Why people engage an accountant...

 Why people engage an accountant....

HMRC: You owe us money. It's called taxes.

YOU: How much do I owe?

HMRC: You have to figure that out.

YOU: I can just pay what I want?

HMRC: Oh, no. We can guess how much you owe. But you need to guess it first. Or work it out properly - which we prefer.

YOU: What if I get it wrong?

HMRC: We'll fine you or send you to prison!

YOU: I need help!!

What does 'certified' copies mean?

Accountants frequently ask new clients to either bring their passport into the office or to supply certified copies. It's a requirement of the anti-money laundering regulations.

An accountant told me recently that a new client recently sent him a package. 

On opening it the accountant found a copy of the client's passport. What else? 

Another one. Same as the first. 

And another, and another. 

Indeed the package simply contained almost 3 dozen photocopies of the client's passport. 

None had been certified by a solicitor - or anyone.

The accountant called the client to acknowledge receipt of the package and to find out why he had sent so many copies - and not had any of them certified.

The client was pleased to hear the package had arrived safely.

"But I still don't know why you asked for 35 copies."

For every tax problem...

 For every tax problem there is a solution - which is straightforward, uncomplicated and wrong.

Before PwC, before Coopers & Lybrand, there was Cooper Brothers.....

PwC was initially called PriceWaterhouseCoopers having been formed by the merger of Coopers and Lybrand and Price Waterhouse.

Long before that merger Coopers & Lybrand was originally called Cooper Brothers and based in Gutter Lane, London. 

Indeed they may have been the only building with an address identified as being in Gutter Lane. 

Legend has it that at one stage the partners wrote to the Corporation of London suggesting that, in view of their long tenancy, it might be appropriate to rename the place Coopers Lane. 

The Corporation, so the story goes, wrote back saying "As we've been here longer why don't you change your name to Gutter Brothers." 

Post script: I was told a while back that when, much more recently, the Corporation was selling off at auction the old City street signs, Coopers & Lybrand bought the Gutter Lane set.

Are some tax advisers paying more than they need to?

Some years ago on my first visit to Penrith, Cumbria, to present a talk to the local CIOT branch, I took a cab to the venue. 

The driver asked me what I was doing in Penrith and I explained: “I’m here to give a lecture to a group of tax advisers”. 

For a moment I was thrown as he seemed very miffed. 

It then became clear from his reply that he had misheard me: “It would be nice to have been invited. I’ve been a taxi driver here for over ten years!” I was unable to keep a straight face! 

I shared the story during my talk and at the tea-break one of the delegates came over to explain she’d had a similar problem recently. 

When arranging her car insurance by phone, she was astonished by the premium quote. It was more than 8 times what she had paid the previous year. 

She queried the figure and was told this was due to her profession, and the risks inherent in this. “What are the inherent risks of being a tax adviser?” she asked. 

At which point it became apparent the insurer had thought she said she was a ‘taxi driver’.

"Morton's Fork" - the rock and a hard place options for taxpayers

The expression "Morton's Fork" originates from a policy of tax collection.

It was devised by John Morton, who was Lord Chancellor of England in 1487, under the rule of King Henry VII. 

Morton's approach was that if the subject lived in luxury and had clearly spent a lot of money on himself, he obviously had sufficient income to spare for the king. 

Alternatively, if the subject lived frugally, and showed no sign of being wealthy, he must have substantial savings and could therefore afford to give it to the king. 

These arguments were the two prongs of the fork and regardless of whether the subject was rich or poor, he did not have a favourable choice. 

The phrase is rarely used these days as there is a more common analogy when someone has a dilemma and has to choose between two equally unpleasant alternatives. 

We tend to say that they are either "Between the Devil and the Deep Blue Sea" or "Between a rock and a hard place".

The accountant with a special time clock

Years ago there was an unscrupulous accountant who always overcharged his customers. 

 He had a special clock built that ran faster than other clocks. It ran at nearly twice the speed of a normal clock so that 1 hour would appear as 2 hours. 

He then tracked his time by using the fast clock and in essence doubled his billing hours. 

 He bragged about his overcharging process to his close friends and his wife. 

He also bragged about other topics such as his golf score, his time in running the mile and his endurance when being intimate with his wife. 

 The latter was his most proud accomplishment. Therefore, it took him by surprise when his wife filed for divorce a year later. 

He remonstrated with her “Dear why would you leave me? I have given you money, a fine house, companionship and a great love life!” 

She replied, “True, you have given me money and a fine house – although by ill gotten gains. Your companionship is shallow because you only think of yourself AND as to your skills in the bedroom, I just wanted you to know that I had a clock made just like the one you use at work!”