As with any purchase in life, a key consideration is cost, the same applies to considering accountancy fees.
The fear of being ripped off, not getting a fair price and perhaps not even fully understanding what an accountant does, means that quite rightly business owners want to be cost conscious and understand what they’re getting for their money. No one wants to suffer from buyers remorse!
So, how are accountants fees calculated?
Why do some accountants only charge £19.50 per month, while others charge a lot higher fees?
One of the factors in accountants determining their fees, is the differing levels of qualifications, experience and expertise. For example, if you’re a multi-national organisation, then you’ll go for the big boys for the level of experience and knowledge required and in some cases the prestige associated with having a Big 4 accountant.
Choosing the right accountant for you, your business and your goals should be carefully thought out.
So what are the options?
The Cheap as Chips Offering
These guys are the ones who are:
- Maybe online, so limited real human contact
- May have few or limited qualifications and expertise
- May make you sign up to their software to make the accounts process as slick as possible their side
- They may be a one man band, or a small set up which have priced themselves low (strategy may be a cost leader)
- May rely on volume work,
- Likely to be able to bolt on other services including other compliance areas such as bookkeeping, VAT returns and payroll, but not offer a full spectrum, outside the box thinking (efficient tax strategies, deep diving into your business and ways to achieve your goals etc).
They’re perfect if what you want is the compliance to be sorted, especially if you’ve heard about them from someone else. Someone who will just sort that piece of paper out for you and ensure your taxes are filed.
The Traditional Accountant, the typical high-street accountant
These guys will deliver the following:
- Free consultation to understand your business
- Possibly meets you to sign accounts
- Can bolt on other compliance – VAT/Payroll/Self Assessment Tax Return/Bookkeeping/Refer other professionals if they’re aware of an issue/
- Possibly won’t be in looking into tax strategy/things we can be saving/thinking outside the box in terms of you as a business owner how you can save tax, achieve your goals, grow the business/etc
- Will be at the end of the phone for a question when you ask it
- These guys may charge a bit more, have varying qualification levels
The new age accountants
These guys will:
- Understands you as a business owner, your business goals and personal goals and will dive deep into your business to help you achieve your goals
- Invests time in you at the outset to understand how you can work together best
- Challenge you/keeps you accountable/understand your goals/your business/saves tax/sees the relationship as being part of your business rather a service
- Lots of bolt on to drive your business
- Have the expertise in house/have a great team they use on an often basis
- These guys may charge a similar price to traditional accountants , have varying qualification levels
The Big Boys
There’s not much more to say on these guys. You’d use these if you need the status of having a top named firm, need their whole collection of services they offer, and you have deep pockets. Also, if you’re owned by an overseas company, or a Venture capitalist. They’re brimming full of varying individuals with an immense amount of expertise and trained to a high standard from audit, to corporate finance to insolvency.
Each company is unique and whilst an accountant may offer, all of these services, it has to be the right one for you, your budget, your needs…