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Starting a practise

Setting up a practise

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Hello,

I am considering setting up in practise in the future to allow me to work more flexibly. I would love to hear any guidance or lessons learnt from those of you who have done the same.

I am interested in the following topics:

The logistics of setting up, e.g insurances, money laundering, data protection etc.

Marketing 

Useful resources, e.g things to become a member of, sites to look at etc.

Biggest challenges/ biggest highlights

Besr software etc

Any responses much appreciated 

Thank you! 

Replies (27)

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By Matrix
20th Aug 2019 06:51

I found this site very helpful when I started out. Do a search on the setting up/software/marketing.

Biggest challenges are getting clients and making sure you have the knowledge to offer the services you wish to offer (there are the known unknowns but what about the unknown unknowns?).

Biggest highlights are working for yourself and the flexibility, although even though I love not having a boss, sometimes it feels I have over 100 bosses.

Good luck, you will need it, it is very hard work and you will probably need a year’s funding behind you.

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Replying to Matrix:
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By AbbieG
20th Aug 2019 09:44

Thanks regarding the software, I will do that.

I have been reviewing my skill set recently and I have identified some areas I want to do additional training in so that I can ensure I am giving the right advise.

Yes from what I have read it does seem like a lot of hard work is required!

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By paul.benny
20th Aug 2019 09:08

Are you professionally qualified? You should check out your professional body's requirements to obtain a practising certificate and the continuing obligations thereafter.

What's your background? Does it equip you for the small and very small businesses that will form most or all of your client base.

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Replying to paul.benny:
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By AbbieG
20th Aug 2019 09:49

Yes I am ACA qualified, with 9 years experience. I have reviewed the ICAEW guidance and understand the practising certificate requirements.

I previously worked for a firm in London which only dealt with large and listed, but my current role is at a local practise dealing with small companies.

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By Maslins
20th Aug 2019 09:49

Each thing you mention is a massive separate topic.

The red tape is an annoyance, and something that does take some time/cost with negligible obvious benefit, but that's life.

Marketing/winning clients at reasonable fees will likely be your toughest hurdle at the outset. It's easy once you're well underway and have a decent bank of clients recommending you to their friends/colleagues, but starting from nothing is very tricky.

I'm a little over 10 years in, very happy I made the move. However, there have been some big lows. Notably:
- early days, it being far harder to get clients than I anticipated.
- 1-2 years in, a couple of clients walking all over me, and me not really having the confidence to deal with it well.
- 3-4 years in, the feeling of being totally tied. If a job really gets you down, you can quit. You can sort of do that with your own business, but you're typically letting a lot of clients down badly, so it doesn't feel a viable option.
- following that, I've gradually built a team that do the lion's share of the work. This brings its own issues (staff management), but overall I'm far happier, and it can become lucrative.

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Replying to Maslins:
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By AbbieG
20th Aug 2019 13:10

Thanks for the response, I appreciate it was a broad question, I am very much in an exploration stage. I am just interest to hear other accountants views, I will of course dig much deeper into research before I make a move.

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Hallerud at Easter
By DJKL
20th Aug 2019 10:18

Do consider ICPA membership along the way. Whilst you will be a member of ICAEW, and will no doubt be paying their subs etc, plus they will no doubt supervise your ML registration, ICPA membership comes with a number of included items- PI insurance, Bloomsbury access, AMLCC software access, some inclusive online CPD so for the cost, if you anyway want all these things, it is decent value for money.

Re software I run with TaxCalc Tax and Accounts plus Brightpay re payroll, albeit I am sure there are cheaper and the client database re practice management in Taxcalc is not its strongest point.

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Replying to DJKL:
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By AbbieG
20th Aug 2019 13:13

That's very interesting thank you, I will take a look.

We use tax calc at the firm I am at now, so would be good to have some consistency in terms of software!

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By 2003bluecat
20th Aug 2019 11:36

Stay away from Sage software would be my main advice.

Accountancy Manager could be useful but would be an extra cost for a function which you could probably manage just as well with with spreadsheets (particularly at the start). However, once you start expanding it then takes time to get practice management solutions in place, so starting out with it could save you time and money in the long run.

TaxCalc is excellent, however there are cheaper options out there (Tax Filer for one).

I try to stay away from payroll but have heard good things about Brightpay and Moneysoft.

Get everything you can on the cloud/web based. This will lower you computer costs and whilst it may seem like an unnecessary reoccurring expense, it makes life so much easier to have access to all your data from any computer with an internet connection.

Try to avoid quoting too low, the client will expect great service for that low price for a long time and you may start resenting them in the long run. It's fine to offer a discount for x months/years but ensure the client is aware that this will change in the future.

Good luck, there's a lot of red tape and it's very hard work but as others have said it can be very rewarding.

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Replying to 2003bluecat:
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By AbbieG
20th Aug 2019 13:16

Thank you, so much useful advise.

Interesting about Sage, not the first person I have heard say this. Which cloud software do you love?

Yes I use tax calc at the moment with my current firm, I had looked at Tax filer as it was so much cheaper, do you have a view on tax filers capabilities?

100% wan't to use cloud, its certainly the way forward.

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By MissAccounting
20th Aug 2019 12:47

Ive only skim read the other answers but dissapointingly it seems no one has asked what you are practising for?

With regards to most of the questions you ask I would suggest, with respect, that if you need to ask all of those you arent in a position to run a practice. Get a job in a small accountantancy firm and gain the experience needed.

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Replying to MissAccounting:
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By Wanderer
20th Aug 2019 12:50

MissAccounting wrote:

With regards to most of the questions you ask I would suggest, with respect, that if you need to ask all of those you arent in a position to run a practice. Get a job in a small accountantancy firm and gain the experience needed.

The OP has done that:-
AbbieG wrote:

Yes I am ACA qualified, with 9 years experience. I have reviewed the ICAEW guidance and understand the practising certificate requirements.

I previously worked for a firm in London which only dealt with large and listed, but my current role is at a local practise dealing with small companies.

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Replying to Wanderer:
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By MissAccounting
20th Aug 2019 12:54

Wanderer wrote:

MissAccounting wrote:

With regards to most of the questions you ask I would suggest, with respect, that if you need to ask all of those you arent in a position to run a practice. Get a job in a small accountantancy firm and gain the experience needed.

The OP has done that:-AbbieG wrote:

Yes I am ACA qualified, with 9 years experience. I have reviewed the ICAEW guidance and understand the practising certificate requirements.

I previously worked for a firm in London which only dealt with large and listed, but my current role is at a local practise dealing with small companies.

Great, should only take a few years to get up to speed then.

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Replying to MissAccounting:
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By AbbieG
20th Aug 2019 13:25

Thank you for your response. I appreciate I am not in a position to do so at the moment, hence why I have not. I am very much just exploring options for the future and I am working in a small firm at the moment obtaining the relevant experience and guidance from the partners. I just see no harm in doing research and seeking guidance from those who have made the move.

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Replying to Wanderer:
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By adam.arca
20th Aug 2019 13:01

I took MissAccounting's response to be a dig at the fact that a very important word in this context has been consistently mis-spelt by the OP.

That would also be my advice to the OP: nothing annoys a certain sort of client more (and me, and also MissAccounting if I'm guessing correctly) than slapdash editing and spelling skills. Apart from that, good luck with your new venture!

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Replying to adam.arca:
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By AbbieG
20th Aug 2019 13:31

Sorry, I am dyslexic and sometimes this causes me to make grammatical errors and spelling mistakes. If that is something a client finds annoying then I guess they won't work with me, and that is fine, there isn't to much I can do about it. Thanks for the luck, sounds like I will need it!

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Replying to adam.arca:
Psycho
By Wilson Philips
20th Aug 2019 13:36

It annoys me too - and not just that word. There is another Americanised word in there.

Although it doesn’t grate nearly as much as the increasing (mis)pronunciation of “skedule”

(But then why do we say “skool” and not “shool”? English is weird.)

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Replying to Wilson Philips:
By Duggimon
20th Aug 2019 14:52

Wilson Philips wrote:

Although it doesn’t grate nearly as much as the increasing (mis)pronunciation of “skedule”

(But then why do we say “skool” and not “shool”? English is weird.)

I don't know if it's the case with your particular examples but it's generally because English isn't as rigidly defined as a lot of other languages and has a vast number of loan words as well as a number of different sources.

Words coming from Germanic or Nordic languages have different pronunciations of the same letters as those from Romance languages, or Greek or wherever else we've snatched words from. It's a horrendous mess that we tend not to notice due to having always spoken it.

The biggest changes to British English in the years to come will be the Americanisation of it, you're fighting a losing battle I'm afraid, all the children I know constantly use Americanisations like garbage, sidewalk, mail etc. due (presumably) to the ubiquity of American English on the internet.

Thankfully it's not all doom and gloom, American English is still just our English, just grown up somewhere else for the relatively short period of three hundred years or so.

I read an interesting article somewhere recently about how the American accent of now is closer than the British accent of now is to the British accent of the sixteenth century, the two countries are perhaps somewhat less divergent in terms of language than we tend to think.

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Replying to Duggimon:
Psycho
By Wilson Philips
20th Aug 2019 16:58

Does anyone have any recordings from the 16th century (other than episodes of Blackadder II) ???

I'd be interested to know just how someone has established what the accent was like back then.

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Replying to Wilson Philips:
By Duggimon
20th Aug 2019 17:09

Well it's a broad simplification of course because there's no such thing as an "American" accent or a "British" accent, but it goes without saying that at one point they were the same thing and so there's at least a 50/50 chance that the Americans preserved more of the old accent than we did.

I believe it's largely to do with the pronunciation of "R" in words, and the Americans follow ho wit was pronounced back then, while we've moved away from it?

I have no idea how they know, but people write phds on it so I'll defer to them, I thought it was an interesting idea though.

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Replying to Duggimon:
Psycho
By Wilson Philips
20th Aug 2019 19:11

People write PhD theses, supported by grants, on all kinds of nonsense.

And which American accent are we talking about? The accents across the various States are as diverse as those in the UK.

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By TessaW
20th Aug 2019 13:38

For me, marketing & deciding where to have my office were the main challenges. Before deciding on an office I tried an ad in a local paper & got no response at all, which was dispiriting. Word of mouth around my friends lead to a number of them asking if I would do their tax returns when I set up on my own. However I didn't make a move until a friend of a friend asked if I could be a sort of management accountant for his firm which we worked out would require an average of 1 day a week. I decided to start with a home office and aim for 3 days of client work, 1 day training & 1 day admin. Working from home meant I didn't want complete strangers so did no public advertising for a while and then put an ad in a local village magazine - mainly to support the magazine. Other challenges are that having many clients who are friends & friends of friends means they have no concerns about calling about work despite knowing I am on holiday or at weekends. Its also tricky when they expect tax returns done at the last minute. You need a very supportive partner &/or family.

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By Yorkshireblue
23rd Aug 2019 10:24

Be prepared to be "hands on" and I mean everything from straightening folded petrol receipts to putting invoices into alphabetical order because you will be the one keying them in.
You will soon notice the difference between a carrier bag full of receipts and invoices to those presented in a lever arch/box file.
My biggest shock was dealing with small/sole traders who turnover just £20-30k annually yet survive when you may have been used to much larger numbers in the past.
My best advice would be to cultivate your clients and network from them - they will be your cheapest form of advertising.
Brightpay is pretty good and VT Transaction+ will save you on software costs.
Good luck - it will take you a couple of years to get back to your last salary level, but it can be a pleasant journey.

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Replying to Yorkshireblue:
By Charlie Carne
23rd Aug 2019 11:41

Yorkshireblue wrote:

putting invoices into alphabetical order because you will be the one keying them in.


Not if the OP uses modern cloud software like AutoEntry or Receipt Bank.

One advantage that AbbieG has is starting from scratch in a fully cloud-enabled world, which will bring huge efficiencies from the start. I would definitely use fully featured practice (NB spelled with a "c" not an "s") management software from the start (I'd recommend Senta or Accountancy Manager or possibly Karbon). For bookkeeping look at QBO and Xero and I'd recommend choosing just one of them in which to become expert, so that using it becomes second-nature. If you like TaxCalc, it's great for a small practice, but it is not fully in the cloud (as you have to install a local copy), so you may wish to look at Taxfiler if you want a true cloud solution for tax and accounts prep. Don't worry about the cost, as these solutions are very cheap and just one additional small client will pay for all of them each month; whilst using proper tools from day one will make you so much more efficient that you have the time to take on many more clients.

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By nickr
23rd Aug 2019 10:32

Hi, if you have problems getting clients try networking events, also there are online "leads" request for people requiring tax returns, bookkeeping and accounts. You should most importantly know what market you want to specialise in. As your practice grows "word of month" will also happen. I paid initially through "leads online" and from there I grew.

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By JDBENJAMIN
23rd Aug 2019 11:31

For software I recommend Brightpay, Taxfiler, and VT. You'll not regret any of those choices. Sage and Xero are to be avoided at all costs, whatever you might hear elsewhere. I have never used practice management software, as it is not necessary for a sole practitioner. Don't believe pedlars of bovine ordures who tell you how they made £100,000 in the first year. If you really put the work in, and focus your marketing well, you may succeed in growing your turnover at a rate of £10,000 per year, but be prepared for less.

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By mail.taxperfect.co.uk
27th Aug 2019 12:30

All of the above, but also don't do it at all if you don't like continuing red tape after red tape after red tape. The absolute bane of a sole practitioner's life...

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