What to do if you discover your accountant made a serious mistake

All businesses should have the services of an accountant to help with general financial matters such as business loans and taxation. You should ensure your relationship with your accountant is supported with a letter of engagement that sets out the terms by which your accountant will offer their services to your business.

If you are unhappy with the services offered by your accountant, and importantly, if you have suffered some financial loss as a result of advice they have given you, call us as you may have a claim for professional negligence.

The complaints process

If your accountant made a mistake, you should initially make a complaint to them and give them the opportunity to correct the error. All accountants should work to a code of practice that includes details of how complaints should be managed. However, if your accountant made a mistake, the ramifications were serious, and negligence could be proven, this could be grounds to sue them.

All accountants should be members of the Institute of Chartered Accountants in England and Wales. Scotland and Northern Ireland have their own Chartered Institutes. These representative bodies can also help with any complaint you have made against an accountant for a mistake they have made. More information, including a complaint application form can be downloaded from their websites.

After you have discovered the mistake your accountant has made, you have grounds to sue your accountant for negligence or misconduct if:

  • All formal complaints have been ignored by the accountant
  • The current solutions suggested by the accountant are still not satisfactory to achieve the desired outcome

Contacting a solicitor

You should contact a solicitor as soon as you can to have your particular case assessed. If your solicitor believes the mistake your accountant made was based on some form of negligence, or perhaps was deliberate, you can move forward with your case. Finding the right solicitor is where Contact Law can help. Suing for negligence is a method of regaining lost or potentially lost funds.

You should note that in matters of taxation, your accountant may prepare your accounts for submission to HMRC (HM Revenue & Customs) but you are ultimately responsible for the accuracy of your accounts.

Any mistake your accountant makes on your tax return will be your responsibility, as you should thoroughly check your returns before they are submitted. Any tax you owe or any fine you are given is very difficult to get your accountant to pay unless you can prove negligence or a deliberate act to deceive you. Your solicitor can give you more help and advice regarding the law in this area.

If you have suffered loss because of negligent advice of an accountant and you are looking to sue, accountants are likely to engage solicitors to defend them. Additionally, the solicitors acting for them are likely to have inserted a legal disclaimer in the written advice provided to you. Such a disclaimer may operate to protect the accountants from a lawsuit, but only if it is reasonable. By speaking to a specialist solicitor you will be better able to gauge the strength of your case.

For further information, see our guidance page on using tax accountants.

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