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As a small business owner, you might be wondering whether hiring a small business accountant is a necessary investment. In this guide, we'll explore whether you need to use an accountancy firm, and how to find a good accountant if you need one.

Do I need an accountant for my small business?

The role of an accountant in a small business extends far beyond number crunching. While it might seem tempting to handle your business finances independently, a professional accountant can add immense value. They serve as financial advisors, helping you make informed decisions, ensuring compliance with HMRC regulations. They may also oversee cash flows and tax returns and provide strategic insights for business growth.

Both small business owners and sole traders often use accountants, even if just for their tax return. However, if you find accounts and bookkeeping particularly challenging, you might want to consider accessing an accountant more regularly. You could also consider one of the many monthly virtual accounting software options available.

What does an accountant do for small businesses?

Accountants for small businesses wear many hats. They manage bookkeeping, handle payroll, assist with tax preparation, and offer financial analysis to guide your business decisions. In addition, they can provide valuable insights into cost management. This can help you optimise your expenses and improve the overall financial efficiency of the business.

A good accountant will be aware of your business plans in order to make clear recommendations in real time. This is more than just doing annual accounts or data entry. It means having a financial expert in your corner to help you work towards growth.

What qualifications does an accountant need?

Choosing the right accountant is crucial. Not all individuals using the title "accountant" are professionally qualified. Look for accountants who have completed a professional qualification, involving exams and work experience. 

Verify their current membership with a professional body, which signifies their commitment to high standards and ongoing professional development. They might belong to the Institute of Chartered Accountants in England and Wales, or the Chartered Institute of Management Accountants.

Not all accountants need to be chartered, but it is often a sign of their expertise, dedication and experience.

How do I choose an accountant for my business?

1. Check their credentials

Selecting the right accountant involves careful consideration of various factors. Look for professionals affiliated with reputable UK accountancy bodies, such as AIA, and inquire about their qualifications and experience. 

2. Compare services

Consider the services they offer, including bookkeeping, tax assessment, and online accounting software integration. Do they offer everything you need? How does it align with what you currently need support on? Will it make paying your employees or submitting your tax returns easier? 

3. Compare costs

Assess their fees, keeping in mind that unusually low charges may raise concerns about the quality of service. Also consider who will be doing the work for you. Will you be working with an experienced accountant, or will one of their juniors be your main point of contact? If you’re a smaller business anticipating growth soon, will they be able to accommodate you in the future?

4. Read reviews

Seek referrals and read reviews to make sure you choose an accountant with a track record of happy customers. Speak to other professionals about their accounting and what works for them, you may find a traditional, local firm that’s perfect for you, or a more modern option based on your needs.

5. Look for industry experience

An accountant who is familiar with your industry, or with the stage of your business is a win. For example, if they have other clients who are also start ups, or offering a similar service, they will likely know how to deal with any financial issues that come up, or be able to best direct you in line with your business goals.

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A small business accountant plays a pivotal role in ensuring the financial health and compliance of your enterprise. Choosing a qualified and experienced professional is essential for long-term success. Keep in mind the importance of ongoing professional development and adherence to ethical guidelines, as outlined by reputable accountancy bodies like AIA.

Opting for a qualified accountant not only ensures compliance with HMRC regulations but also provides a safeguard against potential risks. By choosing a small business accountant, you are making a proactive investment in the success and sustainability of your business.

Learn more about our business support services by booking a free 15 minute consultation with one of our expert lawyers or by calling us on 020 3808 8314.


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In closing

Nothing in this article constitutes legal advice on which you should rely. The article is provided for general information purposes only. Professional legal advice should always be sought before taking any action relating to or relying on the content of this article. Our Platform Terms of Use apply to this article.

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