Do I have to disclose my Contractor Invoices?

by Readers Question

14:39 PM, 4th May 2016
About 3 years ago

Do I have to disclose my Contractor Invoices?

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Do I have to disclose my Contractor Invoices?

A client, who I manage a property for, has requested a copy of my contractors direct invoices to me for her accountant.dislosure

I advised her the statements I provide are sufficient for her accountant and for tax purposes as they detail the cost she has been charged for the repairs. They are given from my limited company and have the registered company number on them.

My contractors invoices are addressed to me, are for my business purposes and are of no relevance to her whatsoever. What if I had done the work myself and there was no third party invoice?

In the past I have been burned with clients contacting my contractors directly and self managing going forward, benefiting from the relationship I had built up with the contractor. I cannot blame the contractor, as the client who approached them offered to pay more than my negotiated rates with them as they were saving on the management fee! I only found out as he accidentally invoiced me for a job!

I have now found new contractors and work closely with them and sure it would not be a problem going forward, but I feel strong armed into providing my invoices by using the excuse “my accountant needs them”.

Can I refuse? How far can I stand my ground? Surely documents relating to my business can be kept confidential?

Many thanks

Hemi



Comments

Gary Nock

21:31 PM, 4th May 2016
About 3 years ago

Mmm. Looks like client is trying to see if there is any "mark up" on what you are charged and what you charge the client. If the work done falls within your normal contracted remit then there should'nt be any mark up. Your client already pays you to manage that through the management fee. However if it is work outside of that like organising a re-decoration between tenancies then its normal to advise the client of any additional costs. Some managing agents have a "management arrangement"that allows them to deduct a blanket percentage either 10 or 15 per cent from the invoice for "bulk discount" on work provided but the original invoice remains the same. It seems that if you are marking up then if you provide the contractor invoices the client will see it. If you don't they will assume you are. A no win situation really.

Gary Nock

21:32 PM, 4th May 2016
About 3 years ago

But you are not obliged to provide the original invoices.

Hemi Tanna

21:55 PM, 4th May 2016
About 3 years ago

Reply to the comment left by "Gary Nock" at "04/05/2016 - 21:32":

Hi Gary, thanks your comments have made sense and you've got the mail on the head. Problem is I know realistically I'm not obliged, but its more about looking suspicious when I'm not being so. For example, my contractors invoice me in bulk for all work done in a month, so the invoice has her property work, but also other work done which is even less relevant to her and surely at some point I can point out these are documents pertaining to my business and perhaps use the above example to explain why I can't provide them to her? It's a tough one and I am must not sure how far too "put my foot down".

steve p

2:30 AM, 5th May 2016
About 3 years ago

Why not just provide the invoices with the contractor details blacked out and other property work, you can black out as much as you want, just explain why so much is blocked out, but at least shows you are being honest and not charging your client any more than the contractor charges you.

Hemi Tanna

6:20 AM, 5th May 2016
About 3 years ago

Reply to the comment left by "steve p" at "05/05/2016 - 02:30":

Thanks Steve, is more about the fact previously I've been burned by contractors being contacted directly by a client and then client leaving to self manage because they used my contractors direct instead. I have to admit, I feel a bit like my hand is being forced by my client, for no reason, and I don't want to give in to it!

Romain Garcin

8:59 AM, 5th May 2016
About 3 years ago

You cannot make secret profits by applying a markup without your client's knowledge and approval.
How can a client verify this? I suppose that a request to audit you is reasonable even if you do not have to accept.
Of course, if you refuse you run the risk of losing the client.

In any case, I think that it is also reasonable for clients to ask who you use as contractors to work their properties. Again, if you refuse to answer you will probably raise many red flags.

I don't think that hiding the contractors to avoid clients contacting them directly is a valid reason: If a client has decided to self-manage he will find his own contractors anyway. For you the key, I think, is that it means that the client has decided that your service was not valuable enough.

Mark Lynham

9:14 AM, 5th May 2016
About 3 years ago

I really dont see the problem in the landlord asking for this, i always send them out with my monthly statements to landlords.

Rachel Hodge

9:17 AM, 5th May 2016
About 3 years ago

Why the secrecy? If the works are outside your normal management scope then a 10-15% mark-up would be reasonable but you should have been clear about that arrangement and the client should have the option to manage the works themselves. All sounds very shady to me and like you have something to hide. What mark-up did you add?

Yvette Newbury

9:22 AM, 5th May 2016
About 3 years ago

If this is important to you, then you should include it in your terms and conditions that your client would sign ie. a clause stating that you either make a mark up on the contractor charges (as letting agents do) or that you can supply copy invoices, with non-relevant details blacked out eg. name of company. However if the person is hell bent on contacting the contractor direct and by-passing you they only have to ask the contractor when they are at the property for their contact details. Again this is something you can specify in writing to your contractor when they go to work there, no direct work. Otherwise I agree with others that it sounds as if you are trying to hide something.

Adrian Jones

9:24 AM, 5th May 2016
About 3 years ago

Out of interest, are you charging the landlord the same the contractor charges you for the work?

What is your management fee for arranging work?

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