Changing accountants

Changing accountants - Easy or not worth the effort?

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Case study - Moving from a traditional 'shop front' high street accountant to a specialist contractor firm.

Like moving banks or changing your energy supplier, changing your accountant may seem like a huge gamble and one which, you may think, requires months of meticulous planning. However, nothing could be further from the truth.

Read how Malcolm, an IT Contractor in London, made the move and hasn't looked back since.

"Prior to leaving the perceived safe and cosseted world of permanent employment (whatever that means) and making the move to become a contractor, I did lots of research about the various methods of operating which really came down to using an umbrella company or working through my own limited company.

Changing accountants

I asked contractors I worked with how they worked - limited or umbrella company and views were fairly mixed. Some liked the admin free life of using an umbrella company whilst others preferred the control and financial benefits of working through their own limited company. Both groups seemed happy with their choice and I could see the benefits of each.

I was pretty sure when I left permanent employment I'd be a contractor for a while, so I decided to take the ltd co. route. I secured a contract position and went about forming a company and appointing an accountant.

Choosing a firm of accountants came next. I knew I wouldn't need Deloittes or Ernst and Young as my accounting affairs would be quite simple - I wouldn't be buying any stock, have huge numbers of customers or renting/purchasing any company premises.

I approached a small local firm with the typical high street shop window. They seemed like nice guys, they charged a standard set fee payable at the time of my year end accounts, a fixed quarterly fee for VAT, payroll and PAYE plus admin fees for letters and calls to them.

They provided a very efficient service, but there were a few things that I did find a problem:

1. Bookkeeping - antiquated systems that involved me sending paper copies of sales invoices, purchase invoices and receipts for business expenses to my accountant quarterly - believe me this is a real pain photocopying everything and sending it all recorded delivery.

2. Not contractor friendly - issues around IR35, Managed Service Company and Personal Services Company legislation weren't easily answered and I often came away feeling I should really do my own research to protect myself.

3. Complicated fee structure which left me not knowing exactly how much I would be paying at the end of the year. It wasn't that the fees were excessive, it was just that they were unpredictable.

4. The elusive accountant - yes the firm was friendly and yes it did live up to it's promises and SLA's. However, I often wasn't able to speak to my accountant as he was frequently out meeting larger clients.

From one who knows, I can tell you now that you need a lot of advice and support when you first start out and if your accountant isn't there at the time you call it is very annoying.

I felt their expertise really sat with companies who employed people, purchased stock, had company premises, numerous customers etc - in other words typical limited companies not IT contractors.

After my first year of trading and chats with colleagues, I decided to look at other options. One contractor mentioned having a chat with his accountant at SJD. After meeting up with him I decided I wanted to change but really didn't know what was involved.

What's involved in changing accountants?

Basically sending a letter telling them I was changing!

I discussed my concerns about changing accountants with SJD. It appeared that the cost of change is zero and they would sort out all the transfer issues. I would obviously have to pay any outstanding costs with my previous accountant, which didn't amount to much, as most work is done around year end.

What was the difference between the high street firm and a specialist firm?

1. Nearly all of their clients are contractors, freelancers and consultants. So what I hear you ask? Well what this meant for me was they had heard just about every question I chose to ask about a hundred times already and knew the answers immediately - this filled me with confidence.

2. They know what contractors lives are like and are always there, they weren't out meeting larger more important clients or auditing companies.

3. They have offices everywhere and indeed had an office near me. Being local is vitally important to me. I like to know should the need arise I can always pop in and have a chat, especially if I don't understand something.

4. Bookkeeping - all done electronically on a spreadsheet and e-mailed monthly. Gone are the days of my visits to the local post office.

5. They knew all about the latest legislation that would affect contractors and indeed emailed me before I called about key changes, they also text me when special dates were due.

6. Simple one fixed fee price which meant no surprise bills. They were roughly still the same price as the other guys - it's just the fees were spread more evenly.

For me the move was easy, as I say there is nothing wrong with using a traditional shop front firm, they delivered on what they promised but I just got the feeling I was a square peg in a round hole."

If you have any question about contracting or would like any further advice please call our new client services helpdesk on 0500 152500 / 01442 275789 or email nikki.hanlon@sjdaccountancy.com.

For all other life stories, visit our Life as a Contractor Case Studies hub here, or click on the links below:

Appoint SJD Accountancy and never worry about your tax or accountancy affairs again!

SJD Accountancy

SJD Accountancy are the UK's largest specialist provider of fixed fee, Limited company accountancy services to contractors; we've been acting for contractors across the UK since 1992 and have more than 15,000 clients.

We are the only national specialist firm of contractor accountants with offices nationwide. SJD Accountancy has more qualified staff than any other firm in our market with qualifications from the following major tax and accountancy bodies - ATT, AAT, CTA, ACCA, CA, ACA and FCCA.

  • Unlimited face to face meetings. This is a unique service only SJD Accountancy offers - unlimited face to face meetings across the UK - tax is complicated and sometimes only a meeting will do.
  • UK's Largest contractor accountants with more qualified staff. No call centres, no outsourcing, no automated call handling. Simply telephone, email or meet your own dedicated accountant* face to face.
  • Money back service guarantee. All your telephone calls and emails will be answered the same day or we will make a full refund of that months fee.
  • Outstanding reputation. We have won more awards for customer service and accountancy excellence than any other firm in our market, including: Best Accountant for Contractors, Accountant of the Year and Best Professional Service Team to name just a few.
  • All inclusive low cost fixed fee accountancy package which includes completion of accounts*, payroll bureau, dividends and corporation tax computations, personal taxation, free bookkeeping software, your own dedicated accountant* and all company returns for a fixed fee of £120 plus VAT per month.

If you have any questions about contracting or would like any further advice please call our new client services helpdesk on 01442 275789 or email: janice@sjdaccountancy.com. Our new client services helpdesk is open Monday to Friday (8am to 6pm).

Appoint SJD Accountancy and never worry about your tax or accountancy affairs again.

Form your own Limited company with SJD - our same day online company formation service includes company bank account set up, VAT/PAYE registration and advice on optimum share structure. 

You may also find the following pages, guides and case studies useful:

*If you would like us to complete your company year end accounts we simply ask that you have been a client of SJD for one year or have made 12 monthly payments. All accountants are part or fully qualified.