Does Your Business Need An Accountant?

If you are already one of our accountancy clients, we’re understandably delighted with your choice (and hopefully you are too!). But, even if you’re not a client, we thought it might be helpful to outline some of the considerations you might want to think about when it comes to your business. The chances are, that if you have set up a limited company, at some point, you will be wondering what the deal is with accountants. Do you have to have one? Do you ‘need’ one? Where is the benefit of having an accountant? Are they value for money? The list goes on and on. So, hopefully, this post will go some way towards answering some of the questions you have.

Does your business have to have an accountant?

By law, no! You do not require one as it is not a statutory obligation. But it might as well be given the amount of work that you would otherwise need to do yourself! There is no getting away from the fact that if you do not have an accountant, the onus is very much on you.

Does your business ‘need’ an accountant?

If you’ve set up a limited company, you will be required to prepare an annual set of registrar accounts which must be filed with Companies House. You must also have a full set of annual accounts and tax return that you will be required to submit to HMRC. And let’s not forget the personal tax returns needed for directors! For financial years beginning on or after 1 January 2016, companies are exempt from being audited, providing they have at least two of the following:

  • an annual turnover not exceeding £10.2 million
  • assets worth no more than £5.1 million
  • No more than 50 employees on average

The only exception is if one of the shareholders who owns at least 10% of the shares demands an audit.  So, whether or not your business ‘needs’ an accountant will depend largely on the expertise and time you have to commit to these tasks. 

Where is the benefit of having an accountant?

The answer to this question primarily lies in summing up what an accountant does. People often believe that accountants simply compile your year-end accounts and submit your VAT returns. But, a good accountant will help with a wide range of other duties too. These may include:

  • Registering the company with the relevant tax departments – VAT, Corporation Tax, PAYE 
  • Setting up and running the company payroll, in line with the Real Time Information (RTI) rules    
  • Monthly bookkeeping 
  • Dealing with the authorities on an ongoing basis (HMRC, Companies House)
  • Offering tax planning advice
  • Providing dividend advice
  • Giving professional references for mortgages, lettings, other services
  • Dealing with all ‘making tax digital’ requirements

Services will differ from accountant to accountant. So, if you do decide your business needs an accountant, make sure you know what is included upfront. 

Are accountants value for money?

Many people find they simply do not have the time or expertise needed to have peace of mind that their accounts are in order. As such, having an accountant relieve you of this burden can be invaluable in freeing up time and alleviating pressure so that you can focus on running your business successfully.  An accountant’s job is to provide you with advice. So, when you have queries about what expenses you can offset against Corporation Tax, or want to be sure you have enough retained profit to declare a dividend legally, you have a direct port of call.

Whatever the issue, knowing you have an experienced professional on hand can be extremely reassuring. Also, accountants come into their own when it comes to dealing with tax authorities should any query arise. They will know the correct format for submitting information and will understand the many (and complicated) subtleties of different regulations.

It is also worth pointing out that if you decide to look after your own business affairs, you must maintain your accounts in line with the Generally Accepted Accounting Principles in the UK. So, it becomes your responsibility to submit your business information in a timely and accurate manner that meets the requirements of the statutory legislation.

Weighing all of this up, on the whole people generally find that an accountant saves them both time and money, freeing them up to get on with running their business. At Lewis Brownlee Financial Services, our association with Lewis Brownlee Chartered Accountants means we can provide an ‘under one roof’ solution for anything financial. 

 

So, if you would like to speak to an adviser or an accountant, please do give us a call on 01243 767 469. Alternatively, you can email us from our contact page, and an adviser will be in touch.