Category: Accounting

Ways To Manage Your Tax Planning

The Need for Tax Planning

What Is Tax Planning?

Tax planning is the practice of using effective strategies to delay or avoid taxes. When you sit down and make a tax plan with your tax planning advisor, you look at ways to defer or avoid taxes by taking advantage of provisions in the tax law that benefit taxpayers. You find ways to accumulate and speed up tax credits and tax deductions. Tax planning means taking advantage of every tax break available to you under the federal tax code.

Tax planning goes hand-in-hand with financial planning, which means making a plan to achieve your short- and long-term financial goals. It is hard to effectively financially plan for your current situation or your future without employing tax planning strategies to meet those goals.

If you enjoy financial success, taxes will be a large expense. Cutting down on those taxes or even eliminating them when possible is an important element of preserving your wealth.

The main purpose of tax planning is to make sure you approach taxes efficiently. Tax planning reduces your tax liability by employing effective strategies that explore ways that not only decrease taxes but secure a more solid future and retirement. It does not matter whether you make $50,000 a year or $500,000 a year. When you take the time to make a tax plan, you will find numerous ways to save money.


General areas of tax planning

There are several general areas of tax planning that apply to all sorts of small businesses. These areas include the choice of accounting and inventory-valuation methods, the timing of equipment purchases, the spreading of business income among family members, and the selection of tax-favored benefit plans and investments. There are also some areas of tax planning that are specific to certain business forms—i.e., sole proprietorships, partnerships, C corporations, and S corporations. Some of the general tax planning strategies are described below:

Accounting Methods

Accounting methods refer to the basic rules and guidelines under which businesses keep their financial records and prepare their financial reports. There are two main accounting methods used for record-keeping: the cash basis and the accrual basis. Small business owners must decide which method to use depending on the legal form of the business, its sales volume, whether it extends credit to customers, and the tax requirements set forth by the Internal Revenue Service (IRS). The choice of accounting method is an issue in tax planning, as it can affect the amount of taxes owed by a small business in a given year.

Accounting records prepared using the cash basis recognize income and expenses according to real-time cash flow. Income is recorded upon receipt of funds, rather than based upon when it is actually earned, and expenses are recorded as they are paid, rather than as they are actually incurred. Under this accounting method, therefore, it is possible to defer taxable income by delaying billing so that payment is not received in the current year. Likewise, it is possible to accelerate expenses by paying them as soon as the bills are received, in advance of the due date. The cash method is simpler than the accrual method, it provides a more accurate picture of cash flow, and income is not subject to taxation until the money is actually received.

In contrast, the accrual basis makes a greater effort to recognize income and expenses in the period to which they apply, regardless of whether or not money has changed hands. Under this system, revenue is recorded when it is earned, rather than when payment is received, and expenses recorded when they are incurred, rather than when payment is made. The main advantage of the accrual method is that it provides a more accurate picture of how a business is performing over the long-term than the cash method. The main disadvantages are that it is more complex than the cash basis, and that income taxes may be owed on revenue before payment is actually received. However, the accrual basis may yield favorable tax results for companies that have few receivables and large current liabilities.

Under generally accepted accounting principles (GAAP), the accrual basis of accounting is required for all businesses that handle inventory, from small retailers to large manufacturers. It is also required for corporations and partnerships that have gross sales over $5 million per year, though there are exceptions for farming businesses and qualified personal service corporations—such as doctors, lawyers, accountants, and consultants. Other businesses generally can decide which accounting method to use based on the relative tax savings it provides.


Why Should I Tax Plan?

The main reason to tax plan is to ultimately have more money that you can either invest in new projects, save or even spend. Or do all three. The choice is yours.

There are more good reasons for tax planning.

  1. Strategic Tax Planning and Tax Management Can Lower Your Taxes

In the end, tax planning is all about reducing your tax bill. Keep in mind that tax planning:

  • Is especially important if you own a business or if you are self-employed
  • Makes sense if your investments have hefty unrealized losses or gains
  • Is useful when you experience a major event in your life, such as getting married or divorced, having a baby, buying a home or retiring
  • Is helpful if you move to a new job or sustain a significant change in your income, either up or down
  • Can help you save money if you are sending one of your children to college for the first time
  1. Tax Planning Gives You Time to Strategize and Get the Most Out of Your Benefits

Too often, people wait until the very last second to try to use a tax benefit. While this works on occasion, effective tax planning requires that you allow for time to study the situation and make the appropriate decisions. Smart tax planning happens all year long, not on the last day of the year or the day before your taxes are due.

  1. Tax Planning Lets You Take Advantage of Changes the IRS Makes

Tax laws are always a little different every year. Very often, there are only minor changes, but after 2017, tax laws looked significantly different. Tax planning allows you to ready for these changes, whether minor or major, and make decisions about how you wish to deal with them and how they will affect your taxes.

  1. Tax Planning Helps You Avoid Deadline Dread

Regardless of changes the government makes to tax laws, decisions about how you want to deal with these changes and with your taxes every year have a firm deadline of midnight on April 15. Tax planning at the appropriate time means you are well prepared to deal with any contingency and in no danger of suffering deadline dread. A tax planning consultant ensures you are ready.


Types of Tax Planning

There are a few different types of tax planning that are useful for individual people, companies and organisations. Some of the tax plans include; short term tax plans, long term tax plans, permissive tax plans and purposive tax plans. The short term planning allows you to reduce taxes at the end of the income year. Long term plans allow you to plan at the end of the beginning or end of the year, permissive tax plans are permissible under different law provisions. The purposive tax plan gives you the chance to make different investments.

How It Works

When you start tax planning, you can find many guides online and you can also speak to financial advisors and solicitors to help get you started and give you all the important information that you will need to know. For example, each person has an inheritance tax allowance up to £325,000 with anything over the threshold being charged at 40%. So, if an estate was valued at £400,000, only £75,000 of that would be taxed. Since the majority of people won’t leave an estate over this amount, most feel they don’t need to know about inheritance tax. However, actively considering it and your future can help you to avoid any nasty surprises later on.


What Are Strategic Income Tax Planning Strategies for Individuals?

When you work with a tax or wealth advisor, you can develop strategies to reduce your tax bill, save money and plan for your future. Here are several tax strategies you might want to consider that reflect the importance of taxes for personal finance planning.

  1. Make the Most of Tax-Efficient Accounts

In most cases, this means taking advantage of retirement savings plans. Depending on which type of plan you choose, you can reduce your current tax bill or your future tax bill.

Whether you choose a traditional IRA, 401(k), a Roth IRA, or a Roth 401(k) they are all subject to limits on how much you can contribute. The amount is quite different between all four, and so it is smart to talk to a tax consultant about what might be the best plan for you.

Traditional 401(k)s and IRAs are the best idea when you want to defer taxes until later. Roth 401(k)s and IRAs are the best choices when you want an investment that offers you tax-free potential growth.

  1. Mix And Match Your Accounts

When you split your contributions among various types of accounts, whether they are retirement savings plans or brokerage accounts, you give yourself space to determine what your future taxes will be and how to deal with them. This is only possible if you take the time now to create different accounts that allow you to diversify your taxes.

  1. Reduce Your Taxable Income

Reducing your income does not mean you want to make less money every year. It does mean you take a look at strategies that could decrease your Adjusted Gross Income (AGI) by using effective tax strategies. This includes:

Putting contributions into retirement savings plans

Making donations to charity

Using investment losses to reduce your income

  1. Implement Personal Income Tax Planning Strategies for Investors

Everyone wants to invest wisely, of course, but there are specific investments that provide generous tax benefits. For instance, you do not pay federal taxes on municipal bonds, and that is often true of state and local taxes as well. Managers of taxed-manage mutual funds work hard to ensure they are tax efficient. There are many other types of similar investments you can make, so it is important to talk to your tax advisor to understand what the tax benefits may be connected to different kinds of investments.

  1. Connect Your Investments With the Right Type of Account

It does not make much sense to have tax-efficient investments if you are not putting them in the right place. You want to make sure your investments work with accounts that offer the best tax treatment. For instance, if you have investments like taxable bonds or stock funds that generate income, it is smarter to hold them in a tax-deferred account like a traditional IRA. This will give you the greatest potential benefits.

  1. Hold Onto Your Investments to Avoid Higher Capital Gains Taxes

Normally, it does not make sense to keep a stock that you want to sell only because you want to avoid taxes. Sometimes, however, you do want to hold off on selling an investment. For instance, if you sell stocks that you held for less than a year, they will be taxed at your ordinary income rate.

If you wait longer than a year to sell stocks, they are taxed with a long-term capital gains rate. In many cases, a long-term capital gain rate will be significantly less than your regular income tax rate. Before you decide to sell a stock, check with your tax advisor about tax implications.

  1. Employ Your Losses to Offset Your Gains

If you have any investment losses, use them to offset your gains on investments. Tax gain-loss harvesting can minimize your tax liability. If you lose more on your investments than you gain, you can then use those losses to offset as much as $3,000 of earned income in a single year. So if you make $50,000 a year, but you lost $3,000 in investments, your taxable income would only be $47,000. You can also carry additional losses forward.

Get Organized For Tax Preparation

Can a tax preparer take your refund?

Can you trust your tax preparer?

While many legitimate professionals prepare taxes, the IRS has been warning consumers to be careful when it comes to dealing with unethical preparers and fly-by-night outfits.

Sometimes a con artist will keep repeating the same old tricks and won’t be easily caught — such as the ongoing story of the door-to-door tax preparer.

Taxpayers are warned to choose their tax preparers carefully. Don’t just trust someone who is making big promises — or is the friend of a friend. Don’t get taken by outlandish promises on social media where some preparers claim to get you the biggest tax refund possible.


Millions of Americans are looking forward to a tax refund this year.

To receive yours as soon as possible, the IRS recommends filing your tax return electronically and choosing direct deposit. About 90% of taxpayers who use this method and are owed a refund get theirs within 21 days of submitting their return.

Many Americans are eligible for free federal tax filing, but if you earn freelance income or have an otherwise complicated tax situation, you will likely need to pay tax filing fees to prepare your federal and state returns.

If you use an online service, you can start preparing your return for free. Most tax preparers don’t require money up front; you’ll typically pay the fees once you’re ready to sign and submit your return.

The IRS estimates it takes the average person about four hours to complete and file their return. By the time you reach the screen asking for payment, you’re probably looking for the quickest exit route. Online preparers will give you the option to pay for their services via credit or debit card or through your refund.

If you check the box to pay through your refund, you don’t have to do anything on your end but simply wait for your share of the refund to be deposited in your bank account. Sure, that may sound easy, but be careful: Most preparers tack on an extra fee for this method of payment, and it’s not insignificant.


Paying your online tax preparer through your refund could cost you up to $40 extra

Online service each charge an additional processing fee of $40 if you agree to pay through your refund. That’s $40 on top of the fee you’re paying for the package you selected, meaning you could easily double what you expected to pay. and, two of the best budget tax software options, charge an additional fee of $25 to deduct their fee from your refund. TaxAct charges its own fee plus bank fees.

That’s not to say these online tax preparers aren’t worth your time. In fact, they’re among the best options on the market. But if you want to make the most of your refund, don’t settle for the easiest option — take an extra minute to pull out your credit card and avoid the unnecessary processing fee.

If you can, use a rewards credit card to pay for online tax prep and filing instead of deducting the amount from your refund. There’s usually no service charge to pay via credit card; you’ll be able to earn rewards points or cash back, depending on the card you have; and you’ll get your tax refund in full.


Tax Return Preparer Fraud

Even if you hire a tax return preparer who you believe is professional and honest, tax return preparer fraud (also referred to as return preparer fraud and preparer fraud) or misconduct is something that can happen to anyone. For example: A tax return preparer (also referred to as a return preparer) might change your tax return after you’ve approved and signed it, altering income or credits to obtain a bigger refund and then keeping some or all of it.

In some cases, the return preparer might steal your whole refund by changing direct deposit information. Another common fraud situation is when the preparer files a tax return without your authorization. They might have your information from a prior year and use it to file a tax return for the current year. Or perhaps you met with a return preparer and then chose not to hire them, but the return preparer filed a tax return using your information anyway.

To avoid problems:

  • Be careful when choosing a tax return preparer;
  • Know what steps to take to protect yourself; and
  • Know what to do if you’re the victim of return preparer fraud or misconduct.


How will this affect me?

If you’re the victim of return preparer fraud or misconduct, you’ll need to show it to the IRS. If the IRS rejects your claim, you may face additional issues, including liability arising from the fraud or misconduct.

It’s important to get a copy of the tax return at the time you authorize the return preparer to file it on your behalf (see above on how to authorize) because later you may have to show the IRS that the return preparer altered your tax return after you signed it.

Following the steps in the “What Should I Do?” section will help you establish your case, especially providing the IRS with the signed copy of the tax return your preparer gave you, showing your correct bank account number and address.

If you’ve given the IRS the signed copy of the original tax return, the Taxpayer Advocate Service believes the IRS has sufficient guidance to take corrective actions, including issuing any refund still due to you. If the IRS doesn’t agree with this position, you should contact the Taxpayer Advocate Service and ask for help.

Four End Of Year Tax Planning Strategies

What is Tax Planning?

Everybody deals with finances—it’s often just done in different ways. One way to work with your finances is through tax planning. Tax planning is a process that helps you reduce the amount of taxes you’ll owe at the end of each year. There are a number of ways you can go about tax planning, but it primarily involves three basic methods: reducing your overall income, increasing your number of tax deductions throughout the year, and taking advantage of certain tax credits.

Why is Tax Planning Important?

The reason why tax planning is important is simple: it saves money and helps you avoid overpaying your taxes. Aside from that, however, tax planning will help you better understand what you’re spending money on and how you can get rewarded for planning for retirement or advancing your education.


Strategic Tax Planning is something you most likely aren’t receiving from your CPA. There are a few reasons why this is true.

  • Accountants only understand a small portion of the tax code. Instead of being future focused, they are more interested in historical record keeping. While some may provide reactive tax advice, they are unaware of how to proactively and strategically make the tax code work in your favor.
  • Accountants are likely to have Type-A personalities. While that’s great for plugging numbers into boxes, it means they probably aren’t flexible or open to change. A strategic tax planner must take into account the small business owner’s lifestyle, short and long-term financial goals, and spending habits.
  • Accountants err on the side of caution. Though there are over 70,000 pages of green lights in the tax code, accountants tend to focus on the five pages of red lights to avoid being flagged by the IRS. It’s important to understand, however, that a green light is not the same as a “loophole.” It’s not a “red flag” to go through the intersection and it does not increase your risk of getting a ticket because you “used” this particular law to get through the intersection. Remember, the tax code was meant to be used, not feared.


A lower tax bill is within reach

So you want to pay less tax in 2019. Who doesn’t? The good news is, there are ways to reduce the amount of money that you send to the IRS — legally, without allegations of tax evasion. In fact, there are plenty of steps you can take to cut your federal and state tax bills. And, the sooner you start, the more things you can do to reduce the taxes you’ll owe.

Contribute as much as you can to retirement accounts

Want to set yourself up for the future while slashing your tax bill at the same time? Contribute to tax-advantaged retirement accounts such as a 401(k) and IRA. Unless you opt for a Roth account, you can take deductions for your contributions in the year you make them. This enables you to deduct a lot of money. You can contribute up to $19,000 to a 401(k) and up to $6,000 to an IRA in 2019. You can also make additional catch-up contributions of $6,000 to a 401(k) and $1,000 to an IRA if you’re over 50.

Take advantage of tax loss harvesting

If you have losing investments, selling them allows you to harvest your losses to offset taxes on investment gains or to reduce your taxable income by up to $3,000.

This strategy can be especially beneficial if your income is going to be higher than normal and you want to avoid being pushed into a higher tax bracket, or if you’re going to be selling investments that you’ll need to pay short-term capital gains on.

Keep track of your medical costs

If you incur substantial medical expenses, you may be able to take a deduction for the funds you spent.  In 2019, you can deduct unreimbursed allowable medical expenses only if they exceed 10% of your income — up from 7.5% in 2017 and 2018. You’ll need to itemize to claim this deduction — which doesn’t make sense for many tax payers due to the large standard deduction. Still, you should keep the bills you incur throughout the year. If your costs are high enough to hit the threshold for deductibility, you want to be able to take advantage of the tax savings to offset some of your big care expenses.

Put some cash into flexible spending plans

If your employer offers flexible spending accounts, you should likely take advantage of them.

You can make contributions to an FSA with pre-tax funds to pay qualifying out-of-pocket medical expenses. You could potentially also enroll in a dependent care FSA to pay for services such as child care or care for a disabled relative. It’s important to know the rules for FSA contributions. You’ll usually have to enroll in an FSA during open enrollment with your employer, and many plans are structured so if you don’t spend your contributions, you lose them. Still, if you know you’re going to have out-of-pocket medical costs or dependent care costs to pay, you should strongly consider putting some money into the FSA to reduce your taxable income and make these expenditures effectively cost less.



Smart Qualified Plans

On a more pedestrian note, business owners can often use tax deductible retirement plans much more to their advantage than is typically the case, if the objective (as it nearly always is) is to pile up tax deductions while putting way more dollars in owners’ accounts than for employees. I say pedestrian because this is really business tax planning 101, straight down the fairway, but I am continuously amazed at how often it is missed by even high-dollar tax advisors. I recall a case where a Manhattan CPA advised a fellow to use a SEP, with deductions in the $20K range. Mind you this client lives near NY and pays NY State and municipal income taxes on top of the Federal burden, meaning he really got whacked. We showed him how, in his fact pattern, using a 401(k) would more than double his CPA-suggested deduction, but that what he really needed (and eventually did) was a defined benefit plan, boosting deductions to about $150K a year. The guy saved pushing $100K a year in taxes, like waving a wand.


Invest in Registered AccountsTax-Free Savings Account (TFSA)

In addition to investing in a TFSA of your own, consider making a gift to your adult family members or spouse to enable them to contribute to a TFSA. All the investment income in the TFSA grows tax-free and future withdrawals are not taxable. Further, there will generally be no income attribution, regardless of who funds the account. If gifting to your spouse, attribution will not apply so long as the funds remain invested in the TFSA.

Registered Retirement Savings Plan (RRSP)By investing in an RRSP

you can deduct the amount of your RRSP contribution from your taxable income, up to your annual RRSP deduction limit, thereby reducing the taxes you will have to pay. In addition, funds in an RRSP grow on a tax-deferred basis. The investment income and capital gains generated in the plan are not subject to tax until you make a withdrawal in the future.You may also want to consider contributing to a spousal RRSP for your low income spouse to equalize future retirement income. In doing this, the high income spouse utilizes their RRSP contribution room when making a contribution and is able to claim the deduction on their return. The RRSP/RRIF withdrawals will be

Must Know What Is The Benefit Using Accountant

Tips to Choose an Accountant for Your Small Business

Be Selective

You need an accounting professional on your team. Interview at least three candidates before you select your accountant. You need to choose an accountant that is a fit for your small business. If you hired an accountant that does not feel like they are on your team, move on. While you might feel some short-term discomfort while doing this, you will get long-term benefits for your business. You need up-to-date financial information to make the best business decisions. This starts with professional accounting services.

Ask About Reporting Frequency

It is important for you to know how often you will get financial statements from your accountant. Frequent communication is vital between you and your accountant, especially when you are growing your business. You want to use your accountant as a business advisor, not just to get help during tax season. So, set expectation about the frequency of reporting and communication in advance, and choose an accountant who meets your requirements.

Check If the Accountant Uses Cloud Technology

More and more accountants are switching to cloud computing. It is because of the number of benefits they can get, such as data security, remote data accessibility, flexibility to do work, and many other features like electronic invoicing, and ACH wire transfer. At all times, you want to have access to your accounting data. Plus, you want the accountant to be available to discuss urgent matters any time. This is possible when the accountant has opted for cloud services.

Ask About Accounting Software

Before you choose an accountant, you’ll want to ask what software they recommend for their small business customers. You may find some accountants who are using the same old desktop accounting software. They do not want to switch to the latest online accounting solutions. You want to invest in an accounting software system that you can grow into in 3-5 years. You also want an accountant who can teach you how to use your software and set up your initial chart of accounts. You should also inquire about whether they could help you get a discount on your accounting software.

Leverage Social Media

These days most accountants are active on different social media platforms. In fact, having a profile on LinkedIn should be a must for any working accountant or accounting firm. You want to see if they have a profile and if they have any recommendations from customers. That is social proof that they have an active business and are highly recommended for their expertise by at least a few customers.


Businessman working in the office

Choosing the Right Accountant for Your Business

Choosing the Right Accountant: Hiring a Firm Versus an Inside Accountant

Many entrepreneurs who launch their own businesses start out by wearing the accountant’s hat and doing your own taxes, in addition to doing just about everything else in the business, too. It’s become easier for a layperson to keep track of a business’ finance with the advent of simple bookkeeping software, such as QuickBooks, Quicken, and Microsoft Office Small Business Accounting. But there comes a time in a growing enterprise when it makes sense to hand over responsibilities for taxes, accounting, and the rest of the financial functions to specialists.

Choosing the Right Accountant: When Is It Time?

Many small businesses don’t have the volume of financial transactions that necessitate hiring a full-time — or even part-time — bookkeeper or accountant on staff. Then again, the financial situation of their business is such that they could benefit from more regular financial review and planning and up-to-date accounting — instead of leaving every invoice, receipt, and ledger to hand off to the tax preparer at the close of the fiscal year.

Inside accountant

When the business grows in revenue and the transactions become more complicated, it is time to consider hiring a full- or part-time inside accountant. Since the outside accountant’s fee grows with the size of the business, the owner may see some cost savings by bringing some of the work in-house.

Choosing the Right Accountant: The Key Qualifications

After determining whether you will hire an inside or outside accountant, you need to determine what qualifications your accountant should have before beginning your search. A non-certified accountant may be precisely what you need to handle your business’ financial statements, analysis, and bookkeeping.  However, when it comes to tax advice and return preparation, business owners usually look to accountants who are certified and licensed. Here are some of the qualifications you may look for:

Choosing the Right Accountant: Finding a Referral

For an outside accountant, find out who and/or which firms your friends and colleagues are using. Ask people in similar industries for names or referrals. Mention that you are looking for an accountant at the country club or health club. “Word of mouth is one of the best ways to identify good candidates for your business,” Chamberlain says. “Maybe your corporate attorney can make a recommendation. Your industry trade association also can be a good resource.”


tips for small businesses on selecting the right accountant

  • Make finding an accountant one of the very first things that you do when starting your business. Working with an accountant during the startup phase is the best way to ensure that your company is in compliance in terms of taxes. Your accountant can also help you manage any expenses related to getting your company up and running.
  • Choose someone who is qualified. These accounts in Hounslow recommend that you consider hiring an accountant who belongs to a group like ICAS, ICAEW, or ACCA. In order to become members of these organizations, accountants have to prove that they are qualified.
  • Look for an accountant who is familiar with your industry. An accountant who has experience working with other small businesses in fields similar to your own can usually do a better job of providing you with knowledgeable advice. For instance, if you are a freelancer, you should avoid hiring a general accountant. Instead, look for someone who specializes in situations like yours.
  • Evaluate the fees. When hiring an accountant, take a look at the specific fees that they charge and how those fees are calculated. Some companies charge a flat rate on a monthly or annual basis. Find out if there are any start-up fees or fees if you close your account. Discuss extra charges for services that aren’t included in the typical workload of the accountant.
  • Consider the services that the company offers. All accountants offer standard services like managing payroll, handling annual accounts for limited companies, and managing HMRC. Look at some of the specialized services that they offer, as well. For instance, will they help you with your self-assessment returns or do they offer IFA services?




how many members of staff work for him? Does he have enough numbers to service your needs? What is the level of experience and qualifications of the team members? Does the accountancy practice network with other accountants, tax advisors, niche tax practices or independent financial advisors?


If you are being charged on a time basis then make sure that there is no duplication of work. You do not want to pay for the same job done twice or even worse to be charged for errors made by your advisor (this is applicable to both solicitors and accountants). Always ask for a predictive cost of the service to be provided (I always do this with my solicitors) and also set a ceiling of fees on time charged services. It is important that this ceiling is agreed together with your professional advisor BEFORE any work is done as this will avoid unnecessary arguments in the future. If this ceiling is to be breached by your advisor then simply ask for a reason and also a breakdown of their time sheet so that you can analyse where and how time has been spent.


What are you getting for your money? Cheap fees will inevitably reflect on the service. If you only want compliance work then choose a basic cost effective accountant but if you want the best tax advice then never select on the basis of fees. Always look for the right balance, any advice that you pay for MUST always make or save you more money than the fees being charged, otherwise you are wasting your money.


Do they have any or do they simply work from home? If they do have offices how expensive are they to run and maintain. Having expensive, plush offices in Central London may look fancy on the letter head but it will obviously be reflected in the charges so beware.


Does he really know his stuff? Does he go to seminars to update his knowledge in the areas that you want to receive advice from? Is he passionate about increasing his knowledge in taxation? Does he network with other niche tax practices and Independent Financial Advisors to assess if there are any other products in the market that can genuinely support your business needs?


How to choose an accountant for your small business

Why should I hire you?

Hiring an accountant can be “even more important” than taking on a member of staff, says Clive Lewis, head of enterprise at The Institute of Chartered Accountants in England and Wales (ICAEW). “If you get the wrong person, you can miss out on things you should know,” he explains, “and that can be very costly.”

Could my money work harder?

James Richardson is a company director at Metric, an accountancy firm specialising in start-ups. He says most people believe an accountant will just be looking after annual accounts and tax compliance. However, “that’s only a small portion of what a good accountant can – and should – be doing for you.”

Are we a good match?

The right accountant will have more than just prestige – it’s important they understand small business needs, and are able to offer relevant insight.

Are things working out?

Once you’ve chosen an accountant, measuring their performance is an ongoing process. Chung says a great way to do this is to hold monthly meetings where you can ask for their view on the business and its finances. “If their view is close to yours, that’s a good sign,” she says. “But you do still want to see a degree of challenge and initiative – if you only hear what you expect, that’s not a good sign.”