do I really need an accountant?

[QuatroFromageo]

I wanted to know if any of you have accountants to do your books and if the benefits outweigh the costs?
I keep being recommended SJD contractor accountants who are meant to be the biggest and the best for small business and freelancers.
Slightly worried that they might have the biggest price tag too!


But whether I go with a big firm or a personal accountant, I don't know if they can really offer me anything I can't do myself.
If you lot could share your experience of accountants I'd be grateful.
​

 

[trev]

I liken this question to a DIYer coming on here and saying "I'm a complete novice but I'm going to change my CU myself, what do I need to look out for?"
Yes there's nothing to stop you doing your own self assessment form every year (and there are probably millions out there who do their own, fair play to them) but then again there's nothing to stop you pulling your own teeth out but I'm sure you'd rather visit a dentist. There are loads of small accountancy practices out there who will do what you need for a pre agreed fee and chances are they'll know more about what you can and can't claim than you or I.

 

[Rockingit]

All depends on where you're at and how much you know about the tax system. If you are a sole trader then there's not a formal need to use an accountant, but if you're a Ltd then you have to get your books audited regardless.

I do all my accounts, and my wifes, and it's not half as hard as people make out. I'm VAT registered as well, but then if you get some decent bookeeping software it's normally just a push-button exercise anyway. Only if you get into a real predicament can an accountant really justify their money.

Keeping good records as you go is half the battle I find.

 

[oldtimer]

It depends some on the forum say yes others say no me I do my own but I am no VAT registered so I manage it what I will say whether you have or have not an accountant you need to keep good records and for me that means filling in my spreadsheets every day yes every day and filing all my paperwork ie receipts etc in a folder that are all in order plus I back up my stuff on a memeory stick every couple of week or even weekly if I have been busy.

Or you could throw all your receipts on the dash then let them fall on the floor beside the Maccy D containers then at the end of the year you can gather them all up dump thenm on an accountants table and he will charge you an extra £200 to get the girl in the office to sort them out.

In other words it is a lot of common sense and you are legally obliged to keep good audited records in case HMRC want to speak to you and its worth it in the long run

 

[cogsey133]

I have an HND in accountancy and still wouldn't touch my own accounts....its too much bloody hassle! Trev is quite right plenty practices out there who will do the job for a set fee (their fee is tax deductible too)

 

[QuatroFromageo]

I have an HND in accountancy and still wouldn't touch my own accounts....its too much bloody hassle! Trev is quite right plenty practices out there who will do the job for a set fee (their fee is tax deductable too)

as an expense?

 

[trev]

Yes as an expense, plus I reckon if your returns are done by an independent 3rd party you're less likely to be the subject of an investigation. Although that theory is as yet unproven

 

[cogsey133]

Any fees you have to pay a specialist such as an accountant are tax deductible as an expense

 

[Knobhead]

Going back a good few years my partner and I wound up our entertainments and publishing business. Our accountant was a wind up merchant. He gave us his bill first and then gave us the accounts showing how much HMIT owed us. He was worth the money.

 

[Rockingit]

chances are they'll know more about what you can and can't claim than you or I.

In my experience Trev, not always so! Many of them are so set in their ways and in 'sausage machine' mode that they don't really ever think about what's legitimate for your particular industry and business. I used to use a guy that specialised in the entertainments industry, and he told me one time to buy more flowers for the wife (ex wife) as they could be justified as a touring expense!! How many High Street outfits would say that to you??

 

[trev]

In my experience Trev, not always so! Many of them are so set in their ways and in 'sausage machine' mode that they don't really ever think about what's legitimate for your particular industry and business. I used to use a guy that specialised in the entertainments industry, and he told me one time to buy more flowers for the wife (ex wife) as they could be justified as a touring expense!! How many High Street outfits would say that to you??

Completely agree with what you're saying mate, there are good and bad in every walk of life but I'm confident my mate Richard knows more about tax legislation and what I can claim for than I do.

 

[Rockingit]

Such a shame that people don't have this attitude when it comes to paying for a professional electrician................

 

[plugsandsparks]

All depends on where you're at and how much you know about the tax system. If you are a sole trader then there's not a formal need to use an accountant, but if you're a Ltd then you have to get your books audited regardless.

I do all my accounts, and my wifes, and it's not half as hard as people make out. I'm VAT registered as well, but then if you get some decent bookeeping software it's normally just a push-button exercise anyway. Only if you get into a real predicament can an accountant really justify their money.

Keeping good records as you go is half the battle I find.

Hope not as i do my own, i actually enjoy it. Do my VAT, it takes about an hour every three months, paye takes about 2 hours, end of year / CT takes about 8 hours.
Trick is to do you daily record keeping, book all your expenses in regularly and use HMRCs helpline. Certainly in the early days it was painful, there are fines waiting around the corner for almost all HMRC submissions, but they do negotiate if you have a case, I managed to get a £400 fine dropped to £100 and then £0 by simply appealing.
At least if you are doing your own accounts you know where you are at any given period.
However there is a steep learning curve which i am sure puts most people off.

 

[oldtimer]

Self discipline is what it is all about if you have the hunger to be your own boss then fine but if you cannot be bothered then bring on the fines

 

[Rockingit]

I have always been lead to believe that as a Ltd you need to have your annual return, therefore your annual accounts, verified independently by a certified accountant. This is to stop you from hiding assets and so on. Now, times change and this may have changed recently, but if so I've not been made aware.

 

[Rob Smith 643]

Are there any north-east based sparks who can make a personal recommendation for an accountant. I have been advised to get an accountant who, where possible, deals with our trade. Any recommendations would be gratefully received.

Cheers,
Rob

 

[trev]

There must be thousands of them in Sunderland mate, you might be better off asking someone in your local wholesalers as they will have detailed knowledge.

 

[Rob Smith 643]

There must be thousands of them in Sunderland mate, you might be better off asking someone in your local wholesalers as they will have detailed knowledge.

Cheers Trev,

There will be, I'm sure, one on every street corner in the town with an accountant wringing his hands in anticipation. I'll ask around as I'm not too sure of the wholesalers credentials. Bit like asking the barman for marital advice, it depends which barman you ask!

Rob

 

[trev]

No Rob, I meant ask one of the other sparks who get in there. Christ don't ask behind the counter, that's inviting disaster,

 

[Rob Smith 643]

Doh! :6:

 

[snowhead]

No Rob, I meant ask one of the other sparks who get in there. Christ don't ask behind the counter, that's inviting disaster,

No,, But we'll get you one overnight,, seems a familiar answer.
Or someone's just cleared us out of them.

 

[Rockingit]

No,, But we'll get you one overnight,, seems a familiar answer.
Or someone's just cleared us out of them.

"Temporarily over sold" has to be my all time favourite excuse. I hear it from my local outfit all the time!!

 

[HandySparks]

"You're the third person who's asked for them this week. There's no call for them."

 

[MDJ]

I use a chartered accountant for my annual return, as a limited company he actually makes things easier for me, knowing what you can get away with is something I don't know, and we pay enough tax as it is IMO, if we left our return to the IR we would have nothing left, times are tough as it is and there are many things which can be off set from tax and benefit your firm if you have the right accountant, just my view of course as an over tax payer who has had enough of the rates we pay in general.

 

[chronyx]

I wasn't going to bother using an accountant until someone told me some of the loopholes his accountant had used for him. Now I'm in two minds...

 

[Octopus]

I wasn't going to bother using an accountant until someone told me some of the loopholes his accountant had used for him. Now I'm in two minds...

I'd definitely say you should use one if only for a couple of years. its not rocket science but you are buying their up to date knowledge, etc, etc.

 

[Guest111]

A few years ago my mate decided to use an accountant instead of doing the books himself,he told the accountant he had never had any bother with hmrc but was a bit busy to carry on himself,the accountant said he was not surprised he,d had no trouble with hmrc as he wasn,t claiming anything like what he was entitled to.For instance washing powder as his wife washed his works clothes,a small wage for his wife as she answered the phone and took messages whilst he was at work,money for tools as he had not replaced any in years and didn,t know the exact allowances.Think it cost him a couple of hundred quid and he saved a couple of thousand.Plus if anything does go wrong at least you have someone behind you thats qualified and used to dealing with hmrc.

 

[thesnowman]

gonna do last years tax returns myself seeing that my earnings have been below the threshold (its been a ****ty year, work wise), it will be straight forward, expect to get all my tax back

my question is, at what amount is it really worth getting an accountant? when you are earning £15,000 onwards, when you are at the £20,000 point

 

[MDJ]

gonna do last years tax returns myself seeing that my earnings have been below the threshold (its been a ****ty year, work wise), it will be straight forward, expect to get all my tax back

my question is, at what amount is it really worth getting an accountant? when you are earning £15,000 onwards, when you are at the £20,000 point

Depends on your business type, if you have a separate bank account for business matters then I would use an accountant myself even if your turn over is low, if you run a company however it's a must IMO

 

[oldtimer]

Yep I do my own and keep all my records up to date Daily yes Daily also speaking to a builder who was telling me he was boasting how his accountant was worth every penny as he saved a fortune only for HMRC to pull him in and inform him that he had a wopper of a tax bill coming so am I saying dont use an accountant NO but if you are then get an assurance that if you get a big tax bill because he or she got it wrong then you will be expecting the very least for them to pay it or refund you all of their fees.

That should grab their attention and if they dont want to then in my view their not an accountant

 

[chronyx]

My accountant paid for himself last year and got me a tax rebate. Dropped last year's books off yesterday, as it happens.

 

[oldtimer]

My accountant paid for himself last year and got me a tax rebate. Dropped last year's books off yesterday, as it happens.

Yep so did the builder lol

 

[trev]

I think this is the equivalent of someone saying "It's only a few wires"
Yes self assessment isn't that complicated but all the various allowances are not widely publicised and a tax specialist would know what you can and can't claim for.
We all bitch and moan when people dabble with our trade......

 

[oldtimer]

Trev your right but what happens when a customer finds out that it was a Electrical Trainee who did the job and he has went bust or not insured lol

 

[thesnowman]

I think this is the equivalent of someone saying "It's only a few wires"
Yes self assessment isn't that complicated but all the various allowances are not widely publicised and a tax specialist would know what you can and can't claim for.
We all bitch and moan when people dabble with our trade......

if you had a leaky tap do you call an plumber and pay him example £50 to change a washer or do you do it yourself
its a simple enough job

 

[trev]

So is changing a light switch but if someone comes on here with no idea how to do it safely what do we tell him?
As I said, self assessment is easy enough but there's a lot of allowances that are not widely known and so could go unclaimed.

 

[Octopus]

My "local" accountant is part of my Business network! Some people just don't get the importance of networking!!

 

[HappyHippyDad]

I have just found an accountant that I like, he is going to charge me £300 to complete my tax return and I think this is roughly the going rate. This is as a sole trader, he said it would cost quite a bit more if I was a Ltd Company.

I do partly agree with Trev's view that you should get an accountant to do an accountants job but I think it depends on the type of job that needs doing. You wouldn't get in an electrician to change a fuse in a plug and I dont think the tax return for a sole trader is far off that example, although its probably closer to a 'like for like change' of a light switch :smiley2:

I'll be using an accountant this year (and asking him lots of questions) and then have a go at it myself the following year. If I struggle then I'll just go back to using an accountant.

 

[oldtimer]

I agree yep if you are Ltd and have a fair turnover and not very good at keeping records then yep an accountant but sole trader that turns over the average wage like me hence why I do my own and I complete my records daily so no scrambelling about in the motor siving the the Maccy D containers looking for receipts lol.