You may withdraw residual client balances of £500 or less on any one client matter from a client account provided:
- the balance is paid to a charity of your choice
- you have taken reasonable steps to return the money to the rightful owner. The reasonableness of such steps will depend on:
- the age of the residual balance;
- the amount of the residual balance;
- if you have access to the client's most up to date contact details;
- if not, the costs associated with tracing your client.
We expect you to make more intensive efforts to locate the rightful owner for larger or more recent residual balances or for balances where more details are held about the client.
- you record the steps taken to return the money to the rightful owner and retain those records, together with all relevant documentation for at least six years;
- you keep appropriate accounting records, including:
- a central register which records the name of the rightful owner on whose behalf the money was held, the amount, name of the recipient charity (and their charity number) and the date of the payment; and
- all receipts from the charity and confirmation of any indemnity provided against any legitimate claim subsequently made for the sum they have received.
- you do not deduct from the residual balance any costs incurred in attempting to trace or communicate with the rightful owner.
The records referred to in points 3 and 4 above may be requested by your reporting accountant who will look at whether you have followed these prescribed circumstances.
For amounts over £500 you will need our authority before removing this money from the client account. Please use our application form.