A private individual who engages an accountant for personal purposes can cancel within 14 days if the contract was agreed at a distance (email, phone, video call, online signing) or away from the firm’s premises, such as at the client’s home. The right comes from the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013; if the firm never tells the client about it, the period can stretch to 12 months and work done in it may be unpaid.

Which clients count as consumers?

Regulation 4 defines a consumer as an individual acting for purposes wholly or mainly outside their trade, business, craft or profession. The firm itself is the “trader”. The test looks at the purpose of the engagement, not at who the person is:

  • Usually consumers: an employee who needs a Self Assessment return for a one off gain, a pensioner with savings and pension income, a family seeking inheritance tax planning.
  • Usually not consumers: a sole trader engaging the firm for business accounts, a partnership, a limited company and its directors acting for the company.
  • Judgement cases: an individual with a modest letting or a small side business alongside employment. Because the test is “wholly or mainly”, firms commonly treat doubtful cases as consumer engagements and issue the cancellation notice, which costs little.

The general position on terms of business is covered in engagement letters for accountants. This page deals with how the cancellation rules work in practice.

When is a contract a distance or off premises contract?

The cancellation right in regulation 29 applies only to distance and off premises contracts (regulation 27). The definitions are in regulation 5.

Type What it means for a practice
Distance contract Concluded under an organised distance sales or service provision scheme, without the firm and client being physically together, using only distance communication up to the point the contract is made. A firm that routinely takes on clients by email, phone, video call or online signing is the typical case.
Off premises contract Concluded with both parties physically present somewhere other than the firm’s business premises (the client’s home, their workplace, a café), or concluded at the office or remotely immediately after the client was personally approached away from the firm’s premises.
On premises contract Neither of the above, for example a client who meets you at your office and signs there. No statutory cancellation right arises, though the information rules in Part 2 still apply.

Business premises means immovable retail premises where the trader carries on its activity on a permanent basis. Regulations 7(4) and 27(3) exclude off premises contracts where the client pays no more than £42, which rarely helps an accountant.

How long does the cancellation period last?

For a service contract, regulation 30(2) says the period ends at the end of 14 days after the day the contract is entered into. A contract agreed on 2 March can be cancelled up to the end of 16 March.

If the firm fails to give the information on the right to cancel, regulation 31 extends it:

  • if the information is given late but within 12 months, the period ends 14 days after the client receives it;
  • otherwise it ends 12 months after the date the normal period would have ended.

Under regulation 32 the client can cancel using the model form or any other clear statement. A cancellation sent before the deadline counts even if it arrives later, and in a dispute it is for the client to show they cancelled in time.

What must the firm give the client before they sign?

Regulation 13 (distance contracts) and regulation 10 (off premises contracts) require the information in Schedule 2 before the client is bound, plus the cancellation form in Part B of Schedule 3. For an accountancy engagement the important items are:

  • the main characteristics of the service, the firm’s identity and geographical address (paragraphs (a) to (c));
  • the total price inclusive of taxes, or how it will be calculated if it cannot be fixed in advance (paragraph (f));
  • the conditions, time limit and procedure for cancelling (paragraph (l));
  • that a client who asks for work to start and then cancels must pay reasonable costs (paragraph (n));
  • where the right can be lost, the circumstances in which that happens (paragraph (o));
  • the complaint handling policy, where applicable (paragraph (k)), and the duration and termination terms (paragraph (s)).

For off premises contracts the information must be on paper or, if the client agrees, another durable medium such as email. Using the model cancellation instructions in Part A of Schedule 3, correctly filled in, counts as compliance with paragraphs (l), (m) and (n). For distance contracts, regulation 16 requires the firm to confirm the contract on a durable medium before performance begins. Under regulation 19, failing to give the cancellation information for an off premises contract is a criminal offence carrying a fine of up to level 5 on the standard scale.

Can the firm start work inside the 14 days?

Yes, but only on the client’s request. Regulation 36(1) says the trader must not begin the service before the cancellation period ends unless the consumer has made an express request, and for an off premises contract that request must be on a durable medium. Consequences under regulation 36:

  • If the client asked for an early start and then cancels, they pay an amount in proportion to what was supplied up to the time they told the firm, based on the agreed total price (or market value if that price is excessive).
  • If the firm started without a proper request, or failed to give the cancellation information or the paragraph (n) costs information, the client pays nothing for the work done in the cancellation period.
  • If the service is fully performed after a proper request, and the client acknowledged they would lose the right on full performance, the right to cancel ends. This is useful for short jobs such as a single return or a capital gains computation.

What happens if the client cancels?

Regulation 33 says cancellation ends both parties’ obligations to perform the contract. Under regulation 34 the firm must reimburse payments received without undue delay and in any event within 14 days after being told of the cancellation, using the same payment method unless the client agrees otherwise, and without charging a fee for doing so. The client remains liable only for the proportionate amount allowed by regulation 36(4).

Practical steps on cancellation: stop work, confirm the cancellation in writing, work out and explain any proportionate charge, refund the balance within the deadline, and remove any agent authorisations that were set up. If the client disputes the charge, treat it as a fee dispute and follow your complaints procedure.

How does this work in practice?

Illustration only. A partner visits a widowed client at home on 10 April and she signs an engagement letter for a fixed fee of £900 to prepare her return and advise on a property sale.

  • Done properly. The pack she signs includes the model cancellation instructions and form. She emails the next day asking the firm to start straight away and acknowledging the costs position. She cancels on 18 April after about a third of the work. She owes about £300, and any deposit above that is refunded within 14 days.
  • Done badly. The engagement letter says nothing about cancellation and work starts on a phone call. Her normal period would have ended on 24 April, so under regulation 31 it now runs until 24 April of the following year. If she cancels in September after most of the work is done, all work in the cancellation period is at the firm’s own cost, and failing to give the notice for an off premises contract is also an offence.

What mistakes do practices make?

  • Using outdated templates. The 2013 Regulations came into force on 13 June 2014 and apply to contracts entered into on or after that date. Older wording referring to 7 day or 7 working day periods reflects regimes that no longer apply.
  • Assuming an office meeting means no right. A client met at home who signs at the office immediately afterwards still has an off premises contract.
  • Accepting a verbal “go ahead”. For off premises contracts the request to start must be on a durable medium; keep the email.
  • Treating every client the same. Business clients have no statutory right to cancel, so consumer wording in their letters only confuses the position. Build the consumer test into your client onboarding process.
  • Forgetting renewals and add ons. When a consumer client agrees a new piece of work remotely, consider whether it is a new distance contract that needs its own notice. The same point arises when you agree new fees with existing clients through a fresh engagement.

Solar Protect runs fee protection schemes for accountancy and bookkeeping practices. See how our accountant schemes work or read fee protection schemes for accountants.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.