What’s the REAL cost?
Another interesting one today.
One of our customers had a discussion with us late last year with regard to a transaction they were proposing to undertake. We scoped out the work and gave them a price to provide them with some advice regarding the likely taxation implications of the transaction. Suffice to say they thought the price we quoted was too high (it was well under $1,000) and decided not to engage us.
Well, they proceeded with the transaction and went to contract which was duly signed and such. All good. No involvement from us – despite our offer.
Trouble was, as a consequence of not spending the less than $1,000 for our advice, they have now incurred an additional tax bill which we estimate will be in the realm of $30-40,000. Our advice would have resulted in their tax bill being reduced to $0.
Next time your adviser recommends that they undertake some work relating to a transaction you are contemplating, think about the value that they can add to the outcome rather than focussing on the cost. You’ll be pleased you did.
Unlike our customer who now has plenty of time to deal with the consequences of their decision.