It’s a debatable question. Much like do I need a car? Or do I need a smartphone or iPad? Most people don’t actually need a car to get about and could take public transport, walk or ride a bike. But having a car, even though it costs more, can make your life a whole lot easier and happier!
You don’t need a smartphone to make a call or send a text, and some people get by with a £20 handset. But having a smartphone that connects you to a world of endless options, even though it costs more, can again make your life so much easier and save you masses of time!
Can I file my own accounts and tax return?
Some people fix their own cars. Sometimes this is fine, but sometimes the car breaks down on the motorway due to it not being fixed properly.
There’s nothing to stop you doing your own accounts, tax return, payroll or VAT return. There’s plenty of software out there that can help you, but good software will cost you, and are you confident it’ll be correct? Can you keep up with regular changes in tax, VAT and employment law, like Auto Enrolment and Minimum Wage? And if you’re a limited company, the filing requirements and how you withdraw money out of the company complicate things a bit more.
What are the benefits of having an accountant?
- Peace of mind that everything is filed on time and correctly!
- Saves you time! You don’t have to do all the work yourself, and using apps like Xero and Receipt Bank can make things even easier!
- Can help you get finance! Having an accountant prepare your accounts is often required by lenders to approve loans.
- Saves you money! Accountants will claim all the tax reliefs you’re entitled to, meaning you pay less tax!
- Helps you stay in control! Good accountants will give you regular updates on what tax you owe and how much you can take from the company, helping you plan and make good business decisions.
What are the common problems with not having an accountant?
In our experience with clients who do their own accounts/tax/payroll/VAT etc, the main things that happen are:
- Wrong figures submitted to HMRC (resulting in paying too much tax or getting fines).
- Don’t realise how much tax/VAT is owed and business has to go into liquidation because they can’t afford to pay HMRC.
- Directors take too much money out of the business and pay illegal dividends.
- Claim for wrong expenses (we’ve had a case of someone claiming for a pet budgie!).
- Don’t claim enough expenses (end up paying too much tax).
- Get bogged down in paperwork and end up working nights and weekends to keep on top of things.
Overall you can try and be a super hero and do everything needed for your business, but when there’s help available, is it worth it?
For a small business, having support from an expert for say £99 plus VAT per month, works out at £3.90 per day! That’s the price of a coffee in most places or a bottle of your favourite beer! The time saved in not having to deal with piles of paper work and submitting them to via an app is worth it alone.
You know where we are if you need us!