CLAIMS AGAINST ACCOUNTANTS AND TAX ADVISORS

Common examples of claims against accountants and tax advisors:

1. Advising business clients (including individuals) to enter tax avoidance schemes.

• These are schemes whereby a company/ business seemingly minimizes the impact of tax but are subsequently criticized by HMRC.
• Examples of these include film partnership schemes or loan charge schemes.

 

2. Undertaking audit work for a business.

• Often an accountant can be instructed to undertake audit work for a company, this may include for instance reviewing the books and ensuring that the company reports correctly in its annual accounts.
• Where an accountant does not follow the correct procedure, or fails to undertake the audit correctly, then the company may have a claim against them.

 

3. Advising on the valuation of a company’s assets or goodwill.

• An accountant may be instructed to undertake a valuation of company assets or goodwill during the sale/ purchase process.
• If the valuation is incorrect (either over or undervalued) this could result in a loss in respect of which you may be able to claim.

 

4. Advising on the tax implications of a business sale/ asset sale.

• An accountant and/or tax advisor may be instructed to provide advice on the tax implications of a business/ asset sale. You may for instance want to ensure that the deal is structured in such a way so you can benefit from tax relief, such as entrepreneur relief, which can have massive tax benefits.
• If the accountant and/or tax advisor gets it wrong, it could have the opposite effect and could cost you significantly more than what you otherwise should have to pay.