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Do I need an accountant for my limited company?

As sole owner and director, you will know your business inside out. You earn the money, you know what’s being spent and you are responsible for building your customer base to ensure its longevity. You may even feel that you know a fair bit about managing accounts, so does every limited company contractor really need an accountant?

While not a statutory requirement there are many contractors who do choose to pay for such assistance. A good contractor accountant won’t just provide general bookkeeping services or simple compile your accounts at year end.

How to Decide If I Need An Accountant

They undertake a multitude of other duties, including:

  • Company registration with all the relevant VAT, Corporation Tax & PAYE departments
  • Payroll set up including submissions and payslips in accordance with RTI reporting
  • Registration for the Flat Rate VAT Scheme which could save you money
  • Quarterly VAT returns & Management accounts in addition to the yearend accounts
  • Dealing with company-related correspondence & compliance issues (Companies House, HMRC)
  • Tax management and planning including advice with IR35 & risk assessment
  • Dividend advice and assistance with paperwork
  • Ongoing company administration (such as change of address or share changes)
  • Tax efficiencies and savings

More than just filing your limited company accounts

Crucially, hiring a contractor accountant can free you up to run your business and they will assist with the bigger picture to really maximise the potential of your contracting career. Your accountant will navigate the maze of exemptions, deductions, filing deadlines and legislation so that you can focus solely on your contracted work and don’t get bogged down with processing invoices and receipts.

Just as not every car owner needs a mechanic, hiring an accountant to do your taxes isn’t a necessity. However many contractors find that that additional support and advice offered by an accountant means they can rest assured that their financial affairs are well looked after and that they can make considerable savings and larger profits in the longer term.

Limited Company Accounts

How do I decide if I need an accountant?

The best way to determine if you need an accountant is to ask yourself some key questions about your finances, such as:

  • Do I know what qualities for a business expense and am I claiming all the expenses that I can?
  • Do I know how to make best use of my personal tax allowance?
  • What statutory obligations do I have?
  • When are all of the filing deadlines and which ones are required for limited companies?
  • Do I know how to compute my Corporation Tax liability?
  • Do I need to be VAT registered?
  • Would the Flat Rate Scheme be beneficial to my business?
  • Do I know how to issue a dividend voucher?

Once you have answered them, ask yourself again do you need an accountant? Our guess is that for the majority of limited company contractors, the in-depth advice and detailed guidance offered by an accountant is the lifeline to a successful business.

Considering switching accountant?

More than just maintaining an accurate profit and loss account or balance sheet, limited company accountants have responsibility for some fairly complex accounting and filing requirements. But, if your current accountant isn’t meeting your needs, whether that be due to charging excessive fees, inadequate service level or simply not asking the right questions, you can always change – and usually with minimal interruption to your business.

At Umbrella Exchange we know contractors don’t always conform to a traditional 9-5 routine, so you need an accountancy partner that understands you needs and appreciates a flexible workings style. By finding an accountant through us we can ensure you receive the best service at an even better value!

We won’t charge for our information and are providers don’t demand any moving fees. We’ll also help handle the switching process for you.

Find a contractor accountant

At Umbrella Exchange we know how important it is to find an accountant that will help your business operate efficiently and profitably with the minimum amount of stress for you.

That’s why we ensure that the providers we partner with offer:

An expert service

Straightforward accounting either via an online portal or cloud accounting system

Options for fixed monthly fees

Assistance with limited company formation

Opportunity to have your own dedicated Accountant & receive proactive advice

In depth knowledge of contractor specific matters such as IR35 or whether you could use the Flat Rate VAT Scheme.

Willing to go the extra mile to deliver more than you expect

 

If you would like to be put in touch with a reputable accountant, we’re happy to help.

Further reading:

Undecided about your options? View our payment options comparison table.

Delve deeper into the practicalities of running a limited company.

Limited Company - Umbrella Exchange

The paperwork and filing requirements for limited company contractors.