Do we need a Practicing Certificate?

Didn't find your answer?

We have recently started a new business offering admin services including bookkeeping and accountancy. We are not chartered accountants and therefore are not offering audit services. Our staff are QBE, we have registered with HMRC for AML supervision, our PII will be in place shortly and will be applying for agent’s code to submit our clients tax returns as well as there PAYE/NIC and VAT returns.

So our question is - Do we need a Practicing Certificate?

Replies (32)

Please login or register to join the discussion.

avatar
By David Ex
28th Jun 2023 00:46

If you’re not a member of a professional body, there’s no-one to provide you with a Practising Certificate even if you wanted one.

Thanks (6)
Replying to David Ex:
avatar
By AngelaF983
28th Jun 2023 01:01

Thank you, essentially I'm asking if there is anything stopping us from practicing without the certificate?

Thanks (0)
Replying to AngelaF983:
avatar
By Wanderer
28th Jun 2023 01:21

Leaving aside QBE what professional bodies are you a member of.

Thanks (0)
avatar
By Hugo Fair
28th Jun 2023 02:04

Not much of relevance has changed since https://www.accountingweb.co.uk/any-answers/do-i-need-a-practicing-certi...

... but plenty of downsides and exposure (not least to a potential lack of continuing development and/or help in the face of fast-changing legislation & technology).

Thanks (2)
avatar
By AngelaF983
28th Jun 2023 08:27

I am not yet a member of any professional body; I am though doing my AAT Level 4 Accountancy but do not want to wait to work until I have finished the course.
With regards to changing technologies we are using accredited software and are up to date with the continuous courses being offered.

Thanks (0)
Replying to AngelaF983:
avatar
By Wanderer
28th Jun 2023 08:59

https://www.aat.org.uk/membership/licensed-membership-be-your-own-boss
"If you want to run your practice as a student or affiliate member, you won’t be able to apply for a licence and there’s separate guidance you must follow."

AAT rules have always been a bit opaque to me. Probably best to check with them whether their 'licence' (whatever that is) is compulsory for you to practice. If it is you probably need to give up your AAT student status.

Thanks (1)
avatar
By SXGuy
28th Jun 2023 09:16

No.

Thanks (1)
the sea otter
By memyself-eye
28th Jun 2023 14:24

..and it's a NO from me.

Thanks (1)
avatar
By Postingcomments
28th Jun 2023 17:48

"Our staff are QBE"

So, they are not qualified. "QBE" is a euphemism.

Thanks (1)
Replying to Postingcomments:
avatar
By The Dullard
29th Jun 2023 17:34

QBE is not a euphemism. Beef bayonet and donut punching are euphemisms. You're confusing your euphemisms with your misnomers.

Thanks (4)
Melchett
By thestudyman
29th Jun 2023 08:22

AAT can provide information on exactly what constitutes being in practice.

Be careful - for ACCA I know, submitting and calculating client tax returns (self assessment etc…) constitutes accounting services and not bookkeeping services, and would require a practice certificate.

Thanks (1)
Melchett
By thestudyman
29th Jun 2023 08:25

Duplicate

Thanks (0)
By ireallyshouldknowthisbut
29th Jun 2023 09:26

The question I would ask, is whilst you can probably legally offer tax services with not a soul in your organisation ever having passed a relevant exam, "SHOULD YOU?"

Accountancy services are not a "tack on" to an all round "we do your admin and bookkeeping" set up. . If they are, they are doing to be rubbish, and you are going to end up having a very stressed team working way out of their depth, and failing your clients.

The smarter move might be to do all the admin and bookkeeping, and then work with some actual proper tax people who do this stuff for a day job and don't see the tax returns as "cut and paste from the TB and done" but an actual proper and flippin hard job.

I should point out I appreciate I don't know you, and you may have some absolutely brilliantly talented tax people in your team who have never done an exam. There are a considerable number of excellent non-qualified accounts out there, as well as shocking qualifieds, but there are also a huge number of "dabble with the tax, how hard can it be" bookkeepers who think they can do tax (and cant).

Thanks (4)
Replying to ireallyshouldknowthisbut:
avatar
By AngelaF983
29th Jun 2023 09:52

Your candour is refreshing and I agree 100%. We are fortunate though that we have hugely talented people on our team who have many successful years’ experience; who, while not having a degree, are continuously attending webinars and doing self-study to ensure that their knowledge and training is up to date.

Thanks (0)
Replying to AngelaF983:
avatar
By Wanderer
29th Jun 2023 10:11

Can't think any degree, not even an Accounting and Finance one, would help in the services you are offering.
It really is experience which trumps everything else.

Thanks (2)
Replying to ireallyshouldknowthisbut:
avatar
By Ammie
04th Jul 2023 09:59

Spot on. Agreed.

I am seeing slap dash, "that'll do" bookkeeping, tax and general accounting work and it appears to be getting worse.

I have seen it from non qualifieds and from substantial reputable qualified firms. Standards, certainly for the micro and smaller business, are often poor, probably because the work is delegated to the inexperienced and not reviewed, to accommodate budgets and profitability.

Fuelled partly by the literal interpretation of self assessment and software providers, including HMRC, promoting the ease with which compliance can work with the minimum of effort.

You only need look at the administrative mess HMRC are in to see that the issues are likely to extend to other organisations too.

Thanks (0)
avatar
By Yeadonian
29th Jun 2023 10:00

The AAT says the following if you are a student but running your own practice:

If you are currently doing Level 2 or 3:

"You won’t be eligible to apply for a licence until you become an AAT professional member. If you offer bookkeeping or accountancy services to the public, you must not make any reference to AAT in relation to your work and you must follow all relevant regulations. This includes registering with an appropriate money laundering supervisory authority. If you’ve completed the AAT Advanced Diploma in Accounting, you are strongly encouraged to apply for AAT professional membership and a licence."

If you are currently doing Level 4:

"As you've completed the Advanced level of the AAT Accounting Qualification, we can support you to offer self-employed services. Please apply for AATQB membership and your AAT Licensed Bookkeeper status now so we can help you run your business.

Should you decide to continue offering services without our support, you must follow our guidance for students and affiliates in practice. This includes being registered for anti-money laundering supervision, which is a legal obligation and failure to apply could result in serious enforcement action."

Source: https://aat.typeform.com/to/VKRZaO?typeform-source=www.aat.org.uk

Thanks (1)
Replying to Yeadonian:
avatar
By Wanderer
29th Jun 2023 10:16

So, no is the answer to the OP's question. Just don't mention AAT anywhere.

OP once you have passed your exams if you want to mention AAT this appears to give a summary of what you can do:-
https://www.aat.org.uk/membership/licensed-membership-be-your-own-boss/l...

You appear to be offering tax services as well. Do your experienced people have sufficient experience in practical tax work? That's an area where costly mistakes can easily be made.

Thanks (1)
Replying to Wanderer:
paddle steamer
By DJKL
29th Jun 2023 10:35

Wanderer wrote:

Do your experienced people have sufficient experience in practical tax work? That's an area where costly mistakes can easily be made.

And you often do not even know you are making the mistakes, tax is certainly the area where knowing what you do not know is crucial.

Thanks (1)
Replying to DJKL:
avatar
By AngelaF983
29th Jun 2023 10:47

Thank you for your insight. They do and I am busy with my tax modules and exams at the moment.

Thanks (0)
avatar
By Wanderer
29th Jun 2023 10:55

I think this whole thread demonstrates what I meant when I posted "AAT rules have always been a bit opaque to me."

AAT promote their 'licence' as if it has some statutory and / or official status, when clearly it has none.

Other than being able to promote yourself as AAT, probably the only other practical consequence is that you can have AAT as your MLR supervisor rather than HMRC.

Thanks (1)
Replying to Wanderer:
paddle steamer
By DJKL
29th Jun 2023 11:29

Can they not sign off re client mortgage applications?

Thanks (0)
Replying to DJKL:
avatar
By Wanderer
29th Jun 2023 11:38

Yes, you are right, that could also be one per the table here:-
https://www.onlinemortgageadvisor.co.uk/self-employed-mortgages/accounta...
but it probably depends on the individual lender's requirements.

Thanks (1)
Replying to Wanderer:
Avatar
By I'msorryIhaven'taclue
29th Jun 2023 11:55

Do either the AAT or HMRC require a DBS check, I wonder? Or PII?

Nothing to do with the OP, but I recently turned away a builder who was dealing with a very sharp "QBE" accountant from Eastern Europe, who is supervised by HMRC. The builder brought along his paperwork to our initial meeting: he had £20k of corporation tax debt; £12k of income tax debt; and an unexpected bill for a few thousand pounds from his accountant, for additional work that the accountant had omitted from invoices over six months. The builder wanted to know why his accountant's details were entered as recipients of any tax repayments on his and his company's tax returns, even though there had been no tax repayments for the entire four years he had been with that accountant. The accountant's Companies House balance sheets displayed a large BBL.

Thanks (1)
Replying to I'msorryIhaven'taclue:
avatar
By AngelaF983
29th Jun 2023 16:15

As far as I am aware no DBS check.

It is horrific that some bookkeeping / accountancy firms can muddy the waters for other little businesses.

My original question was to ensure that we are not stepping over any legal lines. The supervisory bodies - AAT, ACCA, ICAS - all say you are required to have their particular practice certificates!!! yet no where can i find any legislation to this effect. I do know that we need AML supervision - we have registered with HMRC for this.

Thank you all for your input.

Thanks (0)
Replying to AngelaF983:
Avatar
By I'msorryIhaven'taclue
30th Jun 2023 09:51

Any lack of a DBS check is something of a hole in the fence (I don't mean for you personally, but if someone with a dodgy background can slip the DBS net by registering with HMRC then IMHO that's a big oversight).

Thinking of dodgy people made me think of a carer client - all tax registered and above board with a contract for services for her clients - who earlier this week told me about the three other carers at one of her clients who, when social services turned up to assess the elderly patient's funding application, all disappeared. Turns out none of them are registered with HMRC; one of them was earning around £4k month just from that one patient. If anyone from HMRC's SWAT team happens to read this, I'll say three things: carers; teachers; builders.

I digress. Good luck with it, and try Hiscox for PII if you haven't fixed yourself up already. They're affordable, and easy to deal with.

Thanks (1)
Replying to I'msorryIhaven'taclue:
avatar
By Latinaid
04th Jul 2023 13:12

I'msorryIhaven'taclue wrote:
If anyone from HMRC's SWAT team happens to read this, I'll say three things: carers; teachers; builders..

Teachers? what are they up to then?

Thanks (0)
Replying to I'msorryIhaven'taclue:
avatar
By susieq
04th Jul 2023 09:27

AAT do require a DBS check in order to have a licence.

Thanks (0)
Replying to Wanderer:
avatar
By Mr_awol
04th Jul 2023 09:51

Wanderer wrote:

I think this whole thread demonstrates what I meant when I posted "AAT rules have always been a bit opaque to me."

AAT promote their 'licence' as if it has some statutory and / or official status, when clearly it has none.

Other than being able to promote yourself as AAT, probably the only other practical consequence is that you can have AAT as your MLR supervisor rather than HMRC.

To be fair, there is no real difference between the 'official standing or status' of the various bodies' certificates/licences - except for those that also include audit status of course. a 'basic' ICAEW PC is no more official than an ACCA/AAT version.

If anything, i think the ACCA are the ones with the opaque rules - they require a practising certificate unless you are 'only' providing accountancy services to TB(?) level in which case students and members can get around it by pretending t0 stop at that point and having the client 'self-submit'. That should really be stopped.

Thanks (0)
avatar
By Abacus Agent
29th Jun 2023 18:39

I have 30 years of experience in accounting. I do not have AAT or ACCA qualification in the UK. I have Auditor Qualification that I have made in one of the European countries. I have worked as an Accountant / Chief Accountant in my whole life.
Many of my friends, who hold ACCA or AAT qualification, ask me for lots of tax advice. They have qualifications but they do not have practice/experience.
I work in my own practice, started 7 years ago. If I have to have a Practice Certificate, I have to close my business in the UK and move to another county and give up everything that I worked for in the last 7 years.
AAT never accepted my Auditor qualification. They said they do not recognise that in their system. That is similar to ACCA.
I am 52 years old. What can I do?
What is the goal with this regulation? Collect more money?

Thanks (1)
Replying to Abacus Agent:
avatar
By Hugo Fair
29th Jun 2023 19:28

If you're really interested, have a read of https://www.gov.uk/government/publications/professions-regulated-by-law-...

There are many professions in the UK that are regulated by law (general accounting not being one of them) and a few that are 'reserved professions'.

Without getting drawn into the question of 'for whose benefit' the various PBs for accounting operate ... suffice it to say that they are membership organisations, and that their control is primarily derived from being able to refuse you permission to practice *under their banner* (but not to stop you trading).

Thanks (2)
Replying to Abacus Agent:
avatar
By Wanderer
29th Jun 2023 20:29

Abacus Agent wrote:

What is the goal with this regulation?

Don't worry. There is no such regulation, as long you register for AML with HMRC.
Thanks (2)