A Guide to Accounting Companies in the UK

Posted by Hazel on April 20th, 2021

Small Accounting Firms

With tax day looming, many accounting firms in the UK are already starting to deal with contingency planning. They are starting to make contingency arrangements not just for the day of tax collection but also for the months and years ahead. By now most accountants in the UK will have already arranged their books and plans in order to get ready for April's return. One of the challenges that new or small accounting firms will face is how to cope with the tax regime in the UK when there are still a major global recession and uncertainties in the stock markets.

 UK Tax Regulations

The biggest headache for any company over the coming year will be the tax liability. There will be a large variety of accounting standards and UK tax regulations that need to be considered. As accounting firms are primarily company officers, it may be difficult to ask them to assess and implement your company's tax liabilities. Some accounting companies are equipped with expert debtors and tax advisors who can help clients understand the implications of the tax regime and develop strategies to minimize their UK liability. Some accounting firms are set up as limited partnerships (LPAs), so they are not tax limited. Other accounting companies in the UK which are fully tax qualified can advise and provide solutions over the full range of UK tax planning options.

Local UK Accounting Company

Tax advisors at accounting firms in the UK are able to help you establish an effective and profitable structure for your business, particularly if you are a UK non-domestic entity (NTFD). NTFDs are subject to different taxes according to their place of business, so it is essential that you understand the differences between these and the standard corporate tax rate in the UK. Most accounting firms in the UK also offer international accounting services, so you may find it easier to work with them for international tax matters than with a local UK accounting company. This international tax liability is especially relevant to firms based in low and medium-sized countries in the European Union.

Accounting Policies For UK Residents

Most accounting firms will be familiar with UK tax law, but you should ask them about their particular accounting policies for UK residents, particularly when it comes to paying dividends and capital gains. Some accounting companies have their own policies on this matter, but most will give you information on the subject from their website. Before starting your own consultancy, you need to ensure that you fully understand the risks involved and ensure you know what you are doing. The accountant's policy on this should be clearly mentioned on their website, so you know what to expect.

Accounting And Finance Services

Many accounting companies in the UK offer services beyond the accounting and finance function. You may require other services such as advice on setting up your company, or general business administration. Some accounting firms will offer these additional services in addition to their accounting and finance services. It is always worthwhile comparing these services with those offered by an individual consultant, because the additional services could help you save money and avoid unnecessary tax or transfer payments.

Accounting And Finance Function

The next thing you need to look at is whether the accounting companies in the UK offer a good range of services beyond the accounting and finance function. You might require accounting advice on setting up your business, or general administration advice. Some accounting firms will offer all these products and services, and some will only provide a small number of them. If you are just beginning your business, you may find that an accounting company that provides a wide range of products and services is the best choice. However, if you have a large business that you are managing daily, then you should consider hiring a specialist accountant that will only focus on your specific needs.

Accountant's Services

One more point to consider is the cost of the accountant's services. The larger accounting firms may be able to offer a discount rate on certain accounting services, which can make them even more affordable than smaller accounting companies. In order to get the best deal, it is worth shopping around and making comparisons between the different firms you are considering. Comparing the costs of different services will allow you to identify the one that is most suitable for your personal situation.

Bigger Accounting Companies

The majority of accounting companies in the UK offer competitive prices, but there are a few that may be slightly higher than others. This can depend on factors such as the company's location, size and scope, the quality of their services and the tax they charge. Smaller accounting companies will generally be able to offer a lower rate of tax, because they are not able to provide a wider range of products and services to their clients. Bigger accounting companies may also be able to offer lower rates of tax, because of their larger size, and therefore more customers, which will result in higher profits. Ultimately, the tax you pay should be based on your personal circumstances, as well as the needs of your business.