Hi all,
After years of working for someone else I finally got the courage to go on my own.
I am currently doing some research into how much I should charge for my services. Any advise would be appreciated.
Majority of my working life was spent as being the finance department for other companies. Currenlty I am in charge of a multi-group company with a rather complicated structural/shares set up. I do all of the annual tax returns and run all of the financial functions for them with the help of a small team. So it keeps me on my toes and I am up to date on all legistaltion.
I am based in Kent (Tunbridge Wells) area, and I know people charge premium for majority of services in the area.
I will be looking at the small to medium sized Ltd companies and the self-employed (I think I would leave the more complcated larger to others at this time, as I like my life a little simpler). So I will be offering VAT returns, bookkeeping, tax returns, CIS, payroll, company secretarial but also providing services of finance department and management accounting. What other services do you offer to attract clients and which services?
Also what software do you use?
Thank you in advance for all your help. I appreciate it.
Replies (25)
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Search the site. These are questions that come up on a weekly basis.
Have you worked in a tax function as part of your in-house finance experience?
I was aiming my question at locally based people as the prices vary so much area by area and I don't want to outprice or undercut myself.
I have worked as senior accountant in a chartered practice (few years back now - hence not being up to date with charges) as well as financial controller now.
So have you worked in a tax function as part of your in-house finance experience?
Obviously tax law changes dramatically over the years and the practicalities of tax compliance are almost as complicated as the tax law that underpins them. I just wondered how you were going to approach VAT, payroll and (direct) tax returns without recent practical experience. When I read things on here, it makes me realise how difficult it is to be a competent sole practitioner.
Anyway, as I said, the question of fees is a regular question on here (one on the last week, from memory) so have a look. You can also work backwards from your desired net income and costs to see what your average charge out rate would need to be. Say 230 working days x 7 hours a week (conservative) = c1,600 potential billable hours.
Is there any constructive advice you would like to give me that is in line with my original post
Happy to repeat the advice I've given twice:
"Search the site. These are questions that come up on a weekly basis."
And bonus advice - don't start getting aggressive when you are asking for free advice and being asked a reasonable question. I've known many financial controllers in my time and none of them would have known the first thing about tax.
What you need to earn and what the market will bear will initially likely be miles adrift from one another, unless day one you have a significant client base.
What you charge will in part be based upon what your offer looks like, so are there offices, staff , high street day one or are you "Accountant with car, travels to clients, meets in hotels" ?
There is certainly unlikely to be a one price fits all, so what I would consider reasonable as an hourly recovery re say payroll I would not consider re tax compliance and if I was doing a tax planning exercise or bank fund raising I would in effect be charging even more per hour.
I am on here the wrong person to comment on fees, for one thing I billed on the meter , no fixed prices for me, and some of my charges were very light, but as a one man band I started with what I earned as a a salary per hour in my day job and tried to bill at minimum of 1.5 times that as self employed ranging to three times as much depending on the work. So take current salary, divide by 46 working weeks, divide by 35 or 40 hours , get an hourly rate, apply NIER and employer pension, then multiply by 1.5 and that is your bookkeeping rate, basic compliance say two times, planning etc three times.
I have set up accountancy systems from scratch and created an accountancy related software.
I've also set up accounting systems and done all sorts of sexy tax stuff but I wouldn't have a clue how to set up a PAYE scheme or complete a builder's VAT return. No-one is saying you aren't good at what you have done. We are just interested to know how you plan to upskill yourself to engage in a line of business very different from what you say you have done in the past.
Apologies I didn't include all of this as part of my question, but my question wasn't aimed at other accountants to assess my abilities but to find out what people charge.
To be fair, without assessing your abilities (or listing our own) nobody can advise you on what to charge and any indication of our fees is irrelevant.
I'm a little bit south of you and charge around £60 p/h for bookkeepers and at least £200 for a Tax Return. Does that mean you should charge that? Slightly less as a start up? Slightly more if you're in a particularly leafy bit of TW?
One of my former trainees moved into industry after 4-5 years. They weren't particularly good in a practice environment - not particularly efficient and struggled with deadlines. They have, however, done quite well in their current role. If they set up as s/e bookkeeper and charged £25 per hour, I'd probably be able to staff it better and compete on overall price even at charge rates around double that. They'd probably manage the easy SATR but sooner or later they'd make a real mess of one. Really they should be charging £100 max for a Tax Return, and declining anything vaguely complicated.
Another is still with us. They complete fairly complicated accounts and draft tax computations/returns for partner review. The make the odd mistake or have gaps in knowledge, but are easily charged out at £80 per hour for all services. If they went out on their own then they might look to charge £50-£60 per hour and a good £150 for a simple Tax Return and more for non-basic ones.
So those two former trainees, both of whom I am still in regular contact with for different reasons, have very different abilities and should charge completely different fees in my opinion. The one who went into industry is ACCA qualified but is very naïve in tax matters. The one who remained in practice is AAT qualified and had a decent tax knowledge built up from their continued experience in the field. I would suggest that the latter is much more valuable in practice and should charge quite a bit more if, hypothetically, they both decided to make the move you are making.
The non-boring accountant
On behalf of all of the boring, solid, knowledgeable accountants out there ...
Sorry, this is how the world perceives us :)
I suppose that could be your handle on UKBF. On here, we think that of acturists, employment lawyers and auditors [;)]
I don’t mean to be rude, but you seem very persistent in not answering the practical tax knowledge question.
95% of your clients will only care about what their tax bill is - don’t blindly think that you’ll get loads of ‘good’ ‘interesting’ clients quickly. Unless you can afford to be super super picky in which clients you take on.
'Non-boring' eh?
I might offer my legal services as the 'non-fleecing' lawyer..
See how that goes.
Akin to Steve "Interesting" Davis, if you are old enough to remember Spitting Image.
I always fancied a firm called:
Disaster Area's Accountants
Maximegalon House
..............
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What services are you offering are you a specialist or a generalist?
Have you done any research?
I would start with Googling accountants near me and have a look at their websites as many will quote a stock from price for varying services which would be a good start for you. But you need to do some work/research you cannot expect you potential rivals to open up with everything you need to compete against them.