Starting a Business (Part 2): Get a good Accountant – why risk it?

Date: 2nd February 2017   |   Author: Adam Phillips

So, you’ve been made redundant, you have a wedge of cash coming through and you decide it’s time to start your own business… or you’ve decided that the management isn’t to your liking and you fancy being your own boss. It’s time to become self-employed. Easy, right!?

The accountant 

One of the first questions asked in one of my interviews is ‘have you currently got an Accountant?’ Most of the time the customer replies ‘yes I have’, however, there are a lot of people that answer ‘yes, well… I do my own bookkeeping and then just submit my own end of year when they need to be done.’ - Which is absolutely fine, nothing wrong with doing your best and keeping costs down, however, what if i said that, without knowing it is 100% correct, this may end up costing you even more than if you had hired an accountant in the first place? It is probably a good idea to get someone who is qualified to confirm that the figures that you have put are either 1) In the right place or 2) Precise.

Bookkeeping is very similar, but it is not Accounting.

There’s a reason I get a mechanic to look at my car – because I’ve never completed a mechanics course, I could probably give it a bash – but why risk getting it wrong? I could probably build a brick wall, but there’s a reason I get a brickie to do it instead – why risk getting it wrong? Unless your job is ‘an accountant’ and/or you’re up to date with the latest budgets, financial acts, rules and regulations, are confident with fiscal policy, know all the tax rules and have kept up to date with HMRC procedures and of course you have the time to actually do it - it might be worth getting someone who is qualified to do it for you – why risk it? Then you have to ask the questions:

- what kind of accountant do I want or need? -Are there specific accountants that specialise in my industry? -Do I want or need a chartered accountant? -Do I require a strong customer service (you may be very happy with having everything online)? -Do I require business mentorship? How straight forward are my books? -Do the accountants allow face to face contact? -What other services does the accountant offer e.g. bookkeeping software or perhaps other back office functions?

Remember it might cost you from as little as £30 a month to have an accountant, if you charge £30 an hour for your work and it takes a couple of hours to complete bookkeeping per week and a further 2 hours to complete a tax return, then potentially that's 106 working hours within a year. If you had worked them hours, you could have earned £3180. The accountant would have cost £360. Plus, it's less stress, one less job, if you will, for you to do. Those two hours or so, can go back in your pocket, for you to do, whatever you'd like.

These are the people that will make your business look great (or as best as it can) or look terrible. These are the people that will save you tax or cost you money.

I have recently seen a client that has been with his accountant for 16 years now. It has come to light that the chartered accountant didn’t mention (as he doesn’t give advice) that had the customer been a limited business, he could have saved him over £150,000 in tax and revenue.  It’s important to note…this is a true story. I have not fabricated this last paragraph, I can’t go into specifics for obvious reasons, but just imagine what he could have done with that additional income.

Like any service in life, every now and then you have to re-visit the service that you have and compare them to others. Just because you’ve answered the questions and think that you have got the right package, doesn’t mean that you cannot revisit them time and time again.  Also, don’t fall into the trap off believing that loyalty counts for anything, if the right questions had been asked, perhaps this chap may not have lost out on £150,000 worth of money.

For any additional help, please contact me on 07718 320510, Adam Phillips, Local Business Manager, Santander, Andover.

Please note that any views and/or opinions expressed here are solely the views of myself, Adam Phillips and not that of the bank Santander Uk Plc or any of its affiliated companies.

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