Introduction
Q) Are you getting a good deal from your existing accountant?
Q) Are you looking for a good accountant?
You may be looking for a new accountant because you are not happy with the service you are currently getting, or you may be looking for an accountant because you are entering contracting. In either case you need to know what you can expect to get from an accountant.
Listed below are important considerations when choosing a good accountant.
Single Point of contact
You should have a single point of contact who deals with your accounts. This is essentially an account manager who gets to know your accounts and you.
Although this does seem like an obvious thing to expect you do not get this with some firms who cater for the high volumes at a cheap price.
With some of the firms you might have to speak to a different person each time and repeat problems which can be very frustrating.
Understanding of UK Tax Law
Ensure that the people you use have a good understanding of UK tax law - the laws are not globally consistent. In the past some accountants have employed cheap labour from foreign countries who do not have a good solid grasp of UK tax laws.
It is not unknown for clients to receive conflicting advice, and in cases discovering the advice is wrong after checking with the Inland Revenue directly.
Personal Service
Do you get a personal service, or are you just a number going through the production line?
Your accountant is responsible for your accounts and should advise you personally how you can run your accounts to your benefit. This is not to say they should offer external financial advice, since that is another profession entirely, but they should be able to maximise your income within the existing tax laws.
Understanding of IR35
All accountants should understand the issues. Check that they do.
They should be aware of the ways in which to mitigate the large IR35 taxes, for example by utilising contractor pensions.
Connections with the Inland Revenue
Be very wary of accountancy firms who have strong relationships with the Inland Revenue. There was a past case when an accountancy firm 'acted on behalf of all their contractors' and asked them to pay an 'IR negotiated sum' for certain expenses based on a test case precendent.
Hidden costs and Total Cost
Beware of hidden costs. Many accountants provide a package which includes various extras like VAT and completion of personal tax assessments. Others quote a low rate but avoid telling you the hidden costs. Ask them exactly what is included and how much other services will cost. Get something in writing.
What you should expect to pay
For the proper services from a good quality accountant you should to pay yearly fees of around £800-£1000. This is more than some of the production line accountants, but worth the money and added value from the personal service.
If you do ask for extras that aren't standard then expect to pay the daily rate. At the end of the day, you get what you pay for.
Summary
Choose an accountancy firm who deals in providing quality at a reasonable cost.