The Importance of Hiring an Accountant for Your Small Business

If you run a small business, hiring an accountant is one of the best investments you can make. Running a business isn’t easy at the best of times, but the past few years have been truly exceptional. In a climate where companies are faced with challenging economic conditions, it’s important to seek the right professional advice and support.

Here are some key reasons why hiring an accountant for your small business is essential:

Expertise Beyond Bookkeeping

Accountants are more than just bookkeepers. While bookkeeping involves record-keeping, an accountant will provide professional analysis on a business’s finances and give comprehensive advice. They also take responsibility for complying with HMRC and Companies House filing deadlines and requirements. This expertise can help spot potential financial issues early on and reduce the risk of being investigated by HMRC.

Specialized Advisory Services

Depending on your budget and business needs, you might choose to hire both a bookkeeper and an accountant. An accountant can also advise on building a finance team as your business grows, including specialists like credit controllers or chartered tax advisers.

Managing Financial Pressures

Rising inflation, borrowing, and energy costs can put a squeeze on cash reserves. An accountant can help you manage these competing pressures and ensure your business stays financially healthy.

Compliance with HMRC Regulations

Self-employed individuals in the UK with annual business income of more than £10,000 will need to follow the Government’s Making Tax Digital rules from 6 April 2024. An accountant can help navigate these new rules and ensure your business is compliant.

Choosing the Right Accountant

When selecting an accountant for your small business, consider factors like their qualifications, expertise in your industry, location, and reputation. Look for chartered accountants with the right qualifications, training, and experience to meet your business needs. It’s also important to ensure the accountant understands your sector well and can provide both financial and business advice.

Initial Consultation

During your initial consultation with an accountant, discuss your business needs, service levels, fees, and the information required to proceed. Be clear about your financial concerns and provide necessary documents to help the accountant understand your business better.

Conclusion

Hiring an accountant for your small business is a crucial investment that can have a significant impact on your financial health and compliance with regulations. By choosing the right accountant and maintaining open communication, you can ensure your business receives the professional guidance it needs to thrive in challenging economic times.

Julie Corkish is head of practice at ICAEW

Further Reading

Explore more resources on accounting for start-ups, best accounting software for sole traders, and the benefits of hiring an accountant for your small business.