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Search for an accountant in London and you'll find thousands of results. Most of those firms will get your accounts filed on time. The real differences show up in everything around the filing: how quickly they reply, whether they warn you about a tax bill before it lands, and whether you understand your own numbers any better after a year with them.
These are the questions worth asking before you sign up.
First, be clear about what you need
Some businesses only want their year-end accounts and tax returns done. Others want ongoing support: bookkeeping, payroll, VAT, management accounts and someone to call when a decision comes up. Know which you're looking for, because firms are often set up very differently for each.
12 questions to ask a prospective accountant
1. Are you qualified and regulated?
Ask which professional body the firm belongs to, and confirm it is supervised for anti-money laundering, which every UK accountancy practice must be. Ask too whether it holds professional indemnity insurance.
2. Do you work with businesses like mine?
Experience with your sector and size matters. A firm used to London hospitality, construction or professional services will spot issues faster and know which questions to ask.
3. Who will actually do my work?
The person who pitches to you isn't always the person you'll deal with. Ask who your day-to-day contact will be and how senior they are.
4. How do you communicate, and how quickly do you reply?
Email, phone, WhatsApp, meetings: find out what's normal and what response time to expect. Slow replies are one of the most common reasons people change accountant.
5. Which accounting software do you use?
Cloud software such as Xero lets you and your accountant see the same up-to-date figures. Ask whether they will set it up and train you, and confirm the account will be in your business's name.
6. What exactly does the fee include?
Ask for a written list. Common extras include payroll, VAT returns, director self assessment returns, Companies House changes, bookkeeping catch-up and responding to HMRC letters.
7. Fixed monthly fee or hourly?
A fixed monthly fee makes costs predictable and means you won't hesitate to pick up the phone. Ask what happens if your needs change during the year.
8. How do you keep track of my deadlines?
You want a firm that tells you what's coming and what they need from you, well before it's due, rather than a last-minute request for paperwork. Our guide to limited company deadlines shows how many there are in a year.
9. Will you help me plan for tax, or just report it?
Reporting what happened is the minimum. Good accountants look ahead: estimating your corporation tax and personal tax during the year, so you can set money aside and make decisions in time to act on them.
10. Can you give me figures during the year?
Monthly or quarterly management accounts show how the business is really doing. Year-end accounts arrive months after the year has finished, which is too late to change anything.
11. How do you handle the switch from my current accountant?
A professional firm will deal with the handover for you, contacting your previous accountant for the information it needs. Ask how long it usually takes and what you'll need to do.
12. Will you give me an engagement letter?
This sets out the work, the fees and each side's responsibilities in writing. If a firm won't provide one, look elsewhere.
Signs it may be time to change accountant
- you only hear from them when they need paperwork
- tax bills arrive as a surprise
- you've had penalties for late filing
- replies take days, or you never speak to the same person twice
- you still don't understand your own numbers
Does it matter if they're local?
Much of the work is done online now, so an accountant doesn't have to be round the corner. But there's real value in a firm that knows London business, from the cost of premises to the realities of hiring here, and that you can meet face to face when it counts.
Talk to Liberty Financial
We're a firm of chartered accountants based in Southwark, near London Bridge, supporting owner-managed businesses across London with bookkeeping, payroll, VAT, year-end accounts and tax planning. Every client has a dedicated account manager. If you're thinking about a change, get in touch and ask us any of the questions above.
Frequently asked questions
Does my accountant need to be based in London?
Not necessarily, as most of the work is done online in cloud software. But a London accountant will know the local business landscape, and it's useful to be able to meet in person when there's a big decision, an HMRC enquiry or a sale on the table.
Can I change accountant part way through the year?
Yes. You can switch at any time. Your new accountant will contact the old one for a professional handover, often called professional clearance, so records and deadlines carry across without gaps.
What's the difference between an accountant and a bookkeeper?
A bookkeeper keeps the day-to-day records: invoices, bank reconciliations, payroll and VAT. An accountant prepares your year-end accounts and tax returns and advises you on tax and structure. Some firms, including ours, do both.
What is an engagement letter?
It's the written agreement between you and your accountant setting out what they will do, what you will provide, the fees and the responsibilities on both sides. A professional firm should always give you one before work starts.
Want this handled for you?
Our Southwark team keeps London businesses' books, tax and deadlines on track, with a dedicated account manager.
Written by
Peter Leshinsky
Founder, Liberty Financial, a firm of chartered accountants in Southwark supporting owner-managed businesses across London.
