I'm Self Employed: Do I Need an Accountant?

I'm Self Employed: Do I Need an Accountant?

Jamie Trowell
Jamie Trowell
Accounting Lead at Coconut
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It’s a question we get asked a lot. 

And there’s no doubt about it, accountants have a really valuable role to play. They provide something technology isn’t able to replicate: peace of mind. 

Having a human to talk to, someone who understands how you’re feeling and has experience that’s built over many years can give you the confidence to make big decisions for your business.

But let’s break it down and look at each of the areas an accountant can help you with and whether it makes sense for you to work with one.

They can save you time

The UK tax system can be complex. It is said that the UK has the longest tax code (a mere 17,000 pages long!). 

Chances are you started your own business because you’re particularly passionate about something, or particularly skilled in a specific area. Not because you wanted to learn the UK tax system. But running your own business often requires you to become the ‘finance person’ on top of everything else. 

Having an accountant means you can hand over the burden of admin and legal obligations of your business, allowing you to focus on doing what you do best, and spending your time on growing your business and making money.

They could also save you money

Besides saving time getting to know the UK tax system, hiring an accountant to manage your finances and deal with your taxes could mean you actually save money by making sure you pay the right amount of tax. Because they know the intricacies of the system inside out they can make sure you’re not missing out on key tax savings. They’ll also make sure you avoid any nasty fines by missing key deadlines!

Business planning

The role an accountant plays is evolving. They are not just there to provide the financial reports. Take Covid-19 for example, accountants have been the main support channel for all types of businesses when it comes to understanding what support they can obtain from the Government and how they should adapt their businesses to survive. 

An accountant will also advise you on what entity you should set up as: Sole Trader, Partnership or Limited company. These routes all have their advantages but an accountant will be able to tailor their advice to you, giving you the best option.

Confidence that you’re doing things right

Do you feel comfortable handling your finances? Can you understand your accounts and bookkeeping? If you feel uncomfortable with any of these questions then you should consider hiring an accountant. 

Finding a friendly and proactive accountant can be crucial in giving you confidence in your financial affairs. A great accountant will be able to help when it comes to keeping your business on the right side of the law. They’ll also be able to explain each aspect of your accounts and obligations to give you the understanding you require so you can see how your business is performing financially.

They can act on your behalf

Have you ever had the pleasure of dealing with HMRC? It can be tricky sometimes. Accountants are able to act as your agents and deal with HMRC on your behalf. This is a big step in relieving the stress, and most importantly time, that you could be spending growing your business.

Accountants are the go-to business adviser

This is exactly why we built the Coconut Accountant Portal last year; to allow our customers to work better with their accountants. And to remove much of the laborious bookkeeping admin for the accountant so they can focus on the more valuable work; providing support and proactive business guidance.

How Coconut helps

At its core, Coconut is an accounting and tax tool - combining expense management, receipt capture, invoicing and tax reports into one simple, easy-to-use app.

We do it slightly differently to some of the other accounting packages out there. When you connect another business account to the app, we use the rich payments data directly from your bank to categorise your income and expenses for tax in real-time, meaning you don't have to do this separately in a different app. You can attach the receipts and notes to all of your transactions as well so everything is neatly stored in one place.

We also estimate how much you need to set aside for tax, so you'll never get to the end of the year with an unexpected bill. You can get the numbers you need to complete the self-employment part of your tax return straight from the app.

And you can manage bookkeeping tasks directly from your desktop if you’re on our professional plan.

Whilst Coconut has a ton of functionality, there are things that you might want to enlist the help of an accountant for.

Preparing for Self Assessment

You can export all the data in your account into a rich CSV which can be shared with an accountant and used to create your end of year financial accounts, which also get used to complete your tax return.

Preparing annual accounts is a specialist activity that accountants spend all day doing, and so we recommend using an accountant for this to make sure you get everything right.


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