Professional fees sharing optimum ratio

Hello,

 

There is a CA firm known as 'ABC Enterprises' which is an established firm since the past 25 years. It specialises in Income Tax of which it has about 500 clients. However, from the same clients, there are also about 20 of them which are liable to VAT Audit. Since the CA firm's partners and employees do not specialise in Sales Tax(VAT), they have an arrangement with a CA who has expert knowledge in VAT say whose name is 'Sachin'. The arrangement is such that CA Sachin uses the ABC EnterprisesFirm's Infrastructure & Staff. One partner from ABC Enterprises signs the VAT Audit Report. All CA Sachin does it he visits their office, directs the staff how to do the same and responsibily gets the VAT audit done. His work is so perfect that the CA firm need not even check the same but they can do if they want.

 

If CA Sachin demands his fee as a % of VAT Audit Fees, how much should it be? What would be optimum as per you? Like 70-30/60-40/50-50/40-60/30-70 etc.?

Replies (2)

40-60

Since he uses the name of the firm and the risk is borne by the firms partner apart from using the firms resources for free..

Originally posted by : Karan Teli

40-60

Since he uses the name of the firm and the risk is borne by the firms partner apart from using the firms resources for free..


You mean 40% to CA Sachin and 60% to the firm ABC Enterprises?

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