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Find the right accountancy solution for your requirements

When you first start contracting, it can be tempting to think you’ll be able to handle all of your own finances. After all, it’s just sending out invoices and filling in a tax return, right? Well, if you really want to make the most of your tax efficiencies (and if you want to make your life easier), it’s worth investing in a quality accountant.

Now, as a contractor, it’s likely to be the case that you’ll have some specific needs that a general accountant may not have experience with—that’s why we’d recommend seeking out an accountant who specialises in contracting. To help, we’ve put together this guide on what to look for when choosing a contractor accountant.


What is a contractor accountant?
A contractor accountant is a professional person or firm who is qualified to handle your financial accounts, with a particular focus on contracting regulations, legislation and maximising income for contractors.


Why use a contractor accountant?
While the average high street accountant will be able to help you comply with your tax liabilities, your contracting business is going to require a level of specialist knowledge that they may not have had experience of previously.

For example, an accountant who has contractor experience will have particular knowledge of complex areas such as the latest IR35 legislation. Going with an accountant who doesn’t know about these contractor-specific issues could cost you dearly in the long term.


What qualifications should a contractor accountant have?
If you’re trusting someone to look after the financial affairs of your business, it’s worth your while to do some digging on their credentials. Luckily, the UK accountancy industry has three globally-recognised qualifications. They are:

  • Associate Chartered Accountant (ACA)
  • Associate Chartered Certified Accountant (ACCA)
  • Chartered Institute of Management Accountants (CIMA)

Beyond the big three it’s also worth looking out for tax-specific qualifications, such as Associate Taxation Technician (ATT), Associate Accounting Technician (ATT), and Chartered Tax Adviser (CTA) status.


Which membership bodies should a contractor accountant be affiliated with?
The contractor accountancy industry has two main membership bodies, giving you a sure-fire way to be certain that the accountant you’re considering has the specialist knowledge you need. They are:

  • Freelancer & Contractor Services Association (FCSA)
  • Association of Independent Professionals and the Self Employed (IPSE)

Both of these bodies provide their members with the most up-to-date information on changing regulations and standards within the world of contracting—it’s information that will mean your finances are being dealt with in the most compliant and effective way.


What fees will a contractor accountant charge?
Before you enter into any dealings with your chosen accountant, be sure to find out exactly what their fee does and doesn’t include. You should expect to receive services such as corporation tax returns, annual accounts, self-assessment, payroll, VAT returns, and references as part of your fee.

Also, find out whether there will be an additional cost for one-off services, such as an IR35 review, or whether it’s included in your monthly payment. In addition to this, it might be worth enquiring on the availability (and cost) of add-on services like business insurance and personal finance advice.


What software and online portals should a contractor accountant offer?
As with most things in modern business, carrying out your contracting financial affairs can be done wholly online. But do you want a more traditional accountant, who needs to be provided with all details on paper? Or would you be happier with an approach where everything is done via an online portal?

Asking yourself these questions (and, in turn asking your prospective contracting accountant about them) will enable you to get a service better suited to your needs. Additionally, if you currently use specific accounting software, remember to question your accountant on whether they are familiar with that software. Incompatibility could lead to inconvenience or increased costs, neither of which is good for your business.


Should a contractor accountant that has been recommended take preference?
As a rule of thumb, always listen closely to the recommendations and advice of fellow contractors before committing to a decision. Ask around at networking events; drop industry friends an email or message; invite an experienced contracting colleague for a coffee and pick their brains about the accountants they use.

A genuine recommendation from a respected peer is worth its weight in gold, so put in the work to gather opinions at an early stage in the process.

We hope you’ve found this guide useful. If you’re looking for more advice, guidance, and tips on building your business, be sure to check out our list of resources, here.


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