Finding Your Ideal Financial Partner:
Finding the ideal accountant for your firm might not be as easy as it looks. The UK’s economy comprises different industries and businesses, and with ever-evolving technology, routine accounting tasks are getting less complicated. Good accounting firms and experts have also moved up with the changes and evolved significantly with time.
The finance services can be availed by big businesses, welfare organisations, charity institutes, public bodies, private bodies, businesses providing different services, freelancers, small businesses, etc.
You may encounter major differences in services from one firm to another, and charges vary greatly, too. Therefore, deciding just by looking at charges can be difficult. Here we are with some guidance and tips about what you should look for in the perfect accountant for your individual and business needs.
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What is Important for Hiring an Accountant?
When running a new or established business, the accounting tasks can take lots of your time. If you keep busy doing the paperwork, important tasks like working on business growth can be difficult.
Even if you are an accountant, you already know that the business requires an expert and full concentration to get the accountancy job done beyond bookkeeping. Here are a few reasons for hiring an accountant:
Tax Efficiency:
A professional accountancy service provider such as Accounting Firm UK can help you handle tax matters error-free. Our experts understand the nature of business and the challenges that individuals or small business owners face.
Our job is to stay informed and up-to-date about accounting, tax and miscellaneous finance issues in your field. Tax legislation changes with time, and a competent accountant will help you stay informed and assist you in complying with new regulations and laws.
Helps in Claiming Expenses:
The accountant helps in claiming various expense claims for tax purposes. They guide you in what type of expenses you can legally claim. Likewise, how to finance your car or home and the tax implications for your spouse or other relevant people.
Lessen Admin Burden:
The accountants provide various services, including consulting services on legal structure, establishing new companies, and helping submit and prepare the company’s annual tax, VAT, Self-assessment tax returns, corporation tax, etc. Many accounting firms also provide services as limited company registered. Address services and payroll services.
Reference of Accountants:
When you are asked to provide an accountant reference with your finance details, you need the accountant’s services. The relevant department verifies details about the business, including financial establishment, when it was established, and the revenue you are generating from it.
Likewise, you might require an accountant reference while applying for a mortgage or house finance. Sometimes, clients also demand accountant references.
Ease of Mind:
The accountant services provide you peace of mind by reducing error chances on tax returns and maintaining other financial records. There is no defence when the companies deal with HRMC and the relevant Companies House. Therefore, knowing that your accounts have been dealt with professionally gives you ease of mind. It also reduces the chances of getting investigated by HMRC.
Supports at Time of Investigation by HMRC:
In case you are investigated by HRMC, the accountant on your side can prepare a strong case to present in front of the tax inspector. As the accountant has been working with your firm for a while, they know all about your business’s ups and downs and can better defend the case.
The accountant might also know the answer to expected questions and help you prepare them with additional business information.
Types of Accountants:
As we said earlier, the accounting firms’ and accountants’ services can vary greatly based on their services and expertise. Tax legislation is becoming more complex day by day. Therefore, every business and individual is trying to choose a specialist accountant for their firm. Let’s have a look at different types of accountants in the UK.
Accountants Providing Services for Big Businesses:
Accountants working under big accounting firms might not be the right choice for small business. The matter is not just the fee. Big firms work with big companies and provide services related to employee benefits, pensions, and finance advisory apart from multiple tax jurisdictions.
On the contrary, small businesses and start-ups seek advice on establishing the company structure, the most efficient way to pay taxes, employing the team and dealing with claimable business matters.
Local Accountants:
Local or high street accountants are the ones who provide accountancy services in their areas based on customers and their specific needs. The clients are usually a mix of medium and small size businesses, contractors and freelancers.
High Street Accountants usually use online bookkeeping services, while some work manually. The local accountant services include tax returns submission, bookkeeping, year-end accounts, payroll services, corporation tax, and VAT returns.
Online Accounting Services:
The online accountancy services providers are the latest mode of managing financial issues of businesses. It is also cost-effective for managing and running business tax and finance affairs. Accounting-related services allow businesses to automate finance tasks and improve efficiency and speed.
Most online accountancy services use copyright software to differentiate offering services that meet the needs of the businesses smoothly. Many accounting services can also be availed through different mobile apps to boost the service while offering flexibility.
Accountants Providing Services for Small Businesses:
Several accountants are providing online services to small businesses. The trend is emerging pretty fast in the UK. Small businesses have become a significant part of the economy of the UK; therefore, they need accountancy consultancy especially tailored to meet their business needs.
Local Accountants or Online?
As a small business runner, freelancer or contractor, the best choice that can be made is between choosing local accountants or online accountancy service providers. Let’s have a look at the benefits and drawbacks of both:
Local Accountants / High Street Accountants:
Benefits:
- Face-to-face contact can be easily arranged if you are choosing local accountant services
- You will have an idea about the reputation of the firm. Moreover, you can ask for references or recommendations from local businesses.
- The High Street Accountants can also offer online services for regular accounting tasks.
Drawbacks:
- The services might not be seamless when dealing with local accounting firms as you might have to deal with people with different mind-set.
- The services are restricted to the office.
- The accountants might need to be more expert in dealing with all business issues.
Online Accounting Services:
Benefits:
- The companies can enjoy a variety of service levels, and the pricing structure is easy to understand.
- You will get services from a dedicated accounts manager who can comply with HMRC and Company policies for small businesses.
- You can easily access accounts around the clock.
- The accounting software is easy to use, and you can complete various tasks efficiently. For instance, calculating take-home pay, creating invoices, uploading receipts, formatting accounts for VAT, self-assessment tax and corporation tax.
- You can also meet with them through Skype or any flexible video meeting option.
Drawbacks:
- Face-to-face meetings are restricted
- The online accounting services are not a great choice for large businesses with complex finance needs.
Mode of Charging Fee:
The mode of charging fees might vary as the services of local and online accountants differ. Let’s have a look:
How Do Local Accountants Charge Fees?
The charges of high street accountants can be a mix of monthly and hourly rates for the services they offer. The hourly rates also include charges to consult the designated accountant on a phone call for advice. Therefore, you should have a strong reason to make the call.
Sometimes, the local accountants’ fee structure is based on the services that your small business might not need. Some firms base fee structure on the clients’ revenue (ignoring the factor of how much work they might have to do).
Local accountants often charge the local small businesses an average of two thousand pounds.
How Do Online Accountants Charge Fee?
Many online accounting services provide a variety of finance services on different levels. Therefore, you can choose the package that fits your needs and budget. Online accounting firms usually charge per month, but it can consist of any services that are not included in your chosen package in detail.
The monthly charge mode is more transparent as you can estimate the total annual fee with confidence. At Accounting Firm UK, the fees depend on the business type, size, and services required.
How Do You Make the Right Choice?
Once you have decided when and how to start your business, you can move to the next step: choosing the right type of accountant for your business.
Once you get the accountant on board, they will have a better understanding of the business and take care of administrative and accounting work, including registering for VAT and establishing your limited firm. You might also know about the annual charges you are going to pay for the availed services.
Identify Your Needs:
Once you have an idea how your business will operate or is operating you can choose what exactly your accountancy needs are and what packages suit you best.
If you know how to account or can do error-free finance-related tasks such as VAT returns submission and annual year-end accounts, then hiring a specialist for it can be useless. Simple accounting services can be your right choice and prove to be cost-effective.
However, suppose you are not an expert or feel more satisfied with the help of an expert. In that case, it is better to hire a competent accountant who can provide comprehensive accountancy services. Hiring an expert is also suitable when you need assistance submitting RTI, etc., for employees’ taxes.
Understand Your Assistance Needs:
While you hire professional services, you should be assured that the accountants have a comprehensive understanding of your business and your business goals.
It means you need specialised accountants’ services comprising business expenses, VAT registration options, responsibilities of directors and benefits you can avail as owner.
Moreover, consider your working hours, if you are working on receipts outside normal working time then you need an online resource accessible 24/7.
You should know the point of communication with the assigned accountant. You will be assigned a dedicated accountant or not? Will you be charged for every call, or is it included in the package?
Talk with Previous Clients:
It is important to be 100% sure you have chosen the right accountant. You should know that the services they offer will cover our accountancy needs. Therefore, talk to other businesses about their reputation and credibility.
Seek testimonials and references from the previous clients and check;
- Whether they are genuine
- Whether they provide helpful online resources
- Check their social accounts to see how they engage and interact with people.
Define Your Budget:
It is important to define your budget and the precise support you need from your accountant. It will help you find a competent person and quality services and competitive prices.
Shifting Your Accounting Service
If you are changing accountants, you should not get tired in a quest apart from finding a better person for the next service. Ensure you have tied up any loose ends that make you shift from the first person.
Moreover, keep a small print of the contract with yourself with the clauses describing the rules of shifting from one accountant to another. It might also include cancellation fees. Be honest when you are switching accountants. It can be your outgrown needs, change or closure of business, etc.
You can also mention that you are not satisfied with their services; however, try to be diplomatic and fulfil contract requirements from your side. Remember that you need their assistance to hand over accounts to the new accounting firm seamlessly.
Here, you should also consider other factors; for instance, make sure everything is clear. It helps with minimum inconvenience for you and your businesses.
Proper Timing to Switch Accountant:
The most appropriate time to switch accountants is by the end of the financial year. Ensure you have developed a mutual understanding with new and previous accountants on who will work on which part of your finance paperwork. Likewise, be clear on the charges you have to pay respectively.
The new accountant might also charge you for some of the work they have to do again; the previous accountant already did that.
How Does Accountant Switching Work?
Once you have selected the new accountant, inform the one currently working with you and ask for the transfer. Other than signing a couple of papers, you have to do nothing.
The new accountant will send a “Professional Clearance Letter” letter to the already hired expert. The letter asks for clearance and whether there are any factors to decline or reject your business, such as conflict of interest, business nature, etc. Once it gets the okay signal, the new accountant will ask for the documents such as;
The Income, corporate and relevant tax files, returns and schedules that are submitted for the business from the last 6 years. It also includes every computation of relevant matters.
- The recently completed trial balance and company accounts.
- Tax reference and district
- Any tax loss details
- Assets valuations and costs that you hold
- Details of any meeting with HMRC
- Any relevant tax information.
The new accountant will also seek a letter from the business owner to release the above-mentioned information from an already service-providing accountancy firm.
If your current accountant is certified or chartered, they will provide the details in a set tie. Even if they are not, they are bound to provide the requested details quickly.
The outgoing accountant can charge you a fee for these services. However, it is not more than an hour, so negotiate the cost properly.
Transferring one accountant to another is considered successful once your new accountant gets all the necessary details. The new accountancy service provider will now give you a few forms to complete the details. It will include a statement form that informs HRMC that they are your new accountancy service provider.
Disclaimer: The information provided on AccountingFirms.co.uk is for informational purposes only and should not be considered as financial advice. Always consult with a professional accountant to ensure compliance with UK laws and regulations.