How to pick an accountant for a small business

You want a qualified accountant who uses the same software you do, charges a fixed monthly fee and picks up the phone when you’ve got a question in April.

A good accountant saves you more than they cost, in tax, time and mistakes you never make. A bad one costs you a lot more than their fee. There are accountants listed on WotsItCalled, and the gap between a proactive one and a once-a-year form-filler is huge. You can usually spot which is which before you hand over the books.

Check they’re actually qualified

In the UK anyone can call themselves an accountant, because the title isn’t protected. What you want is a chartered or certified qualification from a recognised body, and the main ones are:

• ACCA (Association of Chartered Certified Accountants): common in small business and general practice.
• ICAEW (Institute of Chartered Accountants in England and Wales): the traditional “chartered” route, more often found at larger firms.
• CIMA (Chartered Institute of Management Accountants): focused on management accounting and less common for tax work.
• AAT (Association of Accounting Technicians): a bookkeeper-level qualification, fine for simpler businesses, and they can work under a chartered supervisor.

Look them up on the professional body’s public register, which confirms they’re qualified, current and in good standing. If they won’t tell you who they’re qualified with, walk away.

Match the accountant to the size of your business

A Big Four firm won’t want your sole-trader tax return, and a bookkeeper isn’t going to run your R&D tax credit claim. The right level depends on where you are:

• Sole trader, under £50k turnover. A bookkeeper or small local practice is fine, as long as they can handle Self Assessment and basic VAT if you’re registered.
• Limited company, small. A small local practice, which should cover accounts, corporation tax, Self Assessment, payroll, VAT and Companies House filings for one monthly fee.
• Growing business. A practice with in-house tax specialists, because you’ll start needing advice on R&D claims, EMI schemes or the most tax-efficient way to pay yourself.
• Multi-director, complex structure. This is mid-tier firm territory. The fees are higher, but the advice pays for itself.

Getting the size wrong hurts either way. A tiny practice will drown in a complex business, and a big firm will treat a tiny one as an afterthought.

Software, automation, and how they work

A modern accountant works in cloud software. One who still wants a shoebox of receipts every March is holding you back. Ask:

• What accounting software do you use? Xero, QuickBooks, FreeAgent and Sage are all fine. No software at all, or something you’ve never heard of, is a red flag.
• Can I keep the licence and data if we part ways? You want to own your books. If they hold the licence hostage, you’re stuck.
• Do you use receipt-capture apps? With Dext, Hubdoc or AutoEntry you photograph a receipt and it lands in the accounts automatically.
• How often will you look at my numbers? Monthly is the bar. Once a year is form-filling, not accounting.

Pricing: fixed fees or hourly

Small business accountancy has mostly moved to fixed monthly fees, which works in your favour. You know what you’re paying, you can ring them without watching the clock, and they’ve priced the job on what’s actually involved.

• Typical range for a small Ltd. £60-200 a month depending on complexity, with turnover, staff numbers and VAT status all playing a part.
• What’s included. Annual accounts, corporation tax, the director’s Self Assessment, payroll for a few staff, VAT returns and Companies House filings. A decent proposal spells it out.
• What’s extra. R&D claims, tax planning, mortgage references and share structure changes are usually quoted separately.
• Watch for teaser pricing. “£29/month!” usually means year one only, with everything else charged as add-ons.

Six questions to ask on a first call

1. Who specifically will do my work? It might be the senior partner, a junior or an offshore team. Any of those can be fine, but you should know which.
2. How do you communicate? Email, phone or a client portal, and how quickly do they aim to reply?
3. What do you need from me, and when? A decent accountant has a monthly rhythm, such as documents in by the 7th and reports out by the 15th.
4. What’s your year-end process? Ask how long after year-end your accounts will be ready. Three months is quick, six is average and a year is lazy.
5. Have you worked with businesses like mine before? A consultancy, a shop, a tradesperson and a SaaS company all have different tax quirks, so industry experience matters.
6. What happens if I leave? Ask about your data, the notice period, the final bill and the handover. Good firms make leaving easy, and bad ones lock you in.

Where to start looking

The accountants directory covers small and mid-size practices across the UK, including Manchester, Liverpool, Leeds and Bristol. Pick three, book free intro calls and work through the questions above.

Switching accountants: how to do it cleanly

Switching is usually much easier than people fear. The new firm handles most of it through a standard process called “professional clearance”:

• Pick the new accountant first. Don’t leave the old one until the new one is lined up, because gaps lead to missed deadlines.
• Sign a new engagement letter. This sets out the scope and fees you’ve agreed with the new firm.
• They write to the old firm. The new firm asks for professional clearance and any documents held, and the old firm is professionally obliged to respond.
• Software access transfers. If you own your Xero or QuickBooks licence, you just add the new firm as an adviser. If the old firm owns it, you may need to migrate the data.
• Pay any outstanding bills. An old firm can legally hold on to documents over unpaid fees, so clear them.

The short version

• Anyone can call themselves an accountant, so check for a chartered or certified qualification.
• Match the size of the practice to the size of your business.
• Cloud software and fixed monthly fees are the modern standard.
• Ask who does your work, how often they’ll look at it and how long year-end takes.
• Make sure you own your books and can walk away cleanly.

WotsItCalled is a free UK business directory. No signup, no catch. Find the place everyone’s on about, or browse the full accountants directory.