It is essential that you know your accountant’s charges, what the fees are based on and what services they include. Some have a fixed annual fee to complete accounts, business tax calculations and file documents, while others charge by the hour although this is becoming less common. Ask for a fixed annual fee to cover all the services you need. Fees may vary depending on the seniority of the person doing the work. If it is not a fixed annual fee, ask the firm for an estimate of what the annual fee will be and be prepared to challenge the final bill if it exceeds this.
Charges will vary according to your location, the size and complexity of your business and the size of the accountancy firm you have chosen. Fees are likely to start from around £100 per month the for preparation of management and annual accounts and tax computations if you are a sole trader and not registered for VAT.
Larger, more complex businesses that are registered for VAT should expect to pay at least £250 per month and often more. However, choosing a firm that charges the least can sometimes be false economy, instead, look for the one that adds value. For example, will photocopying and phone time be included in the cost or be extra?
Ask your friends, family and other business owners to recommend an accountant and then talk to at least three different accountants; ask them each to provide a detailed list of the services they will supply and a quote. Ask them whether they charge extra for phone calls and email support (they shouldn’t).