go through the business but we all know thats not the case.
