The new penalty regime makes me wonder whether or not the sole practioner will be able or want to carry on.
Unless you have a "niche market" you have to take on a wide range of clients to cover PI CPD Prof Subs etc.
Many of the smaller clients are unreliable in their record keeping and I have great difficulty in seeing how I can ensure that nothing is included in the accounts that should not be unless I carry out audit style checks and completely review every bank account the client, his mother wife and grnadmother have ever held.
How many other are considering which way to jump. ?
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I remember...
...20 years ago being told that sole practice was a race between retirement, death and obsolescence
Albert Camus
Courts will decide
The new penal;ty regime means only one thing - a series of test cases in the courts.
Whatever HMRC think they can charge, the law and, perhaps more importantly, european law, states that fines, penalties, etc "must be proportionate". We will see what the ourts consider reasonable, not what HMRC would like them to accept.
Jumper
I am certainly considering jumping ships. I started as a trainee in 1991, and since 1998 have seen the small accountancy profession just self distruct.
I have now been self employed as a sole trader now for 6 years and i make less money now than i did 10 years ago. How is that right.
I compete against poorly managed, ethical, in fact i would go as far as to say rouge accountants, who seem to be able to charge peanuts, then when i do take on a new client, i have ot pick up all the mess.
I also see that PII will go up in line with that of solicitors and then the end is nigh.
Just looking for the best opportunity in which to jump ship.
Move on....
Jumper - maybe it is because you havent changed with the times?
So many accountants are so set in their ways.
No I dont think its the end of the small practice at all - you just have to change and move on look at new ways to work. Its the same as any other industry adapt to the change.
The £10 gallon of petrol analogy
Had you thought if petrol was £10 per gallon the roads would be less crowded and the rest of us would be zooming about relatively unimpeded ?
The market in accountancy services might actually improve over the next few years.
Move on
As the jumper, i have seen how small accountants have "changed with the times", even qualified accountants. Which is one of the reasons our profession is in decline, in line with all other professions.
Jumper and his friends
You can fight the battle but you wont win the war - its time to change or leave, like it or not.
Not jumping but do feel like I'm drowing sometimes
I have been a sole practitioner for 15 years, with a part time book-keeper for the last 4. I feel like I charge a reasonable fee, not too low but considering I work from an office at home, not too high. But the admin side, finding time for CPD as well as paying for it, software costs, money laundering etc just seem to pull me down and the amount of letter opening for HMRC P11D/P35 etc requests when they have been filed online for years now!!! An admin assistant would be wonderful, but then what money would I get! Going paperless would be wonderful too, but when do you get the time to organise the start of it? Back to work...
Fuel analogy...
But when fuel reaches £10 a gallon there are those who circumvent by filling up on red diesel, or drive uninsured etc.etc..
What we await is for rogues to be taken out of the system, leaving those who are more efficient and above-board to prosper.
Jumper - why not sell up and move on.
Let me help you find a buyer for your practice. We have lots of buyers on our books and I am sure one will be right for you. Nicola Draper from Draper Hinks
I jumped
I jumped.
Made money but felt I was criminal each time I arrived at the office with the ever increasing laws applying all making me liable for what a client did or did not do.
Best decision I ever made
The more who jump the better - more clients for the rest of us.
Why do some people think that they cant survive? You simply adapt, change working practices, and if its costing you more to ru your business - increase your prices. Clients will either pay it or clear off - and did you really want cheapskates as clients anyway? They would have left anyway the minute "Fred down the pub" told them his accountant is cheaper.
ADAPT
I assume when you became an accountant there must have been some or many areas of accounting you enjoyed. So simply stick to what you like and are good at – build on that and just link up with a Chartered Tax Adviser to help with the ever changing tax laws.
In the current economic and political climate, rapid and radical changes in tax are expected. So adapt. Properly marketed, this could be a time of opportunity: New tax laws = New tax planning opportunities! – even for sole practitioners.
“It is not the strongest that survives nor the most intelligent but the one most responsive to change” – Charles Darwin.
Jumpers
It really makes me think what these people were doing in practice anyway.
You can imagine them at school playing footie or rugby, first tackle and its "I'm not playing any more". Little wonder we have politicians with no backbone.
I blame the PC and do-gooders brigade.
What impact do you think new penalty regime will have?
The worry expressed by OP is not one I've heard from small practitioners before. Well, not with a specific ref to the new penalties regime anyway!
My view is that the changes in the systems and rules presents opportunities and that it can help to focus on these rather than on theoretical problems. (Yes, I'm aware of the old glass half empty/full analogy!)
For example: The new penalty regime allows taxpayers, who can show they have taken 'reasonable care', to escape all penalties in the event that a problem arises in the future. It's important therefore for the adviser to tell clients what they (the clients) need to do to be able to evidence that they take 'reasonable care'. And that goes beyond appointing a competent adviser and attempting to abdicate all responsibility for keeping proper books etc. Why is this an oppty? Because it may justify the provision of related services such as bookeeping - either by your practice or a contractor - which then makes your life easier and allows you to focus on the provision of more valuable services and advice.
Mark Lee
TaxAdviceNetwork.co.uk - providing accountants with their choice of independent tax advisers from around the UK