Choosing the right accountant
The right accountant for your business could make all the difference between success and failure in your start-up year. Chartered Certified Accountant Brian Pine tells you what to look for.
Your main criterion when choosing an accountant may simply be to find one who will ensure that you comply with the UK tax regulations. However, the right accountant will do much more than that.
Q How can an accountant help me in my start-up year?
Initially by advising on the best way to trade your business - as a sole trader, partnership or a limited company. Then by advising, for example, on an efficient book-keeping system in line with statutory requirements, or the level of annual sales you need to make just to break even (cover your costs). Additionally, your accountant should advise you on how to legitimately keep your tax bills to an absolute minimum.
Q Should I use a Chartered or Chartered Certified Accountant?
Yes. These accountants are professionally qualified by examination and have normally undergone rigorous training to help ensure that they give you sound taxation and business advice.
Q Any problem with using an unqualified accountant?
Whilst some do provide sound advice, many do not. Additionally, both the Inland Revenue and banks tend to take a more favourable view of information provided by professionally qualified accountants.
Q A business acquaintance has advised me to use his accountant and my bank has recommended that I use an accountant known to them. Which one should I choose?
Possibly neither. You should choose an accountant with whom you feel comfortable and who explains things to you in a manner that you can easily understand. Interview at least three accountants before deciding on the right one.
Q How much should I expect to pay my accountant?
The amount you pay will normally be based on the time spent working on your affairs. Charge-out rates will vary between (say) 40 and 90 GBP per hour depending on the type of work carried out. Many accountants offer a discount to start-up businesses for the first year. You should beware of any accountant who refuses to provide you with a detailed written estimate.
Q What are the four probing questions that I should ask any prospective accountant
1. How many businesses similar to mine have you got on your books? Can I talk to a couple of them?
2. Why should I employ you as my accountant in preference to any other?
3. How long will you take to prepare my annual accounts once I have provided my books and records to you?
4. How long do you normally take to return telephone calls when clients leave messages asking you to call them?
