accountant charges

moneytroll

Hi,
I was wondering whether my accountant is charging me too much.
I am self-employed. I put all my financial records (income, expenses etc) into a spreadsheet and send it to my accountant every year. The spreadsheet even calculates everything. He then puts it all into the tax return and sends it off to IR. He charges almost £600 per year flat fee. I don't really know how much time it involves to copy the data from spreadsheet into the tax return as I haven't tried it myself but I imagine not that much so I wonder whether his fee might be a little too high. Or whether I really need an accountant. The reason why I am wary doing the tax return myself is that i am not always sure things I can deduct and things I can't + occasionally I ask advice regarding some matters to make sure I don't get into trouble.
Any advice in regards to what the typical charges should be in accordance with my situation?
thanks

Bean_Counter

It's difficult to give a definitive answer without knowing the complexity of your affairs, but given that you are self-employed and having to work out from your transactions what is allowable for tax and what is not (and a lot more besides), I would say the charges are reasonable.

You also have that piece of mind that a professional is handling your affairs in the case of a HMRC investigation and that they are likely to be substantially correct.

Cook_County

Don't forget the value you are getting is not the spreadsheet copying task, what you are buying is actually his knowledge/experience so that you both save money and minimise risk.

dunstonh

I pay £559 and that is for full accounts to satisfy FSA requirements. That covers me, my wife and the business. Data is supplied to accountant with categories to help but in paper form.

So, based on that alone it would appear you are paying about the same. Your location will have a lot to do with it. Being in East Anglia, things are cheaper out here. I would expect a town based accountant to charge a lot more.

Also, don't forget that you are paying for the skills and knowledge of the accountant. I would rather pay a little more for a good accountant than less for one that is less knowledgeable and efficient.

longforgotten

A good accountant will not take your spreadsheet at face value. They will have it checked, need back up paperwork, check if everything you think is allowable actually is etc etc

So its not just posting the information into the computer, there's more to it than that.

I know cases where people have obviously taken ages to write up books and at the end of the day its a waste of their time. It would be quicker to do their accounts if they had done nothing at all. The books aren't written up well, don't balance, wrong figures etc yet they are under the impression they've done a wonderful job !

owen_cash

Just had my bill from accountant and he phoned the inland revenue twice and has charged me £75 a phone call. Is that normal? he never mentioned that it would cost that much?

Bean_Counter

owen_cash wrote: »

Just had my bill from accountant and he phoned the inland revenue twice and has charged me £75 a phone call. Is that normal? he never mentioned that it would cost that much?

It depends on what he was calling about. I guess that the charge would include reading up your file beforehand, looking anything up before the call, making the call, taking notes after the call and writing to you with the outcome.

£75 must be, what, half an hour of chargeable time? Seems within the ball park to me.

inmypocketnottheirs

I run a small limited company, with say around 100 invoices p.a. My accountant charges me £650 a year which includes annual accounts, corporation tax filing and personal tax.

I don't think the OP is being over charged, but perhaps they are doing more work than they have to.

WHA

I am 90% confident that you could reduce your accountants fees if you used a proper book-keeping package rather than a spreadsheet. You can even get a free simple cash book program (https://www.vtsoftware.co.uk) or a free web-based ledger system (https://www.winweb.co.uk) so cost should not be an issue. Spreadsheets are the bane of my life - never once in 25years have I been given a spreadsheet that doesn't contain errors - just this morning I spent 3 hours on a job that would have taken just an hour but for the mistakes that take a long time to find and that was from an IT consultant! Following through transactions in an often jumbled mess of figures from the original input, attempting to trace through to the end result, takes an incredible amount of time. It is not just a matter of setting it up right in the first place, it is all too easy to mistakenly enter a figure in a cell as a "label" rather than as a number, so it doesn't get included in the totals, people use +a1+a2 etc rather than @sum(A1..A2), so new rows and columns don't get added into the total, and there are no built in checks and balances to make sure the numbers make sense - all these basics are built in to proper packages. You need to talk to your accountant and sort out a better way of book-keeping for you both - not only will you save accountants fees, once it is set up, you'll find that you save time doing the books as well.