You wouldn't trust a complete stranger with your tax affairs without first checking their credentials, now, would you…? Taking a few minutes to ensure that a tax refund company is worthy of your trust and hard cash could not only save you money but potentially spare you some headaches and valuable time in the long run. Part 2 of this article gives more tips on how to spot unethical tax refund companies.
Here are 4 more “insider” tips…
4 more "valuable"insider" tips to help you select a reputable tax refund company
5. What is their reputation?
Remember, you are a looking for a reputable tax agent. Read online reviews and forums and look for patterns of unethical behaviour. Take some of the reviews with a pinch of salt, though, as it is current practice for many firms to post unverified reviews online or even remove negative reviews. Unless they constitute a majority or you can see a discernible pattern to them, a few negative reviews may not necessarily indicate that a firm is untrustworthy or inefficient. However, a firm that only has positive reviews about them has probably hired the services of an online reputation management expert to eliminate adverse comments from clients and hide some embarrassing facts from the public.
6. Check their credentials and accreditations
If a firm displays any logos or accreditations, check with the relevant body if the firm in question (or at least one of their staff) is actually registered with them. If they’re not, they should not display such logos. Some firms cleverly design their own self-regulated ‘association’, ‘alliance’ or ‘federation’ to lend them an air of respectability. Therefore, membership to a particular professional body or association may not prove that a firm is automatically trustworthy.
Only give credence to recognised official bodies like ACCA (Association of Chartered Certified Accountant) or AAT (Association Of Accounting Technicians), to name a few. Any accreditation that demonstrates that they have sound internal processes and quality audits is also definitely a 'plus' point (like ISO 9001, for example).
The truth about tax refunds is that each client’s case is unique; claiming that other taxpayers have received several hundreds of pounds worth of tax refunds cannot serve as a benchmark to how much you could get when using the same services. No tax agent can quote you a figure for a tax refund unless you first supply them with specific documents (like P45, P60, Employment history; etc.) and then they compare those with HMRC’s own records (which they can only do if you signed the official form “Authorising your agent (64-8)”).
7. Are they financially sound?
You wouldn’t trust the management of your own money to an organisation that is on the brink of bankruptcy, or which has already been declared bankrupt, would you…? There is a vast amount of free information available in the public domain about companies trading in the UK. Check the Companies House website (an official government agency) if the company you’re researching is actually registered and actively trading. Look for any CCJs (County Court Judgements) or “Gazette notices” that may have been issued against them.
Weigh the info you gather against the firm’s claims. For example, I remember a certain tax refund company that boasted “several thousands of happy clients”. A quick check of the Companies House website revealed that the firm in question had only been trading eight months, and had been “dormant” (non-trading) for the last 3 months! Clearly, their claim of having “thousands of happy clients” was bogus and spoke volumes about their ethics.
8. Trust your instincts
Don’t underestimate your own intuition. Does the content of their website inspire confidence? Are there any vague or unsubstantiated statements? Does it feel that are setting visitors with unrealistic expectations? Read the blog section of their website (if there is one) to ascertain if they are experts in their field. Call and ask questions before giving over the authority to deal with your personal tax affairs to anyone. Gauge from their answers if the staff appear knowledgeable or not. Do they sound ‘salesy’ or ‘pushy’? Do they actually answer your questions in a satisfactory manner? Don’t ignore ‘alarm bells’ in your mind. If it doesn’t feel right, the best course of action is to move on to the next company until you find one that you are comfortable with.
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