Countingup, the bank that thinks it’s an accountant (or vice versa) opened its portals for business just before the Easter weekend.
Founder Tim Fouracre, pictured above addressing a gathering of customers, prospects, partners and press in West London on Wednesday 29 March, said that even when he qualified as an accountant with KPMG, he always thought the separation of the bank from accounting was wrong. The process of reconciliation so beloved by accountants was just a hassle for sole traders and small business owners.
“It’s going to become especially difficult with Making Tax Digital – it will be four times worse for you if you don’t have a compliant system.”
When it opens up its digital doors in earnest after the Easter holiday, Countingup will be focusing its offering on the vast pool of 4.3m one-person businesses and the wider population of small, limited companies. The digital service is built on top of banking infrastructure provided by PrePay Solutions, which supports a network of cash points in convenience stores and post offices around the country.
Countingup’s big selling point is based around cost and ease of use. Once a business is depositing more than £750 a month, there is a flat monthly fee of £2.95 to maintain the account. There are no transaction charges unless cash or foreign currency are involved. Each cash deposit or withdrawal will incur a £1 transaction fee from post offices, or 2.50% per payment via PayPoint. Foreign transactions are charged at 2.75% of their value.
There are a number of conditions around the service, such as a £60,000 deposit limit for sole traders and a £120,000 limit for limited companies. And outgoings are generally restricted by a £10,000 ceiling.
When one accountant asked how Countingup handled cheques, Fouracre replied, “We don’t do cheques. We are a digital challenger bank.”
Instead Countingup is designed to handle payments and receipts and tax submissions from its mobile app. The bank boasts it can set up a new business account within five minutes (including carrying out online know your client checks).
“In the time you’re sitting on hold with one of the big banks, you could set up your account,” said London accountant Charlie Carne, who had tried out the Countingup service.
Once a customer is set up and incurring expenses on their Countingup card, the incoming transactions are categorised by the bank to match the expense headings that HMRC includes on the self employed tax return (and online MTD reporting portal).
While Countingup might appear to be taking work away from accountants, it is relying on practitioners to recommend the service to their clients. If authorised by their clients, accountants can have access to their data and be able to recategorise transactions if necessary.
What’s in it for accountants?
Responding to a “what’s in it for me?” question from one practitioner, Fouracre said: “Clients will have an amazing experience. They won’t need to worry about bookkeeping and accounting. And there will be a discount for accountants.
“Low value work for accountants is going away. We’re taking away the compliance legwork so that you don’t have to worry about it either.”
A lot of work needs to be done to flesh out the offering and add new features to support accountants who use the product.
The limited company version of the app was released last week, but the development roadmap includes enhancements to support receipt scanning, issuing quotes and invoices, generating profit and loss and tax liability reports, and filing corporation tax.
Fouracre vowed that all the necessary work would be completed within the year, and that CountingUp would be ready to handle VAT returns under Making Tax Digital when the new system becomes mandatory in April 2019.
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John Stokdyk sadly passed away in June 2023. He had been with the site since 1999, rising from news editor to editor in chief, global editor and head of insight. As a roving editor, he investigated the profession's use of technology around the world. He devoted his spare time to technology history and an oddball collection of stringed...