Do I 'really' need an accountant?

Twopints

Poppy9 wrote:

Don't wish to upset you but a qualified accountant earns quite a bit more than 18k:dance:

yes, but the OP (remember him ? ) doesn't.

Poppy9

Twopints wrote:

yes, but the OP (remember him ? ) doesn't.

How could I forget Fleeting glimpse even if he has forgotton us:rolleyes:

I thought you meant that paying an accountant £500 was steep if the accountant was only earning £18k pa:doh: (thats what I get for spending the day on the beach playing ball with 3 kids!) I agree paying out the equivalent of just under £10 per week for accountancy fees seems steep if you are a small trader but if he can earn double that an hour working as a plumber its money well spent if he wants more free time. On a small scale book keeping & accounting is not so difficult you can't do it yourself so you are paying really to relieve you of the hassle of doing it.

world4

Been with my accountant for 2 years now he only charges me £499.00 for the year. That includes;

Completing my annual accounts and tax returns.

Submit your accounts to the Inland Revenue and Companies House.

Deals with correspondence and Companies House statutory requirements and deals with any taxation queries.

He also contacts me once a month to see how things are going!

We turned over £350k last year and in March this year we reviewed things to see if there were any cheaper accountants our there and none came close to the £499!

If you want his details send me a Private Message.

patrick_cavanagh_2

Consider using a computer accounts program like Quicken, I have used this for over 10 years and paid nothing to accountants? The tax man is quite honest if you ask them if your not sure what you can claim back eg i just had £1200 refunded because i only caimed 40% for a new computer last year and i could actually claim 100%? You need to transfer details regularly but then the computer can give you instant profit and loss statments and many other helpful details. If you can't commit the time to keep your records up to date pay the accountant but get a few quotes from others first

hrbs

I've been an accountant for nearly 20 years and recommend all my clients to use a computerised accounts package such as Quicken/Quickbooks etc (and buy off ebay!). This enables them to be in financial control of their business. I review their accounts quarterly at VAT Return time. This has several main advantages - their VAT return is correct, they have quarterly "management accounts", business progress is discussed, existing expenditure levels/future expenditure reviewed, ongoing tax liabilities monitored etc. This regular review also keeps the year end costs to a minimum as any issues are identified and dealt with throughout the year. A typical bill is £400 (including year end accounts and SA tax return). My clients are happy with this fee level and they have the added benefit of knowing how their business stands on a day to day basis and can make informed decisions on how to develop their business and how to finance expenditure.
Accounts for most businesses shouldn't just be for tax calculation purposes.

I hope this hasn't gone too off topic!


Keith

Arfa_Daily

A couple more things about using an accountant are that they will be bang up to date with all the latest Inland Revenue legislation, and will know ways of saving you tax through claims against various business expenses that you wouldn't dream existed.

Also, having a proper firm of chartered accountants, known to your local Revenue office, prepare your accounts for you, will add a huge degree of legitimacy to the end result. If an accountant suspects that you are on the fiddle, he now has a legal obligation to report it, or face prosecution himself. This means that if you have had an accountant prepare your accounts, it is basically a waste of time for the Revenue to run an investigation on you, as it's likely to turn up nothing.

Finally, if you do get investigated, it is a huge help to have your accountant on board, and you can insure with him for this and the time he will have to spend, for about 30 quid a year extra.

Arfa

lowsonig

If your water tank bursts and you call a plumber you pay him to fix it, plumbers charge about £50 per hour plus a call out fee plus materials. If you pay an accountant or any other tradesman or professional person your paying for what they can do, know and more importantly your paying for their time. Paying for any work to be done by a professional should be ecconomical. i.e. You pay an accountant £500 and they should be able to justify their fee by legally saving you as much as possible but more importantly saving you time.
A little fantasy story
A plumber has two things to do. His tax return, which he usually spends a weekend doing, and it's his anniversary. His wife insists that they go away for a long weekend, but his tax return is due in. He decides he needs a bit of time off and that spending time with his wife is more important than appeasing Mr Brown for once, so books the long weekend away. Before he goes he drops into his accountant with all the documentation required. £500! The plumber thinks he would have to work 10 extra chargable hours, but really he's spending 10 hours less on unchargable time i.e a weekend of paper work.
The plumber has a great weekend with his wife and the even better news is that the accountant has managed to reduce his tax bill by £2500 as he wasn't claiming for X, Y and Z. Not only has the accountant saved the plumber his fee, he's paid for his weekend away!

P.S. I'm not a plumber or an accountant!

NeilW

Arfa_Daily wrote:

A couple more things about using an accountant are that they will be bang up to date with all the latest Inland Revenue legislation, and will know ways of saving you tax through claims against various business expenses that you wouldn't dream existed.

Alternatively you can ask here, or on loads of other forums. It is a myth that there are loads of ways of saving tax that only the higher eschelons of the accounting profession know about. Everything you need to know about tax are published on the Internet in the Revenue's own tax manuals, including how the Revenue views things.

Arfa_Daily wrote:

Also, having a proper firm of chartered accountants, known to your local Revenue office, prepare your accounts for you, will add a huge degree of legitimacy to the end result. ... This means that if you have had an accountant prepare your accounts, it is basically a waste of time for the Revenue to run an investigation on you, as it's likely to turn up nothing.

Again a perennial myth peddled by the accoutancy profession eager to protect their inflated fees. The Revenue have centralised regional centres staffed with relatively low grade individuals who push buttons on computers. You are just as likely to get investigated regardless of who does your accounts. There are three reasons for investigation - your income isn't high enough for what you are doing, your costs are higher than average for what you are doing or you got selected by random on the computer. It's very rare for a real person to get involved these days unless a computer program has gone beep somewhere first.

Arfa_Daily wrote:

Finally, if you do get investigated, it is a huge help to have your accountant on board, and you can insure with him for this and the time he will have to spend, for about 30 quid a year extra..

Taking investigation insurance out is a must in today's environment and this is sensible advice.

However most accountants I've dealt with are hopeless at dealing with the Revenue on an investigation. They are far too soft with them. It is better to take investigation insurance out with somebody who has an incentive to close the Revenue down as quickly as possible and who the Revenue know is a Rottweiller.

NeilW

cosyc

Here's a novel way, just ask the Inland Revenue for help.

They run morning courses in their offices on how to keep records and what expenses you can claim for and then a follow up course on how to complete a self employed tax return and all for FREE!!! Ring your local office and they will tell you where the nearest course is. Or send your wife/husband/partner instead.

If you are still struggling ask for an appointment with a member of their Business Support team who will help you put your figures in the right boxes.

Another way if you do it online, it does the calculating for you if you miss the sept deadline.

cosyc

Forgot to mention if you join the federation of small businesses (FSB) they will also give you legal help if you are investigated.