Penn and Company

Chartered Accountants and Chartered Tax Advisers

TERMS OF BUSINESS – effective from 1 December 2021

The following terms of business apply to all engagements accepted by Penn and Company. All work is carried out under these terms except where changes are expressly agreed in writing.

• Applicable law
  • Our engagement letter, the schedules of services and our standard terms and conditions of business are governed by, and should be construed in accordance with, English law. Each party agrees that the courts of England will have exclusive jurisdiction in relation to any claim, dispute or difference concerning this engagement letter and any matter arising from it on any basis. Each party irrevocably waives any right to object to any action being brought in those courts, to claim that the action has been brought in an inappropriate forum, or to claim that those courts do not have jurisdiction.
  • We will not accept responsibility if you act on advice previously given by us without first confirming with us that the advice is still valid in light of any change in the law or in your circumstances. We will accept no liability for losses arising from changes in the law, or the interpretation thereof, that occur after the date on which the advice is given.

• Professional rules and practice guidelines
  • We will observe and act in accordance with the Bye-laws, regulations and Code of Ethics of the Institute of Chartered Accountants of England and Wales and will accept instructions to act for you on this basis. In particular you give us the authority to correct errors made by HMRC if we become aware of them. We will not be liable for any loss, damage or cost arising from our compliance with statutory or regulatory obligations. You can see copies of these requirements in our offices. The requirements are also available online at icaew.com/en/membership/regulations-standards-and-guidance.

• Client Identification – Proceeds of Crime Act 2002 and The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017
  • As with other professional services firms, we are required to identify our clients for the purposes of the UK anti-money laundering legislation. We may request from you, and retain, such information and documentation as we require for these purposes and/or make searches of appropriate databases. If we are not able to obtain satisfactory evidence of your identity, we will not be able to proceed with the engagement.

• Confidentiality
  • Unless we are authorised by you to disclose information on your behalf, we confirm that if you give us confidential information we will, at all times during and after this engagement, keep it confidential, except as required by law or as provided for in regulatory, ethical or other professional pronouncements applicable to us or our engagement.
  • We may, on occasion(s), subcontract work on your affairs to other tax or accounting professionals. The subcontractors will be bound by our client confidentiality terms.
  • We reserve the right, for the purpose of promotional activity, training or for similar business purpose, to mention that you are a client. As stated above we will not disclose any confidential information.
  • If we use external or cloud based systems, we will ensure the confidentiality of your information is maintained.
  • This applies in addition to our obligations on data protection in section 14.

• Quality control
  • As part of our ongoing commitment to providing a quality service, our files are periodically reviewed by an independent regulatory or quality control body. These reviewers are highly experienced and professional people and, of course, are bound by the same rules for confidentiality as our principals and staff.
• When dealing with HMRC on your behalf we are required to be honest and to take reasonable care to ensure that your returns are correct. To enable us to do this, you are required to be honest with us and to provide us with all necessary information in a timely manner. For more information about ‘Your Charter’ for your dealings with HMRC, visit www.gov.uk/government/publications/your-charter. To the best of our abilities, we will ensure that HMRC meet their side of the Charter in their dealings with you.

• Help us give you the best service
  • We are committed to providing you with a high quality service that is both efficient and effective. If at any time there is cause for complaint in relation to any aspect of our service please contact Jonathan Penn on 01449 673355 or at jonathan@pennandcompany.co.uk, or alternatively at the address given below. We will consider carefully any complaint you may make about our service as soon as we receive it and do all we can to explain the position to you.  We will acknowledge your communication within five business days of its receipt and endeavour to deal with your complaint within eight weeks.  If you are still not satisfied you can refer your complaint to our professional body, the Institute of Chartered Accountants in England and Wales (icaew.com).

• Limitation of Third Party Rights
  • The advice and information we provide to you as part of our service is for your sole use, and not for any third party to whom you may communicate it, unless we have expressly agreed in the engagement letter that a specified third party may rely on our work. We accept no responsibility to third parties to whom the engagement letter is not addressed, for any advice, information or material produced as part of our work for you which you make available to them. A party to this agreement is the only person who has the right to enforce any of its terms, and no rights or benefits are conferred on any third party under the Contracts (Rights of Third Parties) Act 1999.

• Fees
  • Our fees are calculated on the basis of the time necessarily spent on your affairs by the principals and staff and on the levels of skill or responsibility and the importance and value of the advice we provide, as well as the level of risk. Our fees will be billed quarterly or at the completion of a significant amount of work, together with outlays and VAT at the rate prevailing, and our invoices will be due for payment on presentation.
  • If we need to do work outside the responsibilities outlined in our engagement letter, we will advise you in advance. This will involve additional fees.
  • We reserve the right to charge interest on overdue accounts at the current rate under the Late Payment of Commercial Debts (Interest) Act 1998. We also reserve the right to terminate our engagement and cease acting if payment of any fees billed is unduly delayed.

• • Period of Engagement and Termination or Disengagement
    • Unless otherwise agreed in our engagement letter, our work will begin when we receive implicit or explicit acceptance of that letter. Except as stated in that letter, we will not be responsible for periods before that date.
    • Each of us may terminate our agreement by giving not less than 21 days’ notice in writing to the other party except if you fail to cooperate with us or we have reason to believe that you have provided us (or HMRC) with misleading information, in which case we may terminate this agreement immediately. Termination will be without prejudice to any rights that may have accrued to either of us before termination.
    • We reserve the right to terminate the engagement between us with immediate effect in the event of: your insolvency, bankruptcy or other arrangement being reached with creditors; an independence issue or change in the law which means we can no longer act; failure to pay our fees by the due dates; or either party being in breach of their obligations if this is not corrected within 30 days of being asked to do so.
    • In the event of termination of our contract, we will endeavour to agree with you the arrangements for the completion of work in progress at that time, unless we are required for legal or regulatory reasons to cease work immediately. In that event, we will not be required to carry out further work and shall not be responsible or liable for any consequences arising from termination.
• If we resign, or are asked to resign, we will normally issue a disengagement letter to ensure that our respective responsibilities are clear. If we have no contact with you for a period of two years or more, we may issue to your last known address a disengagement letter and thereafter cease to act.

• Timings of our Services
  • If you provide us with all information and explanations on a timely basis in accordance with our requirements, we will plan to undertake the work within a reasonable period of time to meet any regulatory deadlines. However, failure to complete our services before any such regulatory deadline would not, of itself, mean that we are liable for any penalty or additional costs arising.

• Reliance on advice
  • We will endeavour to record all advice on important matters in writing. Advice given orally is not intended to be relied upon unless confirmed in writing. Therefore, if we provide oral advice (for example, during the course of a meeting or a telephone conversation) and you wish to be able to rely on that advice, you must ask for the advice to be confirmed by us in writing.

• Conflicts of interest
  • We will inform you if we become aware of any conflict of interest in our relationship with you or in our relationship with you and another client unless we are unable to do so because of our confidentiality obligations. Where conflicts are identified which cannot be managed in a way that protects your interests then we regret that we will be unable to provide further services. If this arises, we will inform you promptly.
  • We reserve the right to act for other clients whose interests are not the same as, or are adverse to yours, subject to the obligations of confidentiality referred to above. You agree that, if we act for other clients who are or who become your competitors, to comply with our duty of confidentiality it will be sufficient for us to take such steps as we think appropriate to preserve the confidentiality of information given to us by you, both during and after this engagement. These may include taking the same or similar steps as we take in respect of the confidentiality of our own information. You agree that the implementation of such steps or safeguards will provide adequate measures to avoid any real risk of confidentiality being impaired.
  • If there is a conflict of interest that is capable of being addressed successfully by the adoption of suitable safeguards to protect your interests, we will adopt those safeguards. In resolving the conflict, we would be guided by ICAEW’s Code of Ethics, which can be viewed at com/en/membership/regulations-standards-and-guidance/ethics. During and after our engagement, you agree that we reserve the right to act for other clients whose interests are or may compete with or be adverse to yours, subject, of course, to our obligations of confidentiality and the safeguards set out in the paragraph above.

• Internal Disputes within a Client
  • If we become aware of a dispute between the parties who own or manage a client, or are in some way involved in its ownership or management, or parties to a marriage or civil contract, or trustees/executors we will not provide information or services to one client/owner/manager/trustee/executor/spouse/civil partner without the express knowledge and permission of both/all clients/owners/managers/trustees/executors/ spouses/civil partners. If conflicting advice, information or instructions are received from different parties, we will refer the matter back to the client and take no action until the parties have agreed that action to be taken

• Data Protection
  • During the course of our engagement you may disclose personal data to us in order that we may provide our services to you. The processing of personal data is regulated in the UK by the Data Protection Act 2018 together with other laws which relate to privacy and electronic communications.  In this clause, we refer to these laws as “Data Protection Law”.  In providing our services, we act as an independent controller and are, therefore, responsible for complying with Data Protection Law in respect of any personal data we process in this document and which can also be accessed at www.pennandcompany.co.uk) explains how we process personal data.  You are also an independent controller responsible for complying with Data Protection Law in respect of your own personal data that you process and, accordingly, where you disclose such personal data to us you confirm that such disclosure is fair and lawful and otherwise does not contravene Data Protection Law.  Terms used in this clause bear the same meanings as are ascribed to them in Data Protection Law.

• Retention of records
  • You have a legal responsibility to retain documents and records relevant to your financial affairs. During the course of our work we may collect information from you and others relevant to your tax and financial affairs.

We will return any original documents to you, if requested. Documents and records relevant to your tax affairs are required by law to be retained as follows:

Individuals, trustees and partnerships:

1. with trading or rental income: five years and 10 months after the end of the tax year
2. otherwise: 22 months after the end of the tax year.

Companies, Limited Liability Partnerships, and other corporate entities:

1. six years from the end of the accounting period.

• Although certain documents may legally belong to you, we may destroy correspondence and other documents that we store electronically or otherwise that are more than seven years old, except documents we think may be of continuing significance. You must tell us if you wish us to keep any document for any longer period.
• We may also retain a copy of your documents, if, following the termination of our client relationship, a new advisor requests the original documents.

• Electronic and other communication
  • Unless you instruct us otherwise, we may, if appropriate, communicate with you and with third parties by email or other electronic means. The recipient is responsible for virus checking emails and any attachments.
  • With electronic communication, there is a risk of non-receipt, delayed receipt, inadvertent misdirection or interception by third parties. We use virus-scanning software to reduce the risk of viruses and similar damaging items being transmitted in emails or by electronic storage devices. Nevertheless, electronic communication is not totally secure and we cannot be held responsible for damage or loss caused by viruses or for communications which are corrupted or altered after despatch. Nor can we accept any liability for problems or accidental errors relating to this means of communication, especially in relation to commercially sensitive material and the provision of banking details. These are risks you must bear in return for greater efficiency and lower costs. If you do not wish to accept these risks, please let us know and we will communicate by paper mail, other than when electronic submission is mandatory. We strongly advise obtaining verbal confirmation before making any bank transfers to account details provided in emails.

• Investment advice
  • Investment business is regulated by the Financial Services and Markets Acts 2000. If during the provision of professional services to you, you need advice on investments including insurances, we may have to refer you to someone who is authorised by the Financial Conduct Authority or licensed by a Designated Professional Body, as we are not.

• Commissions or other benefits
  • In some rare circumstances we may receive commissions and/or other benefits for introductions to other professionals or in respect of transactions which we arrange for you. If this happens, we will notify you in writing of the amount and terms of payment and receipt of any such commissions or benefits. The same will apply if the payment is made to, or the transactions are arranged by, a person or business connected with ours. The fees you would otherwise pay will be reduced by the amount of the commissions or benefits. When we reduce the fees that we would otherwise charge by the amount of commission retained, we will apply the HMRC concession which allows VAT to be calculated on the net fee after deduction of the commission.

• Clients’ money regulations
  • We may, from time to time, hold money on your behalf. The money will be held in trust in a client bank account, which is segregated from the firm’s funds.  The account will be operated, and all funds dealt with, in accordance with the ICAEW’s Clients’ Money Regulations.  All client monies will be held in an interest bearing account.  To avoid excessive administration, interest will only be paid to you if the amount earned on the balances held on your behalf exceeds £25.  If the total sum of money held on your behalf is enough to give rise to a significant amount of interest or is likely to do so, we will put the money in a designated interest-bearing client bank account and pay the interest to you.  Subject to any tax legislation the interest will be paid gross.

• Provision of Services Regulations 2009
  • Our professional indemnity insurers are Lloyds Syndicate 2003 (Axa XL) and Allianz Global Corporate & Specialty SE, Amtrust Europe Limited and Canopius (Syndicates 4444 & 1861). The territorial coverage is worldwide excluding professional business carried out from an office in the USA or Canada and excludes any action for a claim brought in any court in the USA or Canada.

21.0 Intellectual property rights

21.1  We will retain all copyright in any document prepared by us during the course of carrying out the engagement, save where the law specifically provides otherwise.

21.2 You are not permitted to use our name in any statement or document you may issue unless our prior written consent has been obtained.  The only exception to this restriction would be statements or documents that, in accordance with applicable law, are to be made public.

21.3 Nothing in the engagement letter, the schedules of services and our standard terms and conditions of business shall be construed so as to prevent Penn and Company from using techniques, expertise and ideas gained during the performance of the engagement in the furtherance of other client work. Such use must not result in a disclosure of confidential information in breach of section 4 above or an infringement of any of your intellectual property rights.

• Interpretation

22.1 If any provision of our engagement letter or terms of business is held to be void, that provision will be deemed not to form part of this contract.  In the event of any conflict between these terms of business and the engagement letter or appendices, the relevant provision in the engagement letter or schedules will take precedence.