How much should I be paying for an accountant?

[adam thompson1981]

I formed a ltd company in may this year and took on an accountant at £72 per month.

No other employees, turning over a projected 45k this year...

I do all my bookeeping.

Anyway prices have just been increased to £80 plus vat, so thats £96 pm for me.

Seems a lot to be paying for a small business with no employees and just dealing with the end of year tasks..

Or am i just being tight? Not sure how much is s reasonable figure for ltd accounts?

 

[Mr D]

At that level of turnover the cheapest I can recall seeing is 700 odd a year. I think it's similar to your service - pretty basic?
5 years back for a figure around your turnover I was paying around 900 a year for similar service.
Those figures include vat.

Some people appear to be paying over a grand currently for limited company.

 

[Bob Morgan]

Will he save you £1,162 each year? (12*96)

 

[adam thompson1981]

Will he save you £1,162 each year? (12*96)

I don't see how they will save me any more than the next accountant. It's a very simple business

 

[SteveHa]

And who takes care of all the compliance issues, planning, tax adjustments to the accounts etc.?

 

[mattk]

Will he save you £1,162 each year? (12*96)

This is a very good way of looking at it.

Take into account:

Your time in preparing payroll, VAT returns, end of year accounts - plus learning how to do it if you've never done it before
Tax you'll save from your accountant's expert advice
Other non-tangible benefits

My advice is not to scrimp on accountancy, at least for your first year. Once you have seen what is involved in the above steps you can decide if it is cost effective to do it yourself or pay your accountant to do it for you.

For example, I do my own VAT because it is incredibly easy, but don't bother doing my payroll as what my accountant charges is roughly the same as what I'd have to pay for the software to do it myself. Having just completely my first year end there is no way I would attempt to produce the accounts myself.

 

[Newchodge]

I don't see how they will save me any more than the next accountant. It's a very simple business

But the next accountant will also charge you something, probably something similar.

Incidentally, you mention not having employees but, presumably, your company is paying you wages through payroll?

 

[Glenn Martin]

Do you want a good accountant or just a cheap one.

Accountants dont charge fees a % of turnover so you will find that as your business grows you fees wont really increase by the same %.

There is a base level work involved and the fees you have been charged are not unreasonable.
The vat element is not part of the accountants fee but it is a cost to you.

If its an issue if you can find anew startup accountant who is not VAT registered they will effectively be 20% cheaper although they will likely need to register in a year or so as they grow.

Does the fee also include a software subscription to do your bookkeeping on.

You maybe able to shop around and get someone cheaper but I rarely find that cheap is good.

 

[MyAccountantOnline]

....
Seems a lot to be paying for a small business with no employees and just dealing with the end of year tasks..

Or am i just being tight? Not sure how much is s reasonable figure for ltd accounts?

If you just want an accountant to prepare the year end accounts and a tax return for your company you will find cheaper than that.

I run an accountancy practice and we offer an all inclusive pay monthly service which includes advice and support throughout the year but also a year end service where we just prepare the year end accounts and tax returns for clients that want that (and quite a few do). The fees are on our website if you want to look. Your accountant may perhaps offer something similar?

 

[adam thompson1981]

Thanks guys, yes i was just wondering if i was overpaying at almost 1200 a year thats all, particulary as it has just jumped from about 850 for the same service.

my accountant does do my payroll although thats something i could do myself (did my own as a sole trader for an employee using free version of brightpay and found it super easy) but dont see the point for the sake of a fiver a month...

As for what i require, just a basic service, i dont need the best accountant in the world just someone who knows the basics and submit the end of year stuff etc, i dont need bookeeping, nor any complicated advice as i know mostly what i can and cant claim etc from years of doing my own books and return as a sole trader....My business is window cleaning, theres not any complicated calculations, its mainly money in money out and a few expenses, theres no capital assets or vans etc in the business.

 

[MyAccountantOnline]

Thanks guys, yes i was just wondering if i was overpaying at almost 1200 a year thats all, particulary as it has just jumped from about 850 for the same service.

my accountant does do my payroll although thats something i could do myself (did my own as a sole trader for an employee using free version of brightpay and found it super easy) but dont see the point for the sake of a fiver a month...

As for what i require, just a basic service, i dont need the best accountant in the world just someone who knows the basics and submit the end of year stuff etc, i dont need bookeeping, nor any complicated advice as i know mostly what i can and cant claim etc from years of doing my own books and return as a sole trader....My business is window cleaning, theres not any complicated calculations, its mainly money in money out and a few expenses, theres no capital assets or vans etc in the business.

I really would speak to your accountant - explain exactly what you've said above and see what they can do.

 

[DontAsk]

£660/yr inc. VAT for Ltd. with similar turnover and one employee, but I do my own payroll with HMRC's free software.

 

[UK Contractor Accountant]

theres no capital assets or vans etc in the business.

Do you go round on foot then?

 

[adam thompson1981]

If you just want an accountant to prepare the year end accounts and a tax return for your company you will find cheaper than that.

I run an accountancy practice and we offer an all inclusive pay monthly service which includes advice and support throughout the year but also a year end service where we just prepare the year end accounts and tax returns for clients that want that (and quite a few do). The fees are on our website if you want to look. Your accountant may perhaps offer something similar?

I will have a look what you have to offer, thanks

Do you go round on foot then?

Being an accountant I would have thought you were smart enough to work it out not make sarcastic comments....

The van is mine, i claim the mileage from the company.

 

[UK Contractor Accountant]

The van is mine, i claim the mileage from the company

Who told you that was the most tax efficient way of operating?

 

[SteveHa]

I have to agree with UKCA. You don't seem to be operating tax efficiently. This is the value of a good accountant, not in their ability to count beans, but to know which beans to count.

 

[Jaydee]

You don't seem to be operating tax efficiently.

Could be though, if there is significant business miles and modest running costs - particularly if he owned the van personally prior to the company being formed and so would have WDA rather than AIA.

 

[Richard Patey]

I would think £100/m is about average, I'm solo director / owner and pay a little more

 

[adam thompson1981]

Nobody told me i decided myself......

45p a mile, i do about 8-10k (business) a year so £4500 (10k example)
35mpg so £1700 fuel cost
insurance is about £350
tax £250

so gives me about 2k to play with for m.o.t/servicing/repairs etc to break even, but most likely i make a profit.

even if it isnt the most tax efficent way, its the easiest and what i prefer.

 

[Mr D]

Nobody told me i decided myself......

45p a mile, i do about 8-10k (business) a year so £4500 (10k example)
35mpg so £1700 fuel cost
insurance is about £350
tax £250

so gives me about 2k to play with for m.o.t/servicing/repairs etc to break even, but most likely i make a profit.

even if it isnt the most tax efficent way, its the easiest and what i prefer.

Can help to talk to an accountant about options at some point. When looking around for one many will give an initial consultation for 30 minutes (maybe more) for free. Have a list of questions to ask. Don't have to sign up with the first one you see.

Occasionally may find your local area having a business event day, multiple support companies doing for example a business fair and new or experienced business owners wandering around getting free pens, business cards and opportunity to meet and discuss particular matters with experts. Councils and local chambers of commerce often keen to help businesses prosper in one fashion (while council messes them about in other ways!)
I met my first accountant at one of those events, didn't sign up with him until about 3 years later.

 

[Raxsonic]

Discuss the existing fees and service with you current accountant, before you make any decisions. They will either review the fee or give you a detailed breakdown of what they are providing to your business in return for monetary value. You can then make an informed decision to continue or to find an alternative.

 

[Nicnak]

hello everyone

I’m not sure if you can advise me, but I sure hope so.

I have worked under my ltd company since around 2010 with the same accountant. In 2017 due to changed in the law my role fell into IR35, at which point my tax obligations were no longer deducted and carried out by my acccountant, but rather deducted at source by the public sector employer which held the contract with the agency that employed my ltd. Between April 17- Dec 17 this continued. Then in Dec 17 I stopped trading via my company, and became a formal member of the public sector.


I need to close my company and therefore need to do my end of year accounts for April 17 - March 18, both personal and company and he is charging me £1200.

He also states i cannot close the company and must continue to submit accounts (which would mean paying him), until I have paid my corporate tax bill with HMRC in full. This is being done via payment plan, as I cannot pay one off.


Any advise on the rate, suggestions of a good accountant, and reality of his instruction?

Sincerely NicNak

 

[Scalloway]

He also states i cannot close the company and must continue to submit accounts (which would mean paying him), until I have paid my corporate tax bill with HMRC in full. This is being done via payment plan, as I cannot pay one off.

How long are you going to be paying off HMRC for?

 

[UK Contractor Accountant]

You can close the company down and continue to pay off the CT debt provided HMRC do not object the dissolution of the Company.

HMRC will not care which bank account you use to make payment so you can route it through a personal bank account once the Company bank has been closed down.

 

[Nicnak]

Thank you UK contract Accountant. So now I just need to do end of year accounts for the period up until the company became redundant? Or the whole financial year?

 

[UK Contractor Accountant]

period up until the company became redundant? Or the whole financial year?

you can change the financial year end to Dec 17 and prepare cessation accounts to that date and then apply to have the company dissolved once filed at Companies House and HMRC.

 

[Jason Howard]

My Accountant charges me 500 per year and i am only a small business. I even do most of the spreadsheets myself. I think #100 per year is a bit steep but it depends on what and how involved they are. If they are saving you money then perhaps it is worth it?