If you are running a limited company, it is not a statutory requirement to appoint an accountancy firm to look after your finances. You can handle your accounting duties by yourself, if you choose.
So why would you choose to hire an accountant?
Although it isn’t required, the vast majority of limited company owners do appoint accountants to handle their accounts. There are many reasons for this, and really an accountant does far more than merely compile your accounts at the end of the year and submit VAT returns. The multitude of other duties they undertake include:
– Setting up/running company payroll, in compliance with new RTI rules
– Registering the company with the appropriate tax departments
– Providing advice for tax and dividend administration
– Dealing with correspondence with bodies like HMRC and Companies House
– Providing professional references
If you are in need of advice on things like expenses that can be offset against Corporation Tax or whether or not your profit warrants a legal declaration of a dividend, an accountant will be able to help you with ease.
If you opt to go it alone, you must be sure to regulate and maintain your accounts in compliance with generally accepted accountancy practice. Information must be submitted promptly and accurately, and you must meet your company’s statutory obligations.
That said, companies are actually exempt from being put through an audit if the following criteria are met:
1. The company has to be ‘small’, defined as meeting 2 of the following 3 conditions: annual turnover below £6.5m; fewer than 50 employees; balance sheet turnover below £3.26m.
2. If any of the members of the company demand an audit (with the assumption they hold 10% of shares or 10% of all the members in the case of a company limited by guarantee).
This definition will encompass the majority of business owners who are questioning whether or not to use an accountant.
You should also take into account the amount of time you will have to devote to preparing your accounts, as well as book-keeping and communicating with HMRC. The time you will lose on this should be compared to the cost of a typical small business accountant before you make your final decision.
An accountant can save you both time and money, and give you the freedom to focus on running your business while someone else worries about the numbers. Feel free to have a look over the services we offer and see if we could make the running of your limited company easier for you.