How to find a great accountant and why you need one

So you think you might need an accountant, but not sure if you can afford one or what the benefits are? Find out how to choose one, what they should be doing for you, and what to do if they’re not up to scratch.

First decision : High street practice or sole practitioner? The main benefits of a sole practitioner are lower fees and a more personal service. They are often more flexible, and as they run their own businesses are much more likely to understand the pressures you are facing. My clients chose me because they like having a regular point of contact and proactive tax planning advice.

Talk to your business contacts and attend networking. Word of mouth is often the best way to find a great accountant. Find out who your business contacts use, their experiences and attend networking groups which invariably will have at least one accountant in attendance. Who you can get to know informally before deciding on appointment.

Check out Twitter. It’s another way of getting to know an accountant informally. See if they offer tax advice that is relevant for you as it’s a good sign they understand your business. Follow some lists such as http://twitter.com/efficiencycoach/great-accountants and http://twitter.com/BookMarkLee/uk-tax-and-accountants to get to know some great accountants, including me http://twitter.com/amyaccountant .

You absolutely WILL save tax. A good accountant will assess its clients’ needs, identifying areas where tax can be legitimately saved and offer tax planning advice for the future. Areas where I have helped my clients save tax is by advising on the best VAT scheme, identifying missing expenses, such as costs of working from home, broadband, insurances, carrying forward Class 4 NIC losses and advising on eligibility for child tax credits.

Avoid fines. Getting your tax return in on time is essential if you are to avoid heavy fines, and/or interest. A great accountant will know all the deadlines applicable to your business and make sure you work together to meet those deadlines.

Prove you are taking reasonable care. HMRC have changed their penalty regime from 2009 which means that you must demonstrate a commitment to correctly declaring your tax liabilities, and taking the best possible care over your books and records. What better way to prove your commitment than taking on a suitably qualified accountant. It says to the taxman, look I know this is my weak area so I am taking responsibility for my tax affairs by appointing this expert to help me.

Ask if your accountant will give you regular updates or a newsletter. I provide my clients with personalised updates to their particular industry or background, to make sure they are aware of any changes, for example compulsory online VAT filing, etc, so they can plan ahead and take on additional accountancy services if required.

If you have issues over affording an accountant, look for an accountant who offers special rates for start-ups. I have very reasonable packages for start-ups as I recognise how finances can be pushed to the limits in the first year. A good accountant will advise you on how to keep your books and records in order, to obtain the lowest fees possible.

Another reason why it is important to have any accountant is if you move house. If you are self-employed you won’t have any payslips to hand over as proof of your income when getting a mortgage, so it is essential to have an accountant who can provide you with a reference, let the bank know your past accounting and tax history and future expectations of growth.

If you get it wrong and choose an accountant who is not right for your business needs, don’t worry. It is very easy to change. Find a new accountant and they will write a “professional enquiry” letter to your old accountant asking if there is any reason why they shouldn’t work with you. They will also draft a letter for you to sign which allows the old accountant to pass over all old tax calculations and accounts to the new accountant.

Good hunting! For more information on accounting and tax services from Amy Taylor Accountancy, or a copy of my ebook “10 Top Tax Tips” for the self-employed, please ring me on 01767 260282 or email me at amy@tayloraccountancy.net. Visit my website at www.tayloraccountancy.net.

Amy Taylor Accountancy takes every care in preparing material to ensure that the content is accurate and up to date. However no responsibility for loss to any person acting or refraining from acting as a result of this material can be accepted by Amy Taylor Accountancy

Save money by claiming expenses of working from home

If you are self-employed and use part of your home for business, you can offset utility expenses and mortgage interest against your income, but beware of Capital Gains Tax implications!! Say you use one of your 6 rooms in the house solely for business and claim one sixth of all your utility bills and mortgage interest as an allowable expenses, when you come to sell your house, one sixth of any gain you make on the sale of the house could be subject to capital gains tax at 18%. There are allowances that could reduce the amount of any capital gains tax to pay depending on your circumstances.
A less complicated, and possibly more common scenario, is that you use part of your house for business, part of the time. In this case, you will not suffer Capital Gains Tax on the sale of your house, as you have not claimed an area of the house as exclusively used for business. HMRC have given us some examples of how to calculate how much of your utility bills and mortgage interest (not capital) that can be offset against income at http://www.hmrc.gov.uk/manuals/bimmanual/BIM47825.htm. These calculations are based on the amount of the house used for business, and the amount of time the room is used for business.
You can also claim expenses for working from home if you are employed, but there are many rules surrounding this, such as you having no other option but to work from home, for example if your employer is in Germany and there is no UK office, etc,.
For any further guidance specific to your circumstances and friendly accounting and taxation services, please email me at amy@tayloraccountancy.net. I am based in Potton, Sandy, Bedfordshire, but also deal with clients across the UK remotely.

Amy Taylor Accountancy takes every care in preparing material to ensure that the content is accurate and up to date. However no responsibility for loss to any person acting or refraining from acting as a result of this material can be accepted by Amy Taylor Accountancy