OUTSTANDING FREIGHT CLAIM AND WITHOLDING INVOICES

Michael Ludwig

Well-Known Member
#21
Quite often you find when a customer has to go thru the claim process, they discover the fault was actually theirs anyways. TBH, it's pretty hard to screw up a load of anything these days, unless you had an accident or your driver was a complete moron.
When we sign contracts, we strike out the paragraph(s) pertaining to off-setting. These types of contracts are usually the domain of load brokers who actually have no stake in the claim process to begin with. Regardless, if they don't like it, then we don't work for them.
 

Michael Ludwig

Well-Known Member
#22
Just curious, because I'm not an accountant, but if you contra someone's account, how do you deal with the taxes?
Maybe your customer is committing tax fraud ... LOL
 
#23
Just curious, because I'm not an accountant, but if you contra someone's account, how do you deal with the taxes?
Maybe your customer is committing tax fraud ... LOL
I'm also not an accountant... which might be why I don't understand your question... haahaa...

Our customer took the exact value of the load from a cheque they sent us for services... Then I got the exact same amount from my insurance company... It was a wash... like a short-term interest free loan provided by me... haahaaa....

And if my customer is committing tax fraud, then dammit, I'm raising my rates! haahaa..
 

theman

Well-Known Member
#24
If you signed a contract, I'd assume you read it. So if you say you're going to accept a customer doing this, then you have to do it ... regardless of whether it's legal or not. But when I've come across it in contracts, we've tried to negotiate it out and if we couldn't we would just have to make a judgement call on whether we think the customer is acting in good faith or not.

Contracts are for 'what ifs' where man-to-man can't come up with an arrangement ... day to day it is not something that is referred to.
 

Michael Ludwig

Well-Known Member
#25
Right, I got that. Now, suppose that load was from point to point in Ontario. Part of that offset should have been for the transportation cost, and the other part should have been for the sale of the goods to which HST is due on both. Regardless of whether the shingles were written off or not, you bought them. You owe HST on the sale, and the shipper needs to remit that HST. So my question is, how was the tax liability accounted for?
Remember, in this country you can get away with almost anything except not paying your taxes. The taxman is a cold-hearted SOB ... LOL
 

theman

Well-Known Member
#26
That's a good question. Good thing is that my claims ratio on things I have handled over the years (outside of the time I did produce) is around 1 in 1000, so even though I've been in it for a long time, I can't say I've been involved in 'mountains' of claims. Thank goodness.
 

MikeJr

Moderator
Staff member
#28
Taxes on claims - Somehow I understood that the claimant could not include tax in a damage claim. Do they not just claim them as input tax credits in order to recoup the expense? Where's my friend at Marsh when you need him? Patrick, hook us up!

You guessed it, I'm not in accounting either - nor am I considering a move in that direction.

Keep well,
Mike
 

MikeJr

Moderator
Staff member
#30
Thought so. 2015 we managed (through working with the right carriers) a 1 in 486 claims ratio, so yes we have had to explain the tax to claimants. Of course we're in intermediary, do not pick sides and endeavour as always to ensure that no party is acting fraudulently or in bad faith.

Thanks lowmiler!

Keep well,
Mike
 

htcollections

Suspended Member
#32
CRA has the habit at times to ensure carriers charge a RESUPPLY. best off to pay it so the nice auditors later in time don't assess it. Always verify HST numbers on line and print the verification. You are responsible for verification and if you pay someone without a proper hst number, CRA can deduct that from your ITCs.
 

lowmiler88

Site Supporter
#33
We have a great claims ratio when it is on our trucks (.0002 %) but when you ship 2 to 3 trailer loads a day of LTL not on your trucks it's impossible not to have 2 or 3 a week. I would suggest that if someone is charging tax on a claim they might be keeping that money for themselves not everyone follows the rules.
 

loaders

Site Supporter
#34
The worst type of claim to get settled, is the one whose value falls below the carriers deductible. The approx. $1500 ones where the carrier refuses to investigate, and his insurer won't respond because the carrier hasn't reported it.
It wouldn't surprise me if this was the type of situation that results in a shipper offsetting an invoice.
 

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