Tax accountant advised on wrong SIPP contribution - large tax sum due

caldi9

Good evening,
our tax accountant messed up. She advised us on how much to contribute to the SIPP. Turns out it was too much and we now sit on a £10k tax bill. How can the tax accountant held liable? She should face serious consequences in our view.
Thank you

Dazed_and_confused

What does your contract with the accountant say about this type of situation?

Have you treble checked everything to be certain the bill is correct?

MDMD

caldi9 wrote: »

Good evening,
our tax accountant messed up. She advised us on how much to contribute to the SIPP. Turns out it was too much and we now sit on a £10k tax bill. How can the tax accountant held liable? She should face serious consequences in our view.
Thank you

What was too much? If it was SIPP payment are you subject to the tapered pension allowance? Did you ask her to explain the calculations to you so that you understood what was in there.

Most will have a limitation of liability clause in the contract of something like 3x fees but ultimately in HMRC’s view it’s the taxpayer who is responsible for the figures in the return.

caldi9

We do not have a contract in place. The accountant sent us the calculation of the SIPP contribution which we followed. Turns out it was too much and now HMRC want a tax payment.

masonic

If there is no contract in place - for example, if this is a friend who happens to be an accountant who helped you out as a favour, rather than someone you hired professionally - then you would have no comeback. If you did hire this accountant to perform this work for a fee, then there will be a contract, which by default would be governed by the accountant's standard terms and conditions.

If the result of the calculation was wrong, then either the calculation itself was not carried out correctly, or the information provided was not accurate. It might be worth determining which of these it was before concluding who is liable.

Presuming there was an error in the calculation itself, then you would follow the normal complaints procedure outlined in the contract or standard T&Cs of your accountant.