It’s easy to get a bit complacent once you have an accountant, thinking they’ll just take care of everything for you, but it’s good to try and maintain an active role in the management of your business’s finances.

As a starting point, we’ll look at some of the best questions to ask your accountant to make sure you stay in the loop and on top of everything. Read our guide to finding an affordable accountant.

Is my current business structure tax efficient?

Your business structure is simply a way of classifying the legal status of your business for tax purposes.

For example, operating as a sole trader means there’s no legal distinction between you and your business. A limited company, on the other hand, is a separate legal entity.

Choosing the right business structure is perhaps the most important decision you’ll make, impacting how the business operates, as well as how much tax you need to pay.

Choosing what’s best for you depends on your individual circumstances.

For example, if you’re a sole trader with a high profit margin, it may be more tax-efficient to switch to a limited company so you can pay yourself a mixture of salary and dividends.

An accountant can take away the stress and break down the pros and cons based on your specific circumstances. They’ll also look at things like whether you have a high or low risk business for liability purposes.

If it turns out you do need to switch, they can walk you through the process.

What taxes do I need to pay?

The simple answer is, it depends.

Your accountant will make you aware of all your tax obligations, which vary depending on your business structure. So it’s a good question to ask.

As an example, sole traders pay Income Tax on their self-employed income, whereas in a limited company, the profits stay in the business until you pay them to yourself (e.g. in the form of a tax-efficient salary if you’re a company director). You can also pay yourself in dividends, if there’s available profit within your business.

Evidently, it can all get a bit convoluted, which is why having an accountant on hand is so helpful!

Do I need to register for VAT?

Value Added Tax (VAT) is a type of sales tax on all products and services deemed non-essential by HMRC.

If you’re a business owner, you only need to worry about it when your VAT taxable turnover reaches the £90,000 registration threshold in any 12-month period.

Now, some businesses choose to register for VAT voluntarily (to either start reclaiming it or simply to boost the business’s reputation), but be sure to speak to your accountant before making a decision on this.

What financial records do I need to keep?

Good record keeping is essential – both for HMRC compliance and managing your business.

Your records will generally show every transaction that happens in the business, and this allows you to track your spending.

At a minimum, you’ll need to keep records of your:

• Business expenses
• PAYE records (wages, tax, and National Insurance deductions)
• VAT records
• Financial documents (balance sheets, cash flow statements, and forecasts)

With Making Tax Digital (MTD) slowly being rolled out, it’s more important than ever to start keeping digital records using special purpose-built software.

Records also need to be kept for a specific period of time after submission, and your accountant can advise you on how long exactly, as it’s different for everyone.

How can I make my business grow?

First and foremost, you’ll want to set clear and actionable goals for yourself in both the short and long term.

Plan ahead (especially in the early days), and make sure you understand all of your tax obligations so you don’t get caught out.

It’s important to remember that a good accountant is more than just a tool to help you stay compliant.

They can also give input on things like cash flow management, tax efficiency, and your overall growth strategy.

Are there any upcoming changes I should know about?

Tax laws and regulations are constantly changing.

For example, the standard multiplier for business rates has decreased from 55.5p to 48p in 2026/27, and the minimum rate per hour for employees 21 or older has increased from £12.21 to £12.71.

These changes were announced as part of the 2025 Autumn Budget.

It’s part of your accountant’s job to keep you informed, but there’s no harm in asking directly if there’s anything you’re unsure about.

Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post Questions to Ask Your Accountant appeared first on The Cheap Accountants.

That said, there’s a whole host of reasons to hire an accountant for your business. In this article, we outline seven of the most common examples.

1. When you start buckling under the weight of responsibility

As a business owner, the weight of your to-do list can feel like ten tonnes. That sort of pressure can really take its toll.

If you find that your mental wellbeing and stress levels are starting to suffer from the workload, you need to delegate.

Passing the task of managing your bookkeeping and accounts onto an experienced professional can free up invaluable time, headspace and peace of mind.

This will help you to focus with greater clarity, and make better decisions for your business.

2. When you need some advice on your tax relief options

An accountant will do more than ensure you submit your tax return by the deadline. They will also be able to identify opportunities to claim tax relief.

Depending on the size, sector and circumstances of a business, there are a multitude of relief options to take advantage of in order to reduce expenditure.

It’s an accountant’s job to stay on top of these opportunities, and ensure you’re reaping the rewards of any benefits available to your business.

3. If you’re facing a challenge with your cash flow

When you run into financial difficulties, or any issues with your cash flow, having an expert on hand can help guide you out of the woods.

It’s easy to lose track when dealing with business finances on your own. Outstanding payments and forgotten invoices can all tip the balance of your income and expenditure, which can be extremely damaging to the health of your cash flow.

An accountant will help keep you on track and take care of all those important details and deadlines.

4. When you’re ready to register your business for VAT

Your business doesn’t need to register for VAT until your taxable turnover reaches £90,000. Once you reach that point – and if you aren’t already working with an accountant – it’s a great time to enlist the support of an expert.

Having an accountant helps to ensure that you’re doing everything you should be to satisfy HMRC, whilst staying as tax efficient as possible in the process.

5. If you’re looking for guidance on Making Tax Digital (MTD)

Making Tax Digital (MTD) is a government initiative for turning tax administration into a fully digital system.

It aims to “make it easier for individuals and businesses to get tax right and keep on top of their affairs”.

MTD for VAT is now mandatory for all VAT-registered businesses, regardless of turnover. MTD for Income Tax is being phased in for sole traders and landlords too, based on combined gross income (turnover, not profit) from self-employment and property. If that’s over £50,000, you’ve needed to keep digital records and send quarterly updates to HMRC since April 2026, dropping to £30,000 from April 2027.

Hiring an accountant helps make the transfer to MTD simpler for you and your business. It’s also useful to get to grips with cloud-based accounting if this isn’t something you’re already using.

6. When you’re looking to expand, invest or secure funding

Some businesses owners are unaware that an accountant can help you create a really solid business plan.

Having an expert contribute to the creation of your business plan will stand you in much better stead when it comes to applying for grants, loans, funding and investment.

These injections of cash are often significant accelerators for small or start-up businesses, sometimes even the difference between success and failure.

An accountant will help you position your business in a way which is genuine, whilst appealing to investors and funding providers.

7. Once you start employing staff

When your business is in a position to start recruiting employees or paying dividends to shareholders, it’s wise to seek support.

An accountant will manage your PAYE calculations, and offer valuable advice on allocating funds efficiently.

As well as the logistics of payroll, accountants can also offer advice about your additional outgoings, such as salaries and wages.

So what now?

Signing up for a financial service that cripples your cash flow is counterproductive! Compare pricing and accounting services.

Looking for more information before making a decision? Check out our advice on knowing whether an accountant will be good for your business.

The post How Do I Know If I Need an Accountant? appeared first on The Cheap Accountants.

There are lots of considerations to make, and so, naturally, it’s easy to overlook things. One thing you may have overlooked is whether or not you would benefit from hiring an accountant.

To help you decide, we’ll break down the process of becoming a sole trader, your legal responsibilities, and how an accountant might help.

What is a sole trader?

Let’s start with the basics. A sole trader is just someone who runs their own business as an individual.

There’s no legal distinction between you and the business with this type of structure, so you’re personally liable for anything that happens. This is both good and bad – depending on your circumstances.

Considerations about being a sole trader

On the one hand, your personal assets might be at risk if the business struggles because there’s no distinction beween you and your work. On the other, you get to keep any profits for yourself once you’ve paid income tax and National Insurance. But, you’ll be taxed on them even if you leave them in the business.

It’s relatively easy to get yourself set up as a sole trader, with fewer rules and paperwork than if you were to use a different business structure.

Do I need to set up as a sole trader?

It depends! If you earn less than the Trading Allowance (£1,000) in self-employed income, you might not need to tell HMRC or pay tax on this. You can claim the Trading Allowance even if you have other sources of income, too.

If you do need to set up a sole trader business, make sure you inform HMRC by 5th October in your second tax year. A tax year runs from 6th April to 5th April the following year.

How do I pay tax as a sole trader?

Right, so… You’ve set up as a sole trader and you get more than £1,000 of trading income in a tax year. Now what?

Well, you’ll need to start submitting tax returns to HMRC so you can pay income tax and National Insurance on the profit you make.

What sort of tax return do sole traders need?

This depends on how much you make in total from self-employment and/or property income in a tax year. You’ll normally start by submitting Self Assessment tax returns.

Over time, you might also need to consider Making Tax Digital (MTD) Income Tax. As it continues to roll out, MTD Income Tax will gradually replace Self Assessment for some people.

Those affected will need to keep their income tax records digitally, and share this information with HMRC on a more frequent basis using compliant software.

• You’ll use MTD to report your tax from April 2026 if you earned more than £50,000 as a sole trader and/or rental income in the 2024/25 tax year
• In April 2027, the earnings threshold to start complying reduces to £30,000 earned in the 2025/26 tax year
• From April 2028, it’s £20,000 for the previous tax year

How do I make a tax payment?

HMRC will calculate your tax bill once you submit your return. There are many methods you can use to pay, including HMRC online, Direct Debit or bank transfer. If you work for an employer and have a sole trader business on the side, you may be able to pay your self-employed tax bill through your PAYE tax code.

The deadline to pay is 31st January each year (the same as the deadline to submit your tax return for the year). If your tax bill exceeds £1,000, you’ll need to make ‘Payment on Accounts’ – which essentially splits your tax bill in two halves. The second tax payment deadline is 31st July.

What are my other responsibilities?

You want to . This will be essential in helping you fill out your tax return, and will also help you to claim tax relief without forgetting about any allowable expenses.

Do I need an accountant?

Having an accountant can be extremeley reassuring. They’ll:

• Help you set up processes for keeping clear, up-to-date financial records – known as bookkeeping
• Advise how to optimise any tax reliefs and allowances, and make sure you’re claiming any allowable expenses
• Suggest software you can use for bookkeeping, or for MTD compliance if this applies to you

There are lots of different types of accountancy services available, so take your time to understand exactly what sort of support you need, and make sure your accountant is appropriately qualified.

Find more help in our online accounting hub, and learn more about how to find the right accountant for your business. Read our guide to finding an affordable accountant.

The post Do Sole Traders Need an Accountant? appeared first on The Cheap Accountants.

Known as ‘appointing a paid agent’, it basically means delegating to a professional who will then liaise directly with HMRC about your finance and tax-related matters.

Who can be an agent for me?

Paid agents can be tax advisors, solicitors, or accountants, but you can authorise almost anybody to act on your behalf when it comes to dealing with HMRC, including family members and friends.

This type of agent is known as a ‘trusted helper’.

Although you have a number of options when it comes to who you can appoint as your agent to deal with HMRC, there are advantages to selecting your accountant for the role.

What can my accountant do as an HMRC agent?

An appointed agent can act on the taxpayer’s behalf for different types of tax, such as Corporation Tax, VAT, PAYE and Self Assessment – you might even have different agents for each one.

Simplifying processes and communication

Communication with HMRC can involve anything from queries and requests for information, to payment notices and deadline reminders. Appointing your accountant as your agent means the majority of this correspondence can be filtered through them.

This can make life a lot easier, leaving your agent to relay information to you as needed (and translated into plain terms, rather than scary-sounding HMRC speak).

Audit representation

If HMRC decide to audit your accounts or launch an inspection, your accountant will be able to make sure everything is in order, and talk you through what’s happening. An HMRC audit can be a daunting prospect, so having a professional in your corner can be a valuable source of confidence and support.

Compliance and strategy

As well as helping you stay on top of all your deadlines, your accountant will make sure you remain fully compliant with HMRC at all times.

They’ll also be able to help you optimise your tax efficiency, improve your financial reporting systems and save costs in line with all of the necessary rules and regulations.

Save yourself some time

As well as the tools of the trade that an accountant can bring to the table as your paid agent, there is also the overall benefit of significant time-saving – gold dust for business owners, right?

Having a professional at the helm of any back-and-forth with HMRC means you can focus on other things, like growing your empire. It also reduces the risk of any errors or confusion along the way, which, again, buys you back invaluable time and fends off financial penalties.

Keep stress to a minimum

All the above benefits combined make for a far less stressful relationship with your taxes and HMRC. Entrusting your accountant takes the pressure off you in exchange for peace of mind that your tax affairs are being dealt with by those who know what they’re doing.

How to appoint an accountant as an agent

The first thing to do is check your accountant meet HMRC’s standards for agents.

If you’re satisfied these standards are met, the next thing you need to do is provide your chosen agent with permission by appointing them through one of HMRC’s official authorisation processes.

Your agent will be able to guide you through whichever method is best for you.

Read our guide to finding an affordable accountant.

Authorising your agent with a 64-8 paper form

A 64-8 form can be used to authorise an agent to deal with Self Assessment, partnerships, trusts, tax credits and people being paid via the PAYE system. It’s also used for VAT and for Corporation Tax.

You and your accountant can work together to make sure all the necessary fields are filled in before you send it back to HMRC to process.

Authorise access to your accounts online

Your accountant can apply for access to your tax accounts through their own HMRC Agent account.

This process will generate an agent code for each tax type they’re dealing with for you, which will be sent to your registered business address. Share these codes with your accountant so they can complete the authorisation on their end and start acting on your behalf.

Grant access through your tax account

If you’d prefer to grant your accountant access to act as your paid agent yourself, you can do this through your business tax account by signing in using your Government Gateway or One Login.

Note: You will need to be set up and registered for HMRC Online Services for this method of agent authorisation.

A ‘digital handshake’

This is where your agent sends a link for you to click that will digitally authorise them to deal with HMRC on your behalf.

What happens after I appoint an agent?

Once somebody, such as an accountant, has been appointed as an agent ready to act on your behalf, you can arrange for them to receive most of your correspondence with HMRC. There are a few exceptions to this, including your tax bills and any refunds you’re eligible for.

Removing an agent’s access

If you no longer wish for somebody to have access to your accounts or act on your behalf as an agent, there are two ways you can undo this:

• Go to your HMRC business tax account (if you have access to this) and remove or swap the agent
• Contact HMRC over the phone or via post, and they will be able to guide you through the agent removal or replacement process from there

Your responsibilities as a taxpayer

Appointing a representative agent is useful but you (the taxpayer) are still ultimately responsible for reporting and paying your own taxes.

That’s why it’s so critically important to have a communicative relationship with your trusted agent(s) and provide them with honest, detailed, and up-to-date information.

It’s also essential to review all documents and tax returns that are shared with HMRC on your behalf to ensure that your records are accurate and compliant. If they aren’t, you’ll be the one dealing with the repercussions, such as financial penalties, not your agent!

 
Looking for more business support? Head over to our info hub for the latest news and handy resources.

The post Can My Accountant Deal with HMRC for Me? appeared first on The Cheap Accountants.

We’ve spoken many times before about the benefits of hiring an accountant to help your business be as tax-compliant and tax-efficient as possible. That said, affording the cost of an accountant is another kettle of fish, especially if you’re just starting out or hitting some financial struggles.

So, if you can’t afford to add an accountant to your outgoings, what are your options? After all, your tax returns are still going to roll around each year regardless.

In this article we explore your options if you can’t currently pay to hire an accountant. Don’t worry, there’s still plenty of help out there to keep you on top of your taxes with as little stress as possible.

Reach out to HRMC if you have tax questions

If you have any simple queries, you can contact HMRC online or call them to see if they can guide you.

HMRC also provides a whole host of different online resources to help taxpayers of all shapes and sizes. On the website, you’ll find things like free webinars and videos, tax return guides and handy tax calculators, all designed to support you.

Explore HMRC’s Tax Help hub.

Get in touch with TaxAid

If HMRC can’t help you out, your next stop should be TaxAid. It might also be your first stop if you’ve ever tried to look at one of HMRC’s tax manuals! TaxAid gives free, independent and confidential advice to low-income UK taxpayers aged under 60 or who are self-employed. It aims to make all things tax easier to follow and understand as a business owner who can’t afford the cost of leaving it all to the professionals.

It also supports those who:

• Have physical or mental health issues
• Struggle with addiction
• Have undergone traumatic or life-altering events
• Have poor communication, numeracy and/or literacy skills

You can call TaxAid’s dedicated helpline if you need some assistance: 0345 120 3779.

Use free online guides, templates and tutorials

The internet is full of free resources you can use to navigate your self-employed tax and accounting responsibilities. It can also be a bit too full of advice, at times. Do your homework and only use resources and guidance from sources you know are reliable. It’s also important to make sure you consult resources from the correct country! The tax rules in the UK are different to those in the US, for example.

Take advantage of free accounting advice

Even if you can’t afford to hire an expert, Google has got your back. Or rather, the fantastic accounting firms out there that are open to sharing free advice and resources online to help people in your situation.

A great example of this is the Ask an Accountant feature offered by The Accountancy Partnership, where you can ask a qualified accountant a tax question for free.

Some firms will offer things like consultations to support you without having to commit to paying for the full service.

Take a course in accounting basics

If you think you may not be able to afford an accountant for the foreseeable future, it could be worth equipping yourself with the basic accounting skills you might need.

There are dedicated course websites like Coursera, the Open University, Udemy and edX but YouTube is also a great place to browse for free but valuable learning content.

A course may require an initial investment as some will be paid but there are plenty of free versions available. Even if it does come with a price tag, it could save you a lot of money in the long run. You might be able to claim the cost as a business expense, by deducting the amount from your total income when you submit your tax return to HMRC.

Use free bookkeeping software

Good bookkeeping habits are the foundations of accurate, timely and low-stress accounting, so finding free bookkeeping software will make your life a whole lot easier.

Don’t be afraid to ask for help

If you are in a position where you can’t currently afford the cost of an accountant, don’t be nervous about reaching out for help. There are so many other business owners in exactly the same boat, which is why there are so many brilliant free resources out there!

Don’t be afraid to speak to other business owners you trust about general advice or help with specific tax-related topics. They may be able to show you how to do something, help you understand something you’re confused about, or point you in the direction of some other great tools and resources they rely on themselves.

If you don’t have a trusted network of like-minded business owners, you could consider joining a business support group or look on social media platforms like Facebook or LinkedIn. There you’ll find communities of people just like you, with questions just like yours.

Managing your taxes yourself can be tricky, especially if you’re not familiar with the rules! Check out our accounting support hub for more help, or to ask a tax question for free.

The post What Can I Do if I Can’t Afford an Accountant? appeared first on The Cheap Accountants.

You can do it yourself online through HMRC, and the process is relatively straightforward.

That said, many businesses do choose to use an accountant for this, as PAYE involves ongoing responsibilities – including accurate payroll calculations, real-time submissions to HMRC, and managing deductions – where errors can lead to penalties.

This article explains how PAYE works, when you need to register, and the benefits of getting professional help.

What is PAYE all about?

“PAYE” is short for Pay as You Earn. As the name partly suggests, it’s a mechanism for employees to pay their income tax and National Insurance contributions while they’re earning.

No matter how regularly you pay your staff, they’ll need to pay tax, NI, and other contributions such as pension payments, on their income.

PAYE enables employers to deduct these payments ‘at source’ – that is, from their employees’ wages, and then pay everything over to HMRC for them.

An employer’s PAYE scheme can also be used for other deductions such as car payments and student loan deductions.

In short, employers become the tax collector, so that employees don’t need to spend time on tax returns (and risk getting it wrong) to report employment income.

Making deductions through PAYE

How much you deduct depends on the employee’s tax code, what they earn, and any other contributions they need to make.

For example, a tax code shows how much an employee can earn before they have to start paying tax (an amount known as their personal allowance).

The most common tax code is 1257L. This shows that the employee can earn up to the £12,570 Personal Allowance in a year before they need to start paying tax.

An employee might also need to pay National Insurance or pension contributions, and student loan repayments too!

How do I know when to register for PAYE?

You’ll need to keep really accurate, up-to-date records of everything that you pay to or deduct from anyone in your business, but you might not need to register for PAYE straight away.

You’ll need to register as an employer with HMRC if any employees or directors:

• Are paid at or above the secondary threshold – £96 a week in 2026/27
• Receive taxable expenses or benefits
• Have another job
• Get a pension

Is registering for PAYE fairly easy?

This depends on a few things, not least if you’ve done it before. The process itself is relatively straightforward but as ever with HMRC, the information you might need can seem confusing.

It’s why many companies decide to use an accountant to register for PAYE rather than go it alone, but there’s no requirement either way.

The important thing when operating payroll is that it’s absolutely accurate.

The information you put into your payroll calculations must be correct, and the system that you use must be reliable!

It’s your responsibility to make sure everything is correct, and that both your employees and HMRC receive the right payments, at the right time.

Otherwise, you could end up with hefty fines, and some very fed-up staff.

What information do I need to set up a PAYE scheme?

Whether you decide to register for PAYE yourself or get an accountant to do it for you, there’s some information you’ll need:

• Company name (or business name if you’re a sole trader)
• The company director’s full name and NI number
• Company Registration Number (CRN)
• Nature of the business
• Company unique taxpayer reference (UTR) number
• Business address
• Number of employees
• First payday

Once you register online for the PAYE system, you should get a PAYE reference in the post along with an Accounts Office Reference.

This will be sent out to the address your business is registered to, and usually takes around 5 working days to arrive.

What are the benefits of using an accountant?

Your working day is busy and frankly, you just want to get on with what you do best. By handing over all the fiddly bits to a specialist, you can save time that’s better spent growing your business – but do you actually need an accountant for your business?

Getting the details right

Accountants have seen it all before – many, many times. They’re experts at completing and submitting tax forms and know exactly what HMRC is looking for.

There’s also far less chance of expensive errors that can hit you hard in time and money.

Cutting your tax bill down to size

When you submit your tax return, it’s not just about ticking a few boxes and checking figures. There are lots of ways you can (legally of course) reduce your tax bill through tax breaks and reliefs.

Some of them you’ll probably be aware of already, but many of them you won’t. Any accountant worth their salt will help you make sure that you don’t pay more tax than you should.

In fact, the savings you make can often cover the cost of using an accountant in the first place. You also don’t need to spend your time trying to keep up with ever-changing tax legislation.

General business advice

A decent accountant will often be in the best position to offer tailored advice that suits your growing business. They’ll likely have dealt with similar businesses before and will have in-depth knowledge of your finances.

There’s lots you can ask your accountant to do for your business. Having the chance to bounce ideas about and discuss things with your accountant is also really important.

They can offer valuable support and give the kind of objective feedback that’s hard to find elsewhere. And if you’re struggling with something that your accountant can’t help with, there’s a high chance they’ll know someone who can.

Find more tips and advice for your business on our website, or tap into our guide on hiring the right accountant.

The post Do I need an Accountant to Register for PAYE? appeared first on The Cheap Accountants.

You might run multiple businesses that benefit from specialist expertise, want to keep your bookkeeping and accountancy separate, or simply be in the process of transitioning from one firm to another.

That said, there are also good reasons why keeping everything under one roof can work better.

This article weighs up both sides to help you decide what’s right for your business.

What are the advantages of using more than one accountant?

Why might a business owner choose to work with more than one accountancy firm at the same time? There are lots of reasons, such as needing specialist support in one area of the business, or to keep different businesses separate.

Tap into specific skillsets where you need them

Perhaps you operate one business as a sole trader, and also own and operate a limited company. You might want to delegate each of your accounts to experts in these areas.

For some businesses it can be more complicated than that. For example, you might need an accountant who deals with Capital Gains Tax to help you with one particular income stream, or someone who specialises in R&D claims.

Keeping your accounting and bookkeeping separate

Accountants and bookkeepers carry out different roles – some business owners prefer to assign these responsibilities to multiple firms or contractors.

Making the transition

Some business owners will overlap the firms they work with for a period of time, as they transition from one to another.

The benefits of sticking to one accounting firm

Looking at the situation from the other side of the fence, let’s now explore why using one accounting firm at a time might be the preferred option. These are only general points though. Every business is different so your needs might not fit neatly into any of these!

More well-rounded knowledge of your business

When an accountant has full access to every part of your businesses, they have a much more comprehensive picture. This, in turn, allows them to advise you on ways to be more tax efficient across the board, and help you make more savvy decisions around things like spending, cost-saving, investments and recruitment.

You can avoid paying double fees

When you only work with one firm at a time, you only have one invoice to worry about paying. Your accountant might charge you for each business (because they’re doing more than one set of accounts), but may also offer discounts if you sign up multiple businesses for their services. Accountancy fees can vary, so do your research!

A more streamlined process

As with most processes in life, when everything is all in one place, things seem to run a whole lot more smoothly. Sticking to one accountancy firm at a time will lighten both your cognitive and admin-based loads.

Stronger relationship-building

Investing all your time and energy into one accountancy firm or accountant will bolster your professional bond with them. That’s not to say, of course, that you can’t have great relationships with multiple service providers.

How to find the right accountant for your business

Whether you’re looking to use multiple accountancy firms or put all your eggs in one basket, it’s essential to do your homework before making any final decisions.

Here are just a few of our top tips for finding the right accountant for you and your business:

• Read plenty of reviews online: There’s nothing quite like reading through client-generated reviews (rather than company-created case studies) to see real opinions.
• Set up an intro meeting: If you come across a firm or accountant that you like the sound of, set up a call to get a better idea of whether you’re going to get along.
• Check out their client base: Investigating which customers a firm or accountant typically works with will give you more insight as to whether they’re the right fit for you. If they work with other businesses in your sector, for example, you’ll know they have plenty of relevant experience and transferable knowledge.

 
Compare accountancy packages, or ask a tax question for free!

The post Can I Use More Than One Accounting Firm at a Time? appeared first on The Cheap Accountants.

But, if you want expert financial analysis, tax efficiency advice, business forecasting, and professional representation with HMRC, software alone can’t replace that.

For most businesses, the ideal setup is both working together – and this article explains why, along with what each one brings to the table.

What is the difference between accountancy and bookkeeping?

Although bookkeeping and accounting both deal with a business’s finances, they do so in different ways. A simple way to look at it is like this: bookkeeping is just that – keeping the books up to date. Accountancy is about analysing, understanding, and reporting on this data.

Read our guide to finding an affordable accountant.

What a bookkeeper does

Bookkeeping is the process of recording financial transactions and maintaining accurate business accounts. These are the cold, hard, numerical facts about what comes in and goes out of your business. It’s essentially the preliminary admin necessary for an accountant to do their job.

What an accountant does

An accountant will use the information which the bookkeeper records to improve the tax-efficiency of a business and support its financial health. They can help business owners make more money-savvy decisions, whilst ensuring everything is compliant – particularly if HMRC decide to do a spot-check!

Can bookkeeping software replace an accountant?

The answer to this question largely depends on what you rely on your accountant to do for you. If you only enlist them to carry out financial admin and prepare your annual tax return then yes, in theory, you could do it all yourself using bookkeeping software.

However, if you were to really wring all possible potential out of your accountant’s expertise, you might find the answer to this question is a hard no.

Make no mistake, using bookkeeping software has an enormous number of benefits, including:

• Keeping all of your financial information in one place, improving access and organisation
• Remote access for multiple users when you choose a cloud-based bookkeeping software
• Using software that includes active error detection reduces the risk of mistakes in your records
• Save time on data-entry by connecting payment feeds directly to the software
• Automated reminders so you’re less likely to miss a deadline
• Minimising the risk of omission and human error

But bookkeeping software doesn’t have an accountant’s ability to spot areas where you can become more efficient in the way you run your business, or in the way that you pay tax. If you were truly working effectively with your accountant, you wouldn’t even consider sidestepping them for software alone.

If you can afford it, tapping into both resources simultaneously can help you more effectively as a business owner.

The benefits of having an accountant and bookkeeping software

We’ve touched on a few of the most common benefits of investing in great bookkeeping software above. But why do we recommend you still consider using an accountant as well? Ideally, the bookkeeping software you use will complement the work an accountant does for you.

Professional data analysis and insights

With access to accurate financial records (courtesy of excellent bookkeeping), an accountant will be able to dig into the data of your business accounts and offer insights accordingly.

Good bookkeeping software will have a range of comprehensive reports included, but if you’re not very experienced then you might find an accountant can help make sense of it all. These types of insights could be the difference between making your first million or operating at a loss for the next five years.

Better business decisions

An accountant will be able to provide you with valuable decision-making guidance by applying their expert risk analysis, financial forecasting and budget advice. Remember too, they see behind the scenes of a lot of other businesses!

Improved cash flow health

When you have professional data analysis, audits, risk analysis, and forecasting on your side, it stands your cash flow in great stead. Not only will this positively impact your current cash flow situation, you can also work with your accountant to plan ahead, mitigate pitfalls, and grow stronger as a business.

A buffer between you and HMRC

As well as insight into your financial profile, a good accountant will also offer representation in front of HM Revenue & Customs, if and when you might require it. It helps reduce some of the stress!

Our verdict?

When used in conjunction, bookkeeping software and the services of a terrific accountant are a force to reckoned with.

Without robust bookkeeping down to the decimal point, an accountant can’t possibly do their best work. Without an accountant on the receiving end of the information, there’s a ceiling on how useful even the most meticulous bookkeeping can be if you really want to maximise efficiency in your business.

 
Looking for some more support with your business finances? Compare accountants and learn more about bookkeeping software.

The post Do I Still Need an Accountant if I Use Bookkeeping Software? appeared first on The Cheap Accountants.

While there’s no legal requirement for you to have an accountant on board when you launch your business, their experience and expertise can be a valuable source of information, guidance, and yes – reassurance. So how do you know who to choose, and what can they do to support you? Let’s take a look.

What are the benefits of having a business accountant?

There are several reasons why having an accountant can be useful, including:

• They can help you save huge amounts of time on tasks that would take you much longer, such as tax and VAT returns
• An accountant has the experience and knowledge to help you stay compliant with Companies House and HMRC rules
• Being in the industry, they’re a good source of information about grants, funding, and allowances suitable for your business
• A professional insight of your tax efficiency. An accountant can help you limit the amount of tax you have to pay, whilst ensuring you’re fully compliant at all times. That includes claiming for any expenses you’re entitled to, but worried about claiming for!
• Help with business planning and financial forecasting, so you can be as efficient as possible

Read our guide to finding an affordable accountant.

Even brand new startup businesses, or those about to get going, can benefit from their money saving expertise. Don’t let this overwhelm you though. Whilst your business is still in its infancy, you could always enlist a professional on an ad-hoc or consultancy basis.

You might even look for an accountant who charges their services as a monthly fee, helping you to spread the cost.

Writing a knockout business plan

An integral part of all solid business plans includes information about its financial situation and future projections. Any lender or investor looking at your business plan is going to want to see these details. Having a qualified accountant help out with this is a great way to ensure accuracy and authenticity.

Forming your company

An accountant will be able to guide you on what type of business structure would be best for you, such as operating as a sole trader or forming a limited company. They will even be able to help you form and register the business correctly.

Starting as you mean to go on with good bookkeeping habits

Balanced books and organised accounts are key to maintaining healthy cash flow. Having an accountant will help you stay on top of your bookkeeping.

Some accountants will even provide you with access to bookkeeping software as part of their services.

Help applying for loans and funding

Accountants are incredibly useful if you’re planning on looking for cash to help your business scale or develop in some way. They’ll be able to help you present your request and supporting information, as well as spot opportunities you might not think of.

Keeping you on the right side of HMRC

Experienced accountants are well-versed in HMRC deadlines and regulations. This knowledge will help to keep your business on the straight and narrow.

Things to look out for in a great accountant

Accountants in general have a lot to offer for a business. To really get the most out of paying an accountant’s fees though, consider the following points as a rough guide to help you choose one right for you.

• Experience working in your industry or sector
• A great reputation, and positive online reviews
• Use of online accounting software or a bookkeeping service to help you keep everything up to date (and without needing to visit them in-person if that’s not a requirement for you)
• Knowledge of the various tax laws and regulations that apply to your industry
• A strong rapport with you and your staff, because things tend to run much smoother when everybody gets along
• Attention to detail and vigilant analytical thinking
• Good communication skills, so you always feel kept in the loop
• Receptive to any questions you might have!

 
Still unsure about taking the plunge, but need some help? Ask a tax question for free!

The post How Do I Know If an Accountant Will Be Good for My Startup Business? appeared first on The Cheap Accountants.

Good accountants can be used as a key tool for growing your business, so here are our top five ways to get the most from them.

Give them the right information

In an ideal world your accountant would follow you around, recording and considering all of your financial transactions and advising you of the tax implications.

Fortunately, accountants generally don’t have the time or desire to stalk their clients 24 hours a day. Unfortunately, they depend on you to give them a complete and accurate summary of your financial year!

A good accountant can usually draw out the relevant information with some basic questions, but the more effort you put into the basics, the less time you’ll have to spend on getting what you actually came for – an informed opinion on how you did with your finances from a tax perspective, and advice on how to minimise your taxes going forward.

So in simple terms, your first step in getting the most out of your accountant is to create an accurate and concise snapshot of your finances.

Tap into their networks

>As a small business, it is likely that the accountant you’re using is also working for a host of other businesses. Ask your accountant if they’re willing to initiate networking opportunities between you and other clients. This could lead to business deals, partnerships or a support network of people facing the same problems as you.

Value their advice

Your accountant will have expert knowledge of not only your business but of others like it. This means they can help you uncover ways of expanding your business and reducing your costs, as well as indicating areas where you need to spend more. It’s likely that any problem you face will be familiar to an experienced accountant, so they will most likely know how to solve it. Trust them!

Never lie!

Doctors can save your life, lawyers can save your freedom and accountants can save your livelihood, so always tell them the truth. Accountants need to know every fact about your business so they can work out how much tax you pay and how your business can make the maximum amount of profit. If you lie to them about your finances, this could lead to mistakes in your bookkeeping and possibly even the downfall of your business.

Arrange regular catch ups

Accountants usually have a large number of clients, meaning you can’t rely on them to contact you all the time. You should arrange to have monthly meetings or weekly phone calls with them, allowing you to discuss any problems or ask any questions. If you delay speaking to them and then dump all of your difficulties on them at the end of the tax year, problems may escalate and cause a last minute panic.

Check out our accounting support hub for more help and resources, or to ask a tax question.

The post Five Ways to Get The Most From Your Accountant appeared first on The Cheap Accountants.