Contractor Accountants: How to Choose The Right One

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Choosing a contractor accountant can seem like an impossible task. It’s so hard to know what and who to believe, companies make such claims and of course, they all position their company’s strengths as the most important things to look for. For example, a company with only one office in the South of the country isn’t likely to suggest to a prospective client in the North that being able to meet with your accountant is a major benefit. Or a company that uses a call centre instead of dedicated accountants isn’t likely to say ‘well, of course, it’s best for you to have your own accountant rather than speak to somebody in a call centre who has no idea about you or your business goals’.

Can you meet your contractor accountant?

Tax is complicated! Sure you could manage your tax affairs both personal and corporate over the telephone or online but, and it is a big but, what happens if you need to discuss something sensitive or complicated face to face? Approximately 50% of SJD Accountancy’s 15,000 contractor clients meet up with their own dedicated accountant at least once during the time they are with us – you can meet your SJD accountant in an office across the UK.

Do you get your own dedicated accountant?

You want a dedicated accountant or tax expert, not an account manager, a support team or even a partner. You want somebody who you can speak to, email, meet and who has the time to learn all about you and understand what your business and personal goals are and you will only get this from a dedicated accountant or tax expert. The same goes for using an online-only system, which we cover a little later on, online systems can be great but you still ideally need your own accountant to discuss your business plans with.

Is the company established and are they contractor accountant specialists?

Obviously, the longer and more experienced the better.

How much do they charge?

Most charges fixed fees and charge similar prices give or take a few pounds, it is worth making sure there are no entry or exit fees and that their fees aren’t linked to how much you earn. Also make sure they will cover your personal taxation as well, if not how much do they charge extra for this? SJD Accountancy offers an all-inclusive fixed fee package for contractors, for more information visit our accountancy packages page.

Are they IR35 experts?

Tax is a very broad subject with a multitude of disciplines, so it makes sense to appoint a contractor accountant with a long history of IR35 experience.

SJD are one of a few firms in the UK who advise IPSE on IR35 and so are well qualified to give you the correct advice. For more information, download our guide on IR35.

A small or large company?

Nobody wants to discuss their personal and business tax affairs with a large faceless organisation. However, most people would like the backing, credibility, reputation and a general secure feeling of a large reputable company. You can get the personal 1-2-1 service of a small company simply by choosing a large company where you get your own dedicated accountant, this way you get the best of both worlds.

Online or offline bookkeeping?

Actually, it makes little difference. The most important part is the delivery and support you receive.

It’s doubtful that you’ll be completing your bookkeeping whilst on the train or grabbing a coffee in the local coffee shop, you’ll probably end up doing it at home where you can spread your receipts out, so it doesn’t really matter if it’s on or offline. The most important things is that it’s simple to complete and you can ask your accountant to check it for you after.

One thing to consider with online systems is what happens if you wish to leave if there is a dispute or the online provider goes bankrupt? Unlike simple offline bookkeeping spreadsheets, you hold all your own data, whereas with an online system your data is held centrally, which means your account could be suspended or even closed without your knowledge or permission. For example – What happens if you are dissatisfied with the service and wish to leave? How do you retrieve your data if the online provider closes your account? Many online systems providers will close your account if you stop paying them making it rather difficult to access past financial data that you’ve uploaded.

It’s a good idea to check that you can back-up your data locally, plus find out what would happen to your data if you decided to leave.

Third party references – are their awards worth anything or did they just buy them?

There is a growing trend for companies to have an array of meaningless awards and accreditations on their website to help add credibility. However, it is always best to do your research and actually establish what the award is for and who has provided it. Is it a professional body or a highly regarded third party source? Or is it yet another website that simply sells awards to the highest bidder with the UK’s top, UK’s Best, UK’s leading XXX company changing hands each week?

SJD has won more awards for customer service and accountancy excellence than any other firm in their market, these are from some of the most established industry bodies, including; Accountancy Age, Contractor UK, The Sunday Times, National Customer Service Awards, National Business Awards, Best Companies Accreditation and the Institute of Customer Service, to name just a few. For a full list of SJD Accountancy awards and accreditations click here.

There are lots of other questions you could ask to establish the credentials of your accountant, however, these are a few key ones.

Choosing an accountant

What do you look for when you hire an accountant? Essentially, you are looking for a firm that can provide the following:

  • Gives you a dedicated point of contact
  • If you are self-employed, it would help if the firm is a dedicated contractor accountant
  • Provides the opportunity to meet with your accountant
  • Nationwide offices
  • Offers a low cost all inclusive fixed fee
  • Has a good reputation
  • Offers some kind of guarantee on their service

The detail

One of the most daunting things when contracting through your own Limited company can be getting an accountant. At first glance it’s easy; you go down to your local high street accountant who quotes you anything from £1,000 – £2,000 plus VAT to do your end of year accounts for you and you’re covered. However, this probably won’t include VAT returns, personal tax or your payroll.

However, throughout the year you may have accountancy and tax related queries and questions for your accountant – you may need to call them for some bespoke advice. Each time you call your accountant, you’re likely to be charged, so by the end of the year you could be looking at a bill exceeding £2,500. It’s no surprise then that most contractors and small business owners soon stop calling their accountant and push their tax returns to the back of the drawer.

So it makes sound business sense to appoint a good accountant who is right for you. Not only will they be able to help with initial set-up issues such as registering your limited company, they will also be able to advise you on a myriad of complex financial issues, and ultimately to make sure that you keep as much of your hard earned turnover as you can. You’ll have enough on your plate with running your business, and the last thing you need to worry about is missing a tax deadline, making sure that your tax submission is accurate, or missing out on any opportunity to maximise your tax allowances.

Factors to consider

Small Fish big pond

You could be forgiven for thinking that it doesn’t really matter which accountant you choose as they are all the same, providing that they are qualified. But this is definitely not the case. For example, it makes no sense to choose an accountancy firm who predominantly provides services to larger businesses, and may consequently not understand the needs of a smaller company such as yours, or even have much time for you. In this situation, you may well find yourself being a very small fish in a very big pond.

No dedicated accountant

Another aspect to consider is customer service. Some firms operate a system where you speak to a different person every time and no-one ever really gets a clear understanding of your business and its individual issues. You will also probably find yourself repeating things over and over again if you have to call back multiple times. This option might be cheaper on the face of it – but at an overall level, when you consider the extra time which you will have to take, it could work out more expensive.

The UK tax system is complicated. To give you an idea, the HM Revenue and Customs Expenses Policy booklet is over 100 pages long, so just imagine what the corporation tax laws look like. With this in mind, it makes sense to have a dedicated tax advisor who you can pick up the phone to, or email when you need an answer to a question – without worrying that they are charging you for every minute, or that you are wasting their time asking what might appear, to them, to be ‘simple questions’. This will give you a certain level of comfort and reassurance to know that if you don’t understand something, or if you have any concerns, you can talk to ‘your’ accountant anytime you like. After all it’s you and your company, not them, that will be personally liable if anything goes wrong!

You may find the following guides useful:

To appoint SJD Accountancy as your accountants, the quickest and easiest way to do so is by completing our Client Agreement Form.

If you would like to know more about how contracting works, forming a limited company or just want to have a chat about tax or going limited, please don’t hesitate to contact a member of our New Business Team on 01442 275789 or email:

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