Choosing someone to pick an accountant as a freelancer or contractor can be hard. However, this guide will help you make the right decision.
1. Look for someone who specializes in your industry.
As a general rule of thumb, any accountant should be able to handle your books. However, you may get better results by looking for an accountant who specializes in your particular industry.
Accountants who have taken the time to learn the ins and outs of a specific industry can generally provide you with far better service than general accountants. General accountants tend to work with many different types of businesses. Although this makes them versatile, they may not know as much detailed information about your industry as a specialist.
Typically, accountants who specialize in a particular type of accounting charge a flat-rate fee for their services on a monthly basis. This fee usually includes everything from managing your accounts to dealing with payroll, handling your tax return, and providing you with support as needed. When looking for an accountant, make sure to read the list of services that are included in each package carefully. That way, you can be sure that you are getting all of the services that you need.
By going with a specialist rather than a general accountant, you can rest easy, knowing that they are extremely knowledgeable about matters that directly impact your business. For instance, they can help you deal with issues related to IR35 or other factors that apply specifically to your industry.
In many cases, accountants may offer cloud-based services. Depending on the setup, the cloud storage may be managed by the company or they may rely on an outside cloud provider such as Xero or Free Agent. In many cases, the cloud platform is designed to integrate with accounting tools such as Receipt Bank. Typically, these services are a much better choice than old-fashioned accounting firms that rely on spreadsheets.
Over the past couple of decades, the number of accountants working with contractors and freelancers has increased. Typically, these accounting firms offer a variety of different packages. For contractors who can manage most of their accounting issues on their own, they have basic support packages. For contractors who need more support, however, they have all-inclusive packages that cover every aspect of accounting including tax planning.
2. Make sure the accountant is qualified.
Accounting firms that specialize in working with freelancers or consultants are typically operated by professionally qualified chartered accountants. This can give you a lot of peace of mind, knowing that your books are in good hands. Always make sure that any accountants who will be working on your books are fully qualified for the job.
3. Choose the right size firm.
Accounting firms can vary significantly in size. Some have relatively few clients while others serve thousands.
The level of service that you receive from the firm can be impacted by the number of clients that they have. For instance, accounting firms with thousands of clients usually provide a more institutional experience for their clients, whereas smaller firms tend to approach their accounting with a more personal touch.
If you want to be able to talk to the same person every time you call in for support, you should consider going with a smaller firm. Larger firms will usually direct your call to one of many different accountants, meaning that you may have to talk to someone different every time you call.
4. Ask around for recommendations.
Chances are, you know other people who work as contractors. Consider asking them to recommend an accountant.
Keep in mind, as well, that it is usually easier to switch accounting firms if you are working with a company that offers cloud-based services. Even if the firm that you choose is perfect for your needs right now, you may need to switch to a different firm in the future if your business grows or changes.
5. Consider the cost.
Find out what the average going rate for a typical accounting package is for contractors.
Once you know approximately how much you should be charged, it is much easier to compare prices. Keep in mind, however, that different accounting packages provide different levels of service suggest VAT Global. For instance, a package that covers all of your accounting needs will naturally be more expensive than one that provides less support. If you choose a smaller package, you may need to pay extra for additional services such as having your personal tax return completed.
As a general rule of thumb, you should avoid the cheapest accounting services, opting for a service that provides more support at a reasonable price.
6. Switching to a different accountant.
If you choose the wrong accountant, you can always change to a different one instead. Although this can be a little bit challenging, things should get back to normal within very little time after the switch.
In some cases, your business might grow so much that your current accountant can't handle the amount of work that you are sending their way or isn't qualified to provide you with the advice that you need. For instance, if you are used to working independently but suddenly hire employees, you may need a larger accounting firm or a firm that specializes in working with small businesses instead.
You may want to think about the future when choosing an accounting firm. Some firms provide multiple levels of support. That means that you can move up to a larger support package at the same firm without having to move all of your information to a different company.