Do I need an accountant for a startup business? 

We are accountants for startups, are Chartered Certified and speak to many start-up businesses. Not every starter business is the same. You could have big ambitions with more than one shareholder in your start-up, or it could quite simply be a part-time self-employment with no team members. Whether you are starting or whether you have ambitions to grow quickly, there is nothing to lose in at least having a chat with an accountant because most of them will offer a free consultation.

What is a free consultation?

The vast majority of accountants should offer a free consultation. Why would they offer this for free? The truth is it’s in their benefit as well as yours to at least offer this first meet at no cost. As the start-up business owner, you could get some valuable advice that could literally save you thousands of pounds in the first few years of your business and as the accountant, you’ve got the potential to build a long-term relationship with the owner.

A free consultation with an accountant to discuss your tax requirements, business structure in terms of whether you should be self-employed or to company and also your bookkeeping requirements.

What bookkeeping responsibilities do I have for a startup business?

As a starter business it is often tempting to skip getting yourself set up on proper bookkeeping software. Providers such as QuickBooks, Xero, Sage and FreeAgent just to name a few have dedicated packages designed for smaller businesses. Why wouldn’t you want to utilise that?

The truth is that most start-ups don’t have the certainty to know how successful their business is going to be in the first year, and they are reluctant to invest too heavily in costs that are not essential.

This comes down to perspective, as 80% of start-ups fail in the first five years. One of the main reasons they fail is the lack of financial knowledge in terms of understanding their numbers and what drives their success. Having a proper bookkeeping system is the foundation of this and only in the smallest of instances — so for example if you are likely to have revenue below, let’s say £20,000 per annum — would I suggest not going all in with software on day one.

How can an accountant for startups help me?

At the most foundational and basic level, an accountant should point you in the right direction in terms of your business structure, your tax responsibilities and your bookkeeping system.

However, there is a huge spectrum of additional advice and support you could benefit from when engaging with an accountant for your business starter. Not all accountants are equal. As the odds are stacked against a new business start-up, it would be sensible to also seek some form of business advice. This doesn’t necessarily mean you need a business coach or you need a proper business consultant, but it does mean you should get some form of guidance to steer you in the right direction. A modern entrepreneurial accountant can be a great starting point to put you on the pathway to build a successful business in year one.

How much does an accountant for my UK startup business cost?

Prices vary greatly depending on the level of support you are looking for as a business start-up. If you are looking for just fundamental end-of-year guidance to file your tax return, then it can cost as little as £30 plus VAT per month.

If however, you are looking for business planning advice, marketing support, and general business mentoring and coaching support as well as bookkeeping services, it could potentially cost up to £500 per month. The exact cost would depend on various factors such as: are you a limited company (which will generally cost a lot more than a sole trader or partnership), how big the business is that you are building, how many you have on your payroll, how many bookkeeping transactions you have, and what level of general support you are looking for from an accountant.

Do you offer a free consultation to help me set up my startup business?

Yes at Gro Profit First Accountants we offer a free consultation to discuss your needs and we can cover all of the points discussed in this blog including your tax filing requirements, your bookkeeping system, your business structure and also any other areas you need guidance with.

You can book a free meeting from this link.

FAQ For Accountant For UK Startups

1) Is it expensive to hire an accountant for a business startup?

Generally speaking it is not expensive if you’re starting a small self-employment business as a start-up in the first year. However, it does depend on your circumstances — for instance, if you are starting a company with 12 people on your payroll, it will require a much bigger investment than starting a small self-employment business.

2) Do I need an accountant when I start my business?

You don’t legally need to have an accountant. However, I would highly recommend you have an accountant if you are a limited company. If you are self-employed the process can be easier in terms of filing your end-of-year tax return, however it is still best practice to at least book a free consultation with an accountant to understand what your responsibilities are.

3) How can a start-up accountant benefit me?

80% of businesses fail within the first five years. One of the main drivers for struggling businesses is the lack of financial understanding. A good accountant will help you understand your numbers and make sure you plan for your tax, plan for your VAT, PAYE, national insurance etc, so that you don’t get caught out.

There are so many different taxes you need to consider as a business owner and a good accountant can simplify the whole process. This allows you to focus on growing your business and doing what you do best. An entrepreneurial accountant can even help you grow your business with sound business advice around your finances, marketing, systems, automation etc.