# Have I been over charged by my accountant?



## confusedspen (14 Jul 2008)

After doing my taxes for 2006-2007, I recently recieved an invoice from accountant for €600. That is about as much as much I paid in taxes (I was on a very low income, working for myself).
I am surprised by the price - does that seem like a lot?


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## NicolaM (14 Jul 2008)

It seems ok.
I got charged €1850 for my returns last year (shockingly expensive, I thought).
Would you consider doing your returns yourself? Apparently quite easy online for self assessment.
Nicola


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## Joe1234 (14 Jul 2008)

What level of business would you have?  The accountant would probably charge by the length of time spent on completing your accounts.  I actually think that you got a good deal.


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## Iceman732 (14 Jul 2008)

The majority of accountants do set out to charge on a time input basis, however most accountants simply end up raising the fee by 10%. Chargeable time means little or nothing these days. 

As Joe1234 pointed out it does depend on the level of work involved and the neatness of your information. For example, if you have all your receipts organised i.e. all your telephone bills together and sorted, all your stationery expenses together etc,etc......

The minimum fee an accountant would charge is about €500, again this depends on a number of things. If for example you are going through a bad spell a decent accountant will go easy on the fee as he/she does want to keep you at a customer after all. It's better for the accountant to be getting €450 rather than nothing!

Were the actual accounts that were prepared or just an income and expenditure account? For instance did the accounts have a balance sheet etc....

Also, €600, is this including Prelim. for 2008? Did you have any tax liability at 41%?


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## jackswift (15 Jul 2008)

confusedspen said:


> After doing my taxes for 2006-2007, I recently recieved an invoice from accountant for €600. That is about as much as much I paid in taxes (I was on a very low income, working for myself).
> I am surprised by the price - does that seem like a lot?


 I am paying double that. Last year I had to get my accountant to calculate capital gains tax. I got an auctioneer to do 2 valuations he also had a lot of checking up on purchases over a 20 year period. The auctioneer charged me €150 for all that he done. What the accountant did was take all the auctioneers information and do the simple calculation for capital gains tax. The accountant charged me €1000. When I questioned this price he started telling me about all the info he had to collect I told him that the auctioneer got all that info and I had the paperwork to prove it, he then started rambling on about that there is a minimum charge for doing CGT and it was €1000. I have done the sum of how to calculate CTG in a tax course that I done, when you have all the figures it takes about 5 minutes. €1000 for 5 minutes work thats not bad.


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## Graham_07 (15 Jul 2008)

confusedspen said:


> After doing my taxes for 2006-2007, I recently recieved an invoice from accountant for €600. That is about as much as much I paid in taxes (I was on a very low income, working for myself).
> I am surprised by the price - does that seem like a lot?


 
The accountant's fee and the tax bill are unrelated. If you had a tax bill of nil would you have expected the accountant's bill to be nil also ? The work done may be more than you realise. Did you not request a fee quote before getting the work done? 





NicolaM said:


> It seems ok.
> I got charged €1850 for my returns last year (shockingly expensive, I thought)Nicola


 
If it is too expensive would you consider moving to an accountant whose charges are more in line with your expectations. Again, as above did you not agree terms? 




Iceman732 said:


> Also, €600, is this including Prelim. for 2008? Did you have any tax liability at 41%?


 
With a €600 tax bill the OP is unlikely to have had higher rate liability.




jackswift said:


> I have done the sum of how to calculate CTG in a tax course that I done, when you have all the figures it takes about 5 minutes. €1000 for 5 minutes work thats not bad.


 
With those sort of earnings perhaps you should consider pursuing a career in tax consultancy. Again, as in above, did you not ask what he was going to charge? 

The largely common thread here is the surprise at the level of charge. In most instances the client has not asked what the charge was going to be. If I am buying a TV, I ask the price. If I am getting a plumber to repair my boiler, I ask the rough price ( I know there will be +/- in some jobs so fair enough). However many people seem to rarely ask professionals ( not just accountants) what they are going to be billed. If you do not then how can you then be shocked or amazed by the price. Different accountants will have different fee scales/charges. They will vary for a multitude of reasons. There are no set charges or set hourly rates. One needs to ask. 

( I am an accountant & auditor in practice )


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## NicolaM (15 Jul 2008)

NicolaM said:


> shockingly expensive, I thought.





Graham_07 said:


> If it is too expensive would you consider moving to an accountant whose charges are more in line with your expectations.


I did, as a result of a big error in my previous return (thanks for advise you gave to me previously re this Graham, was very useful). 
I don't mind paying for something when it is done correctly, and unfortunately this was not done correctly for me. 
I have paid similar to my current accountant but to me it is not now 'shockingly expensive', as the work he has done is reliable, and I am very happy with his services, so even though the same price, it now is value for money (if that makes sense).
Nicola


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## jackswift (15 Jul 2008)

Graham_07 said:


> With those sort of earnings perhaps you should consider pursuing a career in tax consultancy. Again, as in above, did you not ask what he was going to charge?
> 
> The largely common thread here is the surprise at the level of charge. In most instances the client has not asked what the charge was going to be. If I am buying a TV, I ask the price. If I am getting a plumber to repair my boiler, I ask the rough price ( I know there will be +/- in some jobs so fair enough). However many people seem to rarely ask professionals ( not just accountants) what they are going to be billed. If you do not then how can you then be shocked or amazed by the price. Different accountants will have different fee scales/charges. They will vary for a multitude of reasons. There are no set charges or set hourly rates. One needs to ask.
> 
> ( I am an accountant & auditor in practice )


 No I did not ask what he was going to charge as I thought that it would be included in the normal yearly fees, like it has been for the fifteen years he has been doing my accounts. Like I said I wouldn't expect him to have a seperate charge for doing a five minute sum. If you're buying a TV you ask the price then  they tell you its extra for the plug, come on there is a big difference between the two. As for the comment about pursuing a career in tax consultancy I will ignore that. By the way what would normally charge for CTG when someone supplies all the details?


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## jackswift (15 Jul 2008)

Graham_07 said:


> With those sort of earnings perhaps you should consider pursuing a career in tax consultancy. Again, as in above, did you not ask what he was going to charge?
> 
> The largely common thread here is the surprise at the level of charge. In most instances the client has not asked what the charge was going to be. If I am buying a TV, I ask the price. If I am getting a plumber to repair my boiler, I ask the rough price ( I know there will be +/- in some jobs so fair enough). However many people seem to rarely ask professionals ( not just accountants) what they are going to be billed. If you do not then how can you then be shocked or amazed by the price. Different accountants will have different fee scales/charges. They will vary for a multitude of reasons. There are no set charges or set hourly rates. One needs to ask.
> 
> ( I am an accountant & auditor in practice )


 No I did not ask what he was going to charge as I thought that it would be included in the normal yearly fees, like it has been for the fifteen years he has been doing my accounts. Like I said I wouldn't expect him to have a seperate charge for doing a five minute sum. If you're buying a TV you ask the price then  they tell you its extra for the plug, come on there is a big difference between the two. As for the comment about pursuing a career in tax consultancy I will ignore that. By the way what would normally charge for CTG when someone supplies all the details?


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## Graham_07 (15 Jul 2008)

jackswift said:


> As for the comment about pursuing a career in tax consultancy I will ignore that. By the way what would normally charge for CTG when someone supplies all the details?


 
1) It's CGT not CTG.  'Nuff said. 

2) I repeat what I said above. Different accountants will have different fee scales/charges. They will vary for a multitude of reasons. There are no set charges or set hourly rates. One needs to ask.

3) It is very foolish to expect something to be included unless it has been  included every year.  That being said I have , where the job was as you stated " 5 minutes" done CGT computations for no additional charge, especially in cases of long standing clients who are already paying for an income tax/accountancy service.  I have also in other cases, separately charged, especially in cases where it was obvious that it was not going to be the "5 minute" job that the client might have expected. I would expect the client to value their time and expertise and would hope that they expect the same of me. This is where it is important to have clear lines of communication.


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## Graham_07 (15 Jul 2008)

NicolaM said:


> I have paid similar to my current accountant but to me it is not now 'shockingly expensive', as the work he has done is reliable, and I am very happy with his services, so even though the same price, it now is value for money (if that makes sense).
> Nicola


 
I understand your reasoning. To paraphrase the old adage about old bold soldiers -  "there are good accountants and there are cheap accountants but there are no good cheap accountants "


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## ubiquitous (15 Jul 2008)

€1,000 is not expensive for a CGT computation IF there is a significant gain and IF the person completing the computation and return is an expert on CGT. I have seen many cases where people have overpaid CGT through getting incorrect/incomplete advice, and I have seen some cases where people underpaid CGT by incorrectly claiming reliefs and ended up being screwed by the Revenue for interest and penalties later on.  As always you get what you pay for.


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## simplyjoe (15 Jul 2008)

Not always true Ubiq. There are rogues out there who charge outrageous prices for poor workmanship. Simply being an ACA, ACCA or CPA is not enough. A lot of older accountants fail to keep up to date and repeat the same mistakes over and over. A lot of younger accountants suffer from inexperience and are more worried about their trip to St. Andrews or their 7 series than in providing quality service.


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## ubiquitous (15 Jul 2008)

simplyjoe said:


> Not always true Ubiq. There are rogues out there who charge outrageous prices for poor workmanship. Simply being an ACA, ACCA or CPA is not enough. A lot of older accountants fail to keep up to date and repeat the same mistakes over and over. A lot of younger accountants suffer from inexperience and are more worried about their trip to St. Andrews or their 7 series than in providing quality service.



Indeed, in any walk of life, expensive does not automatically mean good, but on the other hand, most reputable experts will command fees much higher than the cheapest alternatives. As always, recommendations from previous customers (satisfied & otherwise) are the best way for the customer to tell the difference.


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## simplyjoe (15 Jul 2008)

ubiquitous said:


> As always, recommendations from previous customers (satisfied & otherwise) are the best way for the customer to tell the difference.


 Absolutely correct.


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## jackswift (15 Jul 2008)

Graham_07 said:


> 1) It's CGT not CTG.  'Nuff said.


 I know that it is CGT it was a typing error read my first post I am not a typing expert like you


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## Graham_07 (16 Jul 2008)

jackswift said:


> I know that it is CGT it was a typing error read my first post I am not a typing expert like you


 


jackswift said:


> have done the sum of how to calculate CTG in a tax course that I done,


 
Attention to detail, one of the things that makes €1,000 for "5 minutes work" worth it all. . 

I always liked the story of the service engineer who was called to fix a machine in a factory. The production manager showed him the machine. The engineer looked at it, walked round it, then after pondering for a few minutes asked for a hammer. Puzzled the manager got one for him. The engineer selected a spot on the side of the machine and gave it a short sharp tap with the hammer. The machine started running perfectly. Later the manager got the engineers bill. It read : 
"To machine repair €100.00." 
The manager, thinking this excessive wrote to the engineer for a detailed breakdown of the charge. The engineer replied with the detail : 
"One tap of hammer €10.00.
Knowing where to tap €90.00."


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## jackswift (16 Jul 2008)

Graham_07 said:


> Attention to detail, one of the things that makes €1,000 for "5 minutes work" worth it all. .


If half reading a post is attention to detail, kettle, pot ring any bells.


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## Graham_07 (16 Jul 2008)

jackswift said:


> If half reading a post is attention to detail, kettle, pot ring any bells.


 
Depends on whether the half that was read was spelled correctly or not


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## jackswift (16 Jul 2008)

Graham_07 said:


> Depends on whether the half that was read was spelled correctly or not


 Great comeback, I'll remember that one  Shouldn't you be filing someone's tax returns right now?


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## Graham_07 (16 Jul 2008)

jackswift said:


> Great comeback, I'll remember that one  Shouldn't you be filing someone's tax returns right now?


 
Ah well you see that's what happens when you run things correctly. It means I'm actually looking at  late deal holidays right now  . Santorini or Lanzarote, first week in August what do you think?


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## jackswift (16 Jul 2008)

Graham_07 said:


> Ah well you see that's what happens when you run things correctly. It means I'm actually looking at  late deal holidays right now  . Santorini or Lanzarote, first week in August what do you think?


 Go for it all it will cost you is two CGT computations


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## jackswift (16 Jul 2008)

Graham ahora mejoramos la parada este absurdo o uno de nosotros será prohibido del AAM


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## Graham_07 (16 Jul 2008)

jackswift said:


> Graham ahora mejoramos la parada este absurdo o uno de nosotros será prohibido del AAM


 
Muy bien mi amigo  buenos tardes.


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## NicolaM (16 Jul 2008)

jackswift said:


> Graham ahora mejoramos la parada este absurdo o uno de nosotros será prohibido del AAM





Graham_07 said:


> Muy bien mi amigo  buenos tardes.


El español no es una lengua secreta chicos!


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## jackswift (16 Jul 2008)

NicolaM said:


> El español no es una lengua secreta chicos!


Non c'è nessun linguaggio del Nicola m. segreto io era controllo giusto per vedere se Graham fosse dopo la spazzolatura in su sul suo Spagnolo prima della sua festa.


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## NicolaM (16 Jul 2008)

Siete multi di talento Jackswift.
Molto sono impressionato con voi!
Nicola


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## Graham_07 (17 Jul 2008)

Graham_07 said:


> Santorini or Lanzarote, first week in August what do you think?


 


jackswift said:


> Non c'è nessun linguaggio del Nicola m. segreto io era controllo giusto per vedere se Graham fosse dopo la spazzolatura in su sul suo Spagnolo prima della sua festa.


 
Greco e Spagnolo Jackswift !


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## budapest (17 Jul 2008)

Graham_07 said:


> there are good accountants and there are cheap accountants but there are no good cheap accountants



I don't think that this is necessarily true.  I had a previous rather expensive accountant, who had 20-30 years experience, but made some potentially costly errors in the tax advice he gave me.  I switched to somebody who cost half as much, had around 10 years experience, but was much more aware of recent changes in tax legislation, etc.  She was extremely competent, but eager to expand her business, so charged very competitively.


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## budapest (17 Jul 2008)

Graham_07 said:


> there are good accountants and there are cheap accountants but there are no good cheap accountants



I don't think that this is always true.  I had a previous rather expensive accountant, who had 20-30 years experience, but made some potentially costly errors in the tax advice he gave me.  I switched to somebody who cost half as much, had around 10 years experience, but was much more aware of recent changes in tax legislation, etc.  She was extremely competent, but eager to expand her business, so charged very competitively.  She was also much easier to deal with as she didn't have the slightly arrogant/know-it-all attitude of the previous guy.


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## ubiquitous (17 Jul 2008)

"Half as much" of the rate charged by a particularly expensive provider does not necessarily equate to "cheap". 

The original post in this thread was from someone who was charged €600 for self-assessment accounts & tax return and thought they were being overcharged. Twenty years ago I was training with a provincial firm who at the time were charging small sole traders £500/€600 plus VAT for a similar service. This was at a time when they were paying part-qualified trainee staff about £2-£3 per hour.  In todays terms, the equivalent pro-rata fee would perhaps be €3,000+.  

No matter how good value is offered, some people will always think they are getting poor value.


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## Graham_07 (17 Jul 2008)

budapest said:


> I don't think that this is always true. I had a previous rather expensive accountant, who had 20-30 years experience, but made some potentially costly errors in the tax advice he gave me. I switched to somebody who cost half as much, had around 10 years experience, but was much more aware of recent changes in tax legislation, etc. She was extremely competent, but eager to expand her business, so charged very competitively. She was also much easier to deal with as she didn't have the slightly arrogant/know-it-all attitude of the previous guy.


 

Fair enough and good on her. I suppose everyone may have a different perception of "cheap". There are those in every trade/ profession who charge high sums which might not necessarily be commensurate with their skill or the time & effort put in. It probably comes down to what both parties are happy with. Last year I got a specialist tax opnion for a client. It cost €1,750+VAT for 6 hours. The client saved in excess of €100K. Well worth it. I've seen people pay very high sums for work which I would not charge nearly as much for. The ultimate lesson I suppose is check before you buy.


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## Iceman732 (17 Jul 2008)

Graham_07 said:


> With a €600 tax bill the OP is unlikely to have had higher rate liability



Sorry Graham I have to pull you up on that ridiculous comment. 

Take this example: 

Gross Emoluments of €500,000 and PAYE paid of €200,000 and also has a rental profit of €1,500.

1. Assume PAYE paid covers tax liability on Gross Emoluments. (I'm not going to work out the liability!)

2. Assume €1,500 charged to tax at marginal rate.

The tax bill on the rental income would amount to €615, ignoring PRSI and levies. The individual would fall subject to self-assessment as they have rental income, therefore the individual would have a tax liability of €615 + €615 PT.

So you're telling me someone with a €600 liability is unlikely to have 41% income?!!!!!!!!!!!!!!!!!!!!!!!!

Tut tut Graham


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## Graham_07 (18 Jul 2008)

confusedspen said:


> I was on a very low income, working for myself.


 


Graham_07 said:


> With a €600 tax bill* the OP* is unlikely to have had higher rate liability.


 


Iceman732 said:


> Sorry Graham I have to pull you up on that ridiculous comment.
> So you're telling me someone with a €600 liability is unlikely to have 41% income?!!!!!!!!!!!!!!!!!!!!!!!!


 
Thanks for the example you gave which of course is largely correct in the context of that case as you presented. In fact, I'm sure we could come up with several computations where the additional liability to tax/prsi/levy could in fact exceed the additional income. 

However in the context of the case of the OP to this specific thread ( which is, I think, what we were dealing with at the time and not your example) and the OP's specific comments on being self-employed with no mention of any other sources of income such as rents which of course could colour the result as might any of a number of other sources of income and on what they quoted as a very low income (Of course €500,000 might be low to some people), I do not consider my answer in the context of the OP to be ridiculous. 

P.S. Do 24 !'s have more effect that 1 !


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## ubiquitous (18 Jul 2008)

Graham_07 said:


> ... the OP's specific comments on being self-employed with no mention of any other sources of income such as rents which of course could colour the result as might any of a number of other sources of income and on what they quoted as a very low income ...




Of course if the OP had other self-assessment income such as rents in addition to their trading income, the €600 accountancy fee would start looking ridiculously cheap rather than the opposite.


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## Graham_07 (18 Jul 2008)

ubiquitous said:


> Of course if the OP had other self-assessment income such as rents in addition to their trading income, the €600 accountancy fee would start looking ridiculously cheap rather than the opposite.


 
Absolutely correct. It looks most likely from the information provided that the OP is a small business with no other complications of other sources of income, getting their annual accounts and self-assessment tax return filed and paying a €600 for same. Of course only the OP can clarify this to be the case.


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## Iceman732 (18 Jul 2008)

Graham naturally I was going for effect with the example I created above. My point was that the idea of someone with a tax bill of €600 does not necessarily mean that they don't have income at 41%. 

I'll make the situation a little easier, let's take the above example of the OP, assume married under joint assessment. Spouse only as P60, so the accountants bill would be no different to just have self-employed income. Spouse on salary of €80,000. Couple liable to circa €32,000 at higher rate. 

Just try and keep the hugely sarcastic comments to a minimum when you are in fact incorrect with you original comment.  

Thanking you in advance.

P.S I've used no ! just for you Graham.


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## Graham_07 (19 Jul 2008)

Iceman732 said:


> Just try and keep the hugely sarcastic comments to a minimum when you are in fact incorrect with you original comment.


 
 hugely sarcastic 

One can speculate and compute innumerable circumstances for the OP. However until such time as the OP states that their situation is anything other than as was assumed from their original post, I stand by all comments made. I see no reason not to. If their situation meets any of the examples you gave then of course there may be adjustments.

PS Thanks for leaving out the !'s. After the BBQ & bottles last night don't think could count to 4 not to mind 24.


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## MAGPIEKB (20 Jul 2008)

budapest said:


> I don't think that this is always true. I had a previous rather expensive accountant, who had 20-30 years experience, but made some potentially costly errors in the tax advice he gave me. I switched to somebody who cost half as much, had around 10 years experience, but was much more aware of recent changes in tax legislation, etc. She was extremely competent, but eager to expand her business, so charged very competitively. She was also much easier to deal with as she didn't have the slightly arrogant/know-it-all attitude of the previous guy.


 
I think it might be worth noting that 600 euros is still a lot of money to many people, myself included. Im now using an accountant in wicklow, i have found them to charge less than in Dublin. Id be curious to hear more about your accountant budapest. How did you find her?


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