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Not sure £500 ever really put anyone off starting a practice. Also try anywhere not anyhow in your quote.
i dont think the overheads are any smaller now than 15 years ago.
You need: Prof cert subs, PI insurance etc which dwarf any software costs.
If anything they are higher now as you cant get away with using HMRC software for things like CT, nor can you get away with paper filing.
The only cheap thing you can do now is get TaxFiler at £12 a month, vs coughing up £500 for an old fashioned licence
Do remember we are talking here about (hopfully) people who are earing £30-50k in practice or in industry learning how to be an accountant before they start up.
We are not talking about someone who has woken up one morning on the dole and decided to be an accountant without knowing the first thing about it, albeit "any answers" might suggest otherwise.
Agree with other posters, £500 is far to low to start a practice, even one working from home and it's important any start up realises that to.
I think it's good and important that the article has raised it's not just about the money point, in fact with more clients caring less about whether you are qualified or not, and with more choice out there for them, it's not an easy industry to make large sums of money in especially in the early years if you are starting out on your own.
It's Saturday and despite working full time, I am working on the weekend - again. Yes working from home may be easier and cheaper but it's hard to switch off from work to when it's based at home, this can create tensions with partners very easily, I regularly go back to work in the evenings to and some clients will be put off by being a home based accountant, especially if you are targeting bigger businesses and if you've got family living with you to, I have had to regularly ask my husband if he wouldn't mind taking the kids out so I can meet a new client or sign accounts off with one over a weekend and used to have evening appointments to which are no longer possible now kids are older and noisier! Needless to say an office is on my Christmas list!
#justmytwocents
Unfortunately the barriers to entry were already extremely low.
Judging by the appalling lack of knowledge displayed in some of the questions in the 'Any Answers' section they have gone even lower.
It worries me that some clients are paying good fees to so called 'accountants' who are then providing a shoddy and inept level of service.
I can only see this getting worse when MTD is publicised to the general working public, and small businesses/sole traders clamour for a cheap accountancy service to help them out.
@Richard - perhaps the increased number of entrants is less to do with an increase in the number of start up practices, but rather AWebs constant marketing on the subject of the Awards?
£500 does seem very low, and I agree with many of the comments. However, we should also welcome newer firms into the market. There is still an issue with the average age of partners and succession - all new practices are welcome to keep ideas and a reasonable supply of the right experience available for businesses to call on.
Surely barriers to entry are clients and income. Surely thought would need to be placed on how am I going to live in the next year rather than can I acquire software cheaply? If you don't have a significant cash pot in place prior to start-up or another guaranteed means of income, would start-up not be a very risky decision? This would be a more practical thinking approach in my opinion. Agree with Kent accountant as to the shocking questions and answer forum.