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Or Can I have my books back please?

tommy and dil fight like tax agents over clients books

It’s never nice when accountants fight.

When a new client appoints me as their accountant, I’m often told that their bookkeeper or old accountant (known collectively as tax agents) has all of their records, and they can’t get them back.

It’s commonly about a dispute over fees and charges, but often the former agent denies having the records or allegedly, doesn’t know where they are.

This is potentially serious as Accounts and Tax Returns have to be filed by a specific date and HMRC tend not to be overly sympathetic to these kinds of problems. Quite the opposite, they seem more than happy to issue ever increasing fines and penalties for non-submission of the returns and blandly state that it’s the taxpayer’s responsibility.

So what can you do? Well, no two scenarios are the same, but I have a number of comments and suggestions:-

  1. Write to the agent formally requesting the paperwork and send the letter by recorded delivery.
  2. Go to their office and demand the paperwork, however, take care not to overstep the mark here and potentially cause criminal issues for yourself by losing your rag and verbally or physically abusing your old agent.
  3. If it’s a dispute over fees, offer to pay what is not in dispute as a gesture of good faith and in my experience most agents will then cooperate.
  4. Alternatively, go to a solicitor and start civil proceedings.
  5. Contact your bank and request duplicate bank statements, same with credit cards etc.
  6. As far as you can remember, write down a list of all the documents you believe you passed to the agent, many of which you should be able to get duplicates for and if anything is computerised, reprint. Also if you can’t get duplicates, at least write down estimates of what you spent and what on.
  7. Hand all this information to your new accountant and when asked provide full explanations to all questions.
  8. Keep chasing for the records from the former agent and document everything. If you eventually get anything further you can always submit an amended tax return.
  9. Do not wait until penalties and fines have started before taking action to recover or duplicate your documentation.
  10. If your struggling to provide the information to your new accountant by the 31st January deadline, ask him or her to file a provisional return with a realistic profit to stop those penalties accruing.

It is common in this kind of scenario for me to complete a tax return based on incomplete records with the gaps based on estimates; and to avoid later complications with HMRC, in “the other information box” on the tax returns I can enter what estimations I have used and why.

Also, if the client has left it to the last minute before coming to see me and I have no choice other than submit a provisional return, we then have 12 months to submit an accurate final tax return.

And finally, if the client has been so preoccupied chasing up their old agent that the 31st January deadline is missed then, depending on the circumstances, you may well have a “reasonable excuse” defence to challenge the HMRC fines and other penalties.  We can help find out how to challenge a tax penalty here

David Jones is the Senior Partner and Founder of Morgan Jones & Company. Born in Liverpool and a graduate of Liverpool Collegiate Grammar School, David spent twenty years working for the Customs & Excise in London then Shrewsbury before starting his own business. David’s depth of knowledge of the UK tax system and his ability to communicate this learning has seen Morgan Jones & Company grow into Shropshire’s most respected Accountancy Practice. Email David