4 min read

Do I need an accountant for my business?

Accountants offer a wide range of services and can help you at any stage, from start-up to business growth. This article gives you an overview on the benefits of a business using the services of a professional accountant.

Why do I need an accountant?

If you are just starting a business, your accountant will take the form of another business adviser. They will be able to give advice on your business plan and the tax issues of registering a new business. They will help you decide which business structure is most suitable for you.

Some accountants offer bookkeeping services, but if they don’t or if you wish to handle this yourself, you can get help with setting up manual or computerised bookkeeping systems. You may need an accountant to help you on things like whether it is necessary to register for VAT or PAYE and the procedures involved.

You can also seek help with budgeting and forecasting cash flow from an accountant as well as credit control and just general financial advice. They can offer you up-to-date information on any general or legal enquiries.

How will an accountant help me?

Accountants can offer a range of services from annual accounts preparation to a full management service. They can help you organise your finances, provide guidance in record keeping and even provide training in your accounting software (if they are familiar with the software you use).

They are likely to have worked with other businesses within your field so may also be able to offer you day-to-day advice on running and developing your business, such as charging suitable prices (which are competitive) and keeping control of your costs.

They will also be aware of the latest tax laws, regulations and deadlines and can advise on how to run your business in the most tax efficient way, ensuring you don’t pay more than you need to.

They can also take care of all the paperwork and legislative requirements when you employ staff. Simply put, accountants can take all of the hassle away from you and allow you to focus on what you enjoy, running your business!

How much help do I need?

The amount of support required from an accountant will vary from individual to individual. The carousel below shows some of the ways an accountant can assist a small business owner. 

Year-end accounts

Some businesses may require an accountant to prepare their year-end accounts. This would involve the business doing its own bookkeeping during the period and preparing its own returns such as VAT and PAYE. The accontant would prepare the accounts using the information provided by the business. Preparing accounts may also include filing these and calculation any corporation tax liability. 

Regular returns

Some businesses may require the accountant to prepare its VAT returns (usually quarterly) and deal with the submissions of these returns to HMRC. An accountant may also offer payroll services and deal with processing the wages for the business and submitting the PAYE and national insurance returns to HMRC and produce the relevant payroll forms.

Bookkeeping / Management accounts

Some businesses may require more regular support. An accountant can provide bookkeeping services i.e. process all of your purchase and sales invoices and bank receipts and payments. Management accounts may also be useful which will allow you to view reports on different areas of the business on a regular basis to aid the business owner to have an understanding of the financial performance of the business.

Strategic advice

Some businesses may require its accountant to offer strategic advice in terms of financial arrangements, business development and networking and offer HR support.

Full package

Some businesses may require their accountant to offer a full service. This would involve bookkeeping (regular returns such as VAT and PAYE) and all associated compliance, year-end accounts plus corporation tax returns and personal tax returns for the directors. This may also include regular meetings to review the performance and position of the business.
Year-end accounts

Some businesses may require an accountant to prepare their year-end accounts. This would involve the business doing its own bookkeeping during the period and preparing its own returns such as VAT and PAYE. The accontant would prepare the accounts using the information provided by the business. Preparing accounts may also include filing these and calculation any corporation tax liability. 

Regular returns

Some businesses may require the accountant to prepare its VAT returns (usually quarterly) and deal with the submissions of these returns to HMRC. An accountant may also offer payroll services and deal with processing the wages for the business and submitting the PAYE and national insurance returns to HMRC and produce the relevant payroll forms.

Bookkeeping / Management accounts

Some businesses may require more regular support. An accountant can provide bookkeeping services i.e. process all of your purchase and sales invoices and bank receipts and payments. Management accounts may also be useful which will allow you to view reports on different areas of the business on a regular basis to aid the business owner to have an understanding of the financial performance of the business.

Strategic advice

Some businesses may require its accountant to offer strategic advice in terms of financial arrangements, business development and networking and offer HR support.

Full package

Some businesses may require their accountant to offer a full service. This would involve bookkeeping (regular returns such as VAT and PAYE) and all associated compliance, year-end accounts plus corporation tax returns and personal tax returns for the directors. This may also include regular meetings to review the performance and position of the business.

How much do accountants charge?

In terms of actual costs, these days most accountants will charge a fixed fee.

A sole trader could expect to pay from £20 – £50 per month upwards – costs will depend on the level of services required and the areas in which you need assistance.

An initial consultation (which is usually free) should identify the areas that you will need an accountant for and the budgeted monthly or annual cost. Accountants may offer tailored training, which means that as you become more confident you can carry out some of the tasks that they have traditionally completed.

To find one near you, use our interactive find an accountant or bookkeeper service.

 

Can I manage without an accountant?

Some small business owners decide to take on certain aspects of their financial duties themselves. This could include accounts preparation, bookkeeping, VAT returns or filing personal tax returns. They may then use an accountant for areas they are not able to do, either due to a lack of understanding or time restrictions.

The degree of support required will vary from person to person. Most accountants offer an initial consultation free of charge and it is certainly advisable to make use of this service. During the consultation the accountant will take the time to discuss and understand your requirements and how they can best help you and your business.