Accountant costs? Whats fair?

monochrome1

Morning All!

Quick question, I am self employed and would always usually do my own bookkeeping and tax returns. However business is picking up leaving me less time to do it and I have also been advised I need to set up a limited company to work through for tax savings as well as protection.

My co-workers use an accountant who comes recommended and he charges £60 + Vat per month and this includes setting everything up, filing of all accounts, unlimited advice and everything else an account should come with. Then I asked a friend and she said that was far too expensive and she never paid that much having been self-employed for many years. Is this reasonable?

Option 2 is a company called Crunch Accounting who are online accountants, basically exactly the same with dedicated account managers ect. But with the added benefit of a fab online portal I can use to put all my invoices and receipts into and then be able to see how much is owed whenever I want to. I like this idea as it is as simple as a couple of clicks and I can see how well my business is doing and monitor growth easily. They charge £72 per month for this.


I have to admit, the savings that I would get from either are substantial so either seems a pretty fair price but I thought I would ask the opinion of the crowd!


Thanks in advance!

zygurat789

monochrome1 wrote: »

Morning All!

Quick question, I am self employed and would always usually do my own bookkeeping and tax returns. However business is picking up leaving me less time to do it and I have also been advised I need to set up a limited company to work through for tax savings as well as protection.

My co-workers use an accountant who comes recommended and he charges £60 + Vat per month and this includes setting everything up, filing of all accounts, unlimited advice and everything else an account should come with. Then I asked a friend and she said that was far too expensive and she never paid that much having been self-employed for many years. Is this reasonable?

Option 2 is a company called Crunch Accounting who are online accountants, basically exactly the same with dedicated account managers ect. But with the added benefit of a fab online portal I can use to put all my invoices and receipts into and then be able to see how much is owed whenever I want to. I like this idea as it is as simple as a couple of clicks and I can see how well my business is doing and monitor growth easily. They charge £72 per month for this.


I have to admit, the savings that I would get from either are substantial so either seems a pretty fair price but I thought I would ask the opinion of the crowd!


Thanks in advance!

I don't understand your problem, all-in personal service and recommended too and even though a friend, who is self-employed and, therefore, has no experience of ltds says it's too expensive you consider a more expensive option!!!
You could get all the management information you need from your own spreadsheets.

Kayalana99

I have no experience with this either but the first option sounds better to me - not the price itself but it's been recommended to you & 1 on 1 personal service, but I suppose the 2nd option sounds slightly less time consuming.

I'd like having someone I could pick up the phone and have a chat with if needed.

Mistral001

OP do not be swayed by the person who says "you paid what? You are not buying a cheap holiday abroad, but appointing what is probably your most important business supplier.


PS. I am not an accountant.

DKLS

A good accountant should easily save you their fees and more. I pay £69 a month plus VAT and that included setting up a Ltd Co, registering for VAT and the Biz bank account, and she more than justifies her fee.

Aquamania

monochrome1 wrote: »

Morning All!

Quick question, I am self employed and would always usually do my own bookkeeping and tax returns. However business is picking up leaving me less time to do it and I have also been advised I need to set up a limited company to work through for tax savings as well as protection.

My co-workers use an accountant who comes recommended and he charges £60 + Vat per month and this includes setting everything up, filing of all accounts, unlimited advice and everything else an account should come with. Then I asked a friend and she said that was far too expensive and she never paid that much having been self-employed for many years. Is this reasonable?

Option 2 is a company called Crunch Accounting who are online accountants, basically exactly the same with dedicated account managers ect. But with the added benefit of a fab online portal I can use to put all my invoices and receipts into and then be able to see how much is owed whenever I want to. I like this idea as it is as simple as a couple of clicks and I can see how well my business is doing and monitor growth easily. They charge £72 per month for this.


I have to admit, the savings that I would get from either are substantial so either seems a pretty fair price but I thought I would ask the opinion of the crowd!


Thanks in advance!

How is you doing all the work and inputting the data into what appears to be an online software programme, and paying £72 a month, cheaper than what you are doing now??? That appears to be Option 2.

Option 1, if I understand it correctly, is the accountant doing all the work for you (which you claim you now longer have the time to do anyway) and costing £60+Vat per month ... plus hopefully that accountant will provide you no end of good money/tax saving advice.

Is £60+Vat per month a reasonable charge? When you get 2 additional quotes from similar local accountants for your work, you will find out
What's more, they will probably call you in for a quick chat to get a better idea of what you really need and what they can offer you, and then you will be able to choose the one best suited to you (which may not necessarily be the cheapest when expressed as £/month)

monochrome1

Thanks, I thought this might be the case. Personally I didn't think it was expensive for what I would get/save. You always have that one friend...

DigForVictory

An accountant is not a loaf of bread - what you get for your money varies massively.

Start with the basics - can you get in touch with a named person quickly & do you get along with them? Indeed, you will be passing a lot of data to them, quite a lot of it specific to your business & some of it downright perosnal to you, so do you trust them?

Costs spike if you offload data entry to them - it's sometimes better to have a bookkeeper whose job is to punch numbers in, than pay the accountant's staff. At which point, you need to pick a bookkeeeper who you can stand who can learn from & work with the accountant. (Primary schoolyards often have intelligent women who would love to work a couple of hours a day for a modest income that is entirely their own, and accountants may have staff retiring or laid off whom they can suggest/recommend.)

Qualifications are handy, but memberships are critical. As they are your recourse if any *really* unfortunate mistakes are made.

Sort out what you want - data entry, the VAT return, the annual accounts, tax returns, corporate financial advice?

Also one accountant usually has a other clients - they may be able to make all sorts of fascinating & productive introductions.

The forms you sign have your name on - you will be expected by the tax folks to understand where the figures came from, so you would be well advised to meet before each signature to make sure you udnerstand what you are putting your name to.

Online or in person shouldn't make much difference, but when it comes to establishing that personal connection, I'd prefer a person to a phone every time. They may store my data in a cloud or wherever (who gets to store the raw paperwork?) but where do they back it up to as well?

I wouldn't stick with options one or two, I'd be shopping for recommendations from as many folks as possible!

All the best with growing into a limited company & finding an accountant who really "fits". As this should be a tailored relationship, not something off the shelf.

InsideInsurance

monochrome1 wrote: »

My co-workers use an accountant who comes recommended and he charges £60 + Vat per month and this includes setting everything up, filing of all accounts, unlimited advice and everything else an account should come with.

£60 + VAT for an accountant to do "everything" for a limited company inc "unlimited" advice is cheap in my experience.

We pay £75 + VAT monthly for a Ltd company with 2 directors which is based on us doing the basic book keeping, light advice and all returns for both directors and the company inc filing fees.

We went with them because I know a couple of others that have been with them for years. Both have had HMRC calling up wanting to question things, both referred them straight to their accountants and both never ever heard anything more about it.

On the flip side I've known others using the large budget accountants who've ended up with full HMRC investigations and in addition to having to do a lot themselves they've ended up with big bills for the investigation itself at the end of it.

A decent accountant is worth their fees. Make sure you do understand exactly what is included or not and some, particularly budget ones, may use vague terms and then hit you with unexpected bills.

Pennywise

As said above, ensure that you fully understand what they're doing for you. There's a massive "expectations gap" between clients and all professionals.

For example, for an accountant, "preparing your accounts" may mean taking your figures from your book-keeping and turning them into the P&L and Balance Sheet, with no "auditing" or checking at all.

For a client, "preparing your accounts" may mean doing or checking the book-keeping, looking for any usual expenses that may have been missed, checking for any sales invoices that havn't been paid, checking that you're on the right VAT scheme, checking whether you'd be better off as a partnership or limited company, checking that you're not missing any tricks with tax planning etc.

See the "expectations gap"?

It's like taking my car to a garage for a new tyre - I don't expect them to check my oil, brakes, lights, tuning, etc. - if I did, I'd ask them to do a full service!

So, what do you want from your accountant? Do you want them just to do the number crunching and prepare the accounts, or do you want "the full service" and want them to be proactive and be vigilant on your behalf?