Do we need an accountant?

[Shakti]

I have been contracting for over 6 months now. Have got a steady accountant who charges around £100 a month. And frankly I don't see him doing much. Yes, I understand what they say that most work is at the year end when they file all paperwork for us, but I don't see it being £1200 worth of work? So my question to all of you?

Do all of you use accountants? If I use a accounting system to manage my accounts, ( most produce the balance sheet, vat return amounts etc. ), then how risky it is?

I was thinking of using Freeagentcentral which I found does directors pay, dividend certificates, VAT and Corp Tax calculations etc. So how difficult is to take this information and then file them all online myself?

[FarmerPalmer]

I used an accountant before, but now do it all myself.
I was doing my VAT before and my own bookkeeping and had figues that matched what the accountant came out with.
Its easier now with the HMRC PAYE software.

VAT is simple, especially if flat rate

PAYE - just use the HMRC PAYE CD

Corporation Tax - use a spreadsheet and crib what your accountant used to d for you.

If you can get a spreadsheet to get the same numbers as they generate then you are on your way.

[BolshieBastard]

I always use an accountant. It isnt just the 'figure' work they do either, its keeping abreast with not just personal tax issues but also company tax issues.

I've also got better things to do with my time instead of trawling through figures, receipts, invoices and tax bulletins etc on a regular basis.

Face it, if your daily rate is £300 a day, over the course of a year you'll probably spend more than 4 days of your time keeping your accounts upto date, filing returns on time etc, etc.

To me, its false economy to do the accounts and all the associated work yourself.

[minestrone]

Do you not have to be a 'registered' accountant to do corporation tax?

[Shakti]

Hmm... The fact is I just could not understand the logic of a contractors worth of time. People always say that if they do any extra work, then they are loosing out of time which they can earn money. How many contractors work more than 8 hours a day? So I am sure it is possible to spare a few hours in the evenings or weekends doing things on our own and saving some money.

Also the time I spend filling out excel sheets for expense claims etc. can be utilised to handle my accounts directly in some accounting system. I think what I will do is shift to a low cost accountant, who can do my year end filing, and use Freeagent Central to manage my accounts on my own. I think I will get more visibility into my accounts this way than the profit calculation sheet an accountant sends me.

Thanks for the help guys. Will check out the HMRC Paye CD.

[BolshieBastard]

Hmm... The fact is I just could not understand the logic of a contractors worth of time. People always say that if they do any extra work, then they are loosing out of time which they can earn money. How many contractors work more than 8 hours a day? So I am sure it is possible to spare a few hours in the evenings or weekends doing things on our own and saving some money.

Also the time I spend filling out excel sheets for expense claims etc. can be utilised to handle my accounts directly in some accounting system. I think what I will do is shift to a low cost accountant, who can do my year end filing, and use Freeagent Central to manage my accounts on my own. I think I will get more visibility into my accounts this way than the profit calculation sheet an accountant sends me.

Thanks for the help guys. Will check out the HMRC Paye CD.

Obviously, you havent spent much time yet doing spreadsheet etc in the spare time that you have.

Trust me, the 'spare time' I have, I would far rather spend it chilling out, doing my hobby stuff, getting exercise etc, etc than filling in spreadsheets all to save a couple of hundred quid.

[Ruprect]

Anyone use these guys?

http://www.accountsnet.com/

There was an advert in the PCG mag and they're about 1/2 the price of SJD. Any experiences here?

[sweetandsour]

I have been contracting for over 6 months now. Have got a steady accountant who charges around £100 a month. And frankly I don't see him doing much. Yes, I understand what they say that most work is at the year end when they file all paperwork for us, but I don't see it being £1200 worth of work? So my question to all of you?

Do all of you use accountants? If I use a accounting system to manage my accounts, ( most produce the balance sheet, vat return amounts etc. ), then how risky it is?

I was thinking of using Freeagentcentral which I found does directors pay, dividend certificates, VAT and Corp Tax calculations etc. So how difficult is to take this information and then file them all online myself?

There are some people who say that they can manage to produce their own accounts and statutory returns without any issues and I don't doubt that for a moment.

There will always be people who try to save a few quid by doing their own accounts, making their own bread, servicing their own car, performing their own brain-surgery, those sorts of things.

To my mind, there are potentially any number of things that might change during the year from the Companies House returns, Corporation Tax, PAYE etc. Therefore I am happy to pay for an Accountant who will tell me when any of those changes affect me, which is more valuable to me than any form filling they might do.

[NotAllThere]

Do you not have to be a 'registered' accountant to do corporation tax?

No.

[PhilAtBFCA]

Do You Need An Accountant

Hi Shakti

You do not have to use an accountant, you could do it all yourself.

I believe you use FreeAgent, which like some other packages goes a long way down the process of producing final accounts.

You may need an accountant to help you with what is tax deductible and what is not.

During the financial year for your company, and the fiscal year for your taxes you get up to date management information and can make informed decisions about your dividends and salary levels - if you keep up to date.

You may need to take advise from an accountant or search online to find out how to make the decisions based on the information you see.

You could file accounts with HMRC and Companies House online, it may take some time to do that , but could get easier once you get the hang of it.

Your question has ben asked many times and I hope that one answer is that an accountant can provide value and tax saving opportunities that are greater than their cost. An accountant that specialises in your business sector could be useful too, they get asked the same questions as you have so should be able to give the answer.

IR35 is the same issue. You could do a contract reveiew yourself, you could get an accountant to do it, you could get one of the specialist firms to do it.

As systems like FreeAgent does more of this work that we used to do as accountants our fee model has changed, as has the focus of our work, and I can see this question being asked many more times in the future !

Maybe the question to ask is - Can you satisfy yourself that you have acted with reasonable care in all the accounting and tax decisions that you make if you undertake all the work yourself. ( Reasonable Care because of the new HMRC penalty regime ).

Phil