Do I need an accountant?
You may think you can’t afford an accountant or you're simply comfortable that you can do it all yourself, but before deciding to take care of the finances yourself, look at how long it would take you and how much new information you'd have to acquire.
If you have a limited company then you should have an accountant in some capacity as the legislation governing small business accounts is always changing and the cost to keep up with these changes alone will likely be more than an average accountant would charge (All ACCA members need to do a minimum of 40 hours of CPD per year). Our Limited company packages start at £80/month + VAT and you can see more information on our services
For sole traders, it's a different scenario and many people do it themselves with few repercussions other than some lost time. However, they may be missing opportunities to reduce tax, making mistakes, missing deadlines or claiming for things that they shouldn't be. Our sole trader packages start at just £40/month + VAT and you can see more information on our services
Even if you were comfortable that your situation was fairly simple and you've done a tax return before, it's still going to take you several hours at a minimum to gather your information, check it and submit it to HMRC. So really you need to weigh up how much your time is worth and compare that to what an accountant would charge. When you add in the peace of mind that you've got experts doing it for you and you've got those experts year-round to help you out if you're unsure of anything, getting an accountant might be a great investment.
How much does an accountant cost?
The reason most accountants don't add their fees to their website is that in reality, the answer is always 'it depends'. Without an in-depth conversation, we're not going to be able to give you an accurate quote but we'll try our best to give you a ball-park figure. You can see full details of our pricing structure here, but there are some outlines of what you can expect to pay below (prices are based on a contractor/consultant/freelancer style business):
If you're operating through a limited company we'll charge a minimum of £80/month + VAT. In more than 50% of cases, this starting package will cover everything a client needs. The most common reason for the cost to be more than this is that you want us to do VAT returns, multiple tax returns, multiple payrolls or want to use our address as the registered office. Many clients that require some of these extra services often take advantage of the £125/month + VAT package that includes VAT returns, 2 tax returns, 2 people on the payroll, plus a quarterly review of your financial data.
If you're a sole trader we'll charge a minimum of £40 + VAT. While this is a starting price, it covers the vast majority of the sole trader clients we have. The most common reasons for increases in this fee are if you want us to do VAT returns or you a more complex tax return due to a rental property or considerable investments.
Should I be a operating as a sole trader or through a limited company?
There are many benefits to operating through a limited company but most of the benefits won't make any difference if your business is very simple and you're only making £15k profit each year.
If your profit goes over £20k, then you will likely be able to reduce your tax bill by becoming a limited company but the added complication and the cost of an accountant are probably going to cancel out the tax saving. As a general rule, if your profit goes over £30k, you'll be better off operating through a limited company and the higher the profit figure, the better off you'll be.
Other benefits of being a limited company can be:
-You look bigger/more professional/more established;
-Limited liability so the business going under doesn't mean your automatically liable for its debts;
-Better access to potential funding;
-You could sell your business at some point.
We have a free app with a helpful calculator that will estimate the tax saving for you operating as a limited company. Download for
What are my resposibilities if I start a company?
There are many benefits to starting a limited company but as a director, you have certain responsibilities. Directors must abide by the Companies Act 2006 but if like most of us, you don't have 2 weeks free to familiarise yourself with the companies act, it basically says that you need to operate with a bit of common sense and not do anything illegal.
As a director, you must also act in the interest of the company rather than yourself so you shouldn't take money out for personal use if it means the company can't pay it's bills as a result. You also need to keep good records, file annual accounts, file a company tax return, keep Companies House up to date and pay the annual £13 Companies House fee. If you don't do these things, you could potentially be held personally responsible despite your limited liability.
Our minimum fee of £80/month + VAT for contractors covers all these responsibilities and we like to do them way before the dealines to ensure you have complete peace of mind.
For more information on starting a limited company, see an article we wrote Feb 2020
What makes Focus different from other accountants?
In a nutshell, we deliver high levels of customer service, employ innovative technology to help automate as much of your bookkeeping as possible and we're small enough to develop real relationships with our clients.
We are fully aware that we're not the cheapest accountant around and we never want to be. The 'pile it high - sell it cheap' style of accountant sometimes works well for people who have very simple circumstances and just want to keep the taxman at bay. We focus on high-quality customer service and we like to really get to know our clients in order to take advantage of every possibility to minimise unnecessary tax. We often recommend changes to a business structure that end up saving our clients thousands in tax off the back of a general chat at the end of a meeting that simply couldn't happen without a genuine interest in our clients.
We don't hide the fact that we're a small firm as we're proud to be able to manoeuvre legislation changes, technological innovation and changing environments more easily than bigger firms. It also means that if you call us, you'll probably recognise the voice on the other end of the phone and they'll know your circumstances so issues can be resolved quickly and without the hassle of giving a secretary your life story before being able to speak to someone that might remember working on your accounts.
Cloud accountancy services, e-signatures and bank feeds are now common-place in many modern accountancy firms but we were early adopters of these technologies. As we're a small team, the cost of new software licenses and the time it takes to train up the team is considerably lower allowing us to take advantage of technological innovation before our competitors. We've started using FreeAgent back in 2014 when they were still a fairly small team so we have a great relationship with them and know the software back-to-front. This allows us to deal with any software queries ourselves rather than sending you to the support team.
How does the fixed monthly fee work?
Our fixed monthly fee is not just a standard annual fee for all the services charged on a monthly basis, it's for the work we do in each month. Some months we might not do much and some months we might do a lot but the fee usually stays the same unless you ask us for extra services.
There is no contract, so you're not tied in and you don't have agree to a minimum of 12 months or anything like that. If it's not working after a few months, we can simply part ways.
Our fees rarely increase unless you add more services to our agreement but in occasional cases, we might have underquoted for a job that appeared much simpler. In these circumstances we will propose a new fee along with the reasons for that fee so you have the option to proceed or not. We'll never give you an unexpeted bill or retrospectively increase our fees.
Our fees are based on a client coming to us with no outstanding accounts so if you have accounts outstanding for a period that has already ended, we might need to charge a 'catch-up fee'. This cost will depend on the circumstances, usually works out to £500-£1,000 and is charged as a one off fee when the accounts are completed.
What would working with Focus be like?
We tailor our services to the individual client so no two client relationships are the same but there are always fundamentals that make up the foundation of our service. Many of our best relationships are with clients that like to meet face to face to go through their accounts and get a full understanding of what we've done. On the other hand, the tech we use allows us to work very efficiently with clients on a 100% remote basis.
Ideally, the sign-up process starts with getting in touch with us and arranging a free, no-obligation meeting with Barry. By the end of the meeting, we're usually in a position either offer our services along with a quote or give you some advice on what to do next if working with us isn't the best way forward. If a face to face meeting isn't possible, we're happy to do this via Skype, a phone call or email but a meeting is always preferred.
If we agree on a package and a fee, we'll get you set up on our secure, online client portal where you'll be able to sign an agreement between us and view important documents and references. We'll get authorised to talk to HMRC about your affairs, register for any taxes, set up a company, set up a FreeAgent account or anything else that might help get the business running.
Through the year
This is the part that varies most as we offer unlimited support through the year so usually, we are in regular contact with clients for at least the first few months to clear up any initial queries. After the initial period, we might only be in touch 5-10 times a year to talk about important legislation changes, tax planning or your accounts but we'll never be the type of accountant that just does a set of accounts for you then you don't hear from for a year. If you need more support, we're always happy to help and try our best to respond to all emails within 1 working day and can usually be reached on the phone during office hours for more urgent queries.
Accounts and tax returns
We like to get things done early! If you're used to scrambling around in January to get your records together for your tax return and submitting accounts on deadline day then you might be in for a shock. We tend to request records within a month of your year-end and usually complete accounts within a month of receiving the records. With our clients using FreeAgent, we already have most of the information we need so it's not unusual to be submitting accounts within a few weeks of the year-end.
We like to meet our clients to run through the accounts and sign everything off but we don't insist on this and are happy to go through them remotely and e-sign all the documents in our secure client portal.
Working in this way means you know exactly how much tax you need to pay months before the deadline. There's also less pressure, less stress, less chance of mistakes and as we're working with recent data, we can give you better advice to help your business thrive.
There are no contracts with us so you can leave at any point. Whether you take a PAYE job, retire or simply want to switch accountants, we'll help you as much as we can, maintain our service levels, and assist in the transition. In some circumstances where you're closing a company down or just temporarily ceasing to trade we try to offer a reduced fee so you can still take advantage of our support and advice but not spend too much money when the business isn't making any.