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Jul 15

A Short Guide to Switching Accountants

Reading Time: 3 mins

For many businesses, an accountant is an indispensable part of ensuring their financial stability. Not only do accountants ensure that your taxes are filed correctly, but they can also assist in planning and forecasting, helping your business to grow. However, just because you’ve been partnering with an accountant for some time doesn’t necessarily mean you must continue your relationship with them forever. In fact, an accountant that was right for you at the start of your business journey could no longer be suitable as the years pass by.

Signs it’s time to change your accountant

It’s never easy to part ways with a professional who has provided you with a high level of service in the past, but sometimes finding a new accountancy firm is essential to securing your business’s future. Signs that you may need to switch your accountant include:

  •       A decline in the quality of work you receive or a lack of responsiveness from your accountant
  •       Your needs have changed and your accountant is unable to fulfil them e.g. perhaps you now need advice on business growth rather than tax matters and your accountant lacks expertise, or the volume of work you have for them has increased beyond their capacity
  •       Your accountant has changed their prices and is no longer affordable for you
  •       Communication is a challenge and you’re often left confused about your financial situation

Whether you are having issues with your accountant or simply want a fresh perspective, switching accountants can be a smooth, stress-free process.

How to switch accountants smoothly

Once you’ve decided that you definitely want to switch your accountant, follow this step-by-step process to ensure your transition is as effortless as possible.

Decide on a time

Switching your accountant can be something of an inconvenience, especially if you choose the wrong moment. It’s usually a bad idea to change accountants in the middle of your tax return or the deadline. Any delays in your switch may result in documents being filed late or even incorrectly if the information has been mislaid. Equally, if your current accountant is in the middle of communicating with HMRC, it may be best to allow any issues to become resolved before disrupting their workflow.

Research your new accountant carefully

Before switching to a new accountant, arrange to meet with them or book a phone/online consultation that will allow you to have all your questions answered. You may want to ask questions about which accounting software providers they partner with such as Sage, Xero, Quickbooks etc as this may influence how smooth the transition is from your existing accountant. You may also want to ask for testimonials from their existing clients and/or search third-party review sites for independent feedback on their work. 

Terminate your account

It’s best practice to terminate your contract with your current accountant by writing them a letter. In this, you should inform them of your intention to seek services elsewhere and request essential documents or information that your new accountant requires. If you expect your current accountant to complete any projects before you leave their services, detail these in the letter as well. You may need to negotiate with your accountant before terminating your contract, especially if you agreed to pay for services that span a certain time period.

Undergo registration

Your new accountant will require you to undergo a registration process before they begin working with you. You’ll need to provide them with both personal and business details as well as a copy of your passport to enable them to comply with the government’s anti-money laundering laws.  

Before finalising your registration, carefully read your accountant’s letter of engagement. This will allow you to check that your expectations will be met moving forward. If your accountant is not part of a certified accounting body, they will not be required to send you a letter of engagement. However, it is strongly discouraged to use the services of an accountant that is not associated with a professional regulatory board.

At the end of the registration process, you will be asked to sign a 64-8 form that authorises your accountant to submit your tax return on your behalf. Your new accountant should also contact your previous accountant to request professional clearance. Your previous accountant will then provide your new firm with any relevant tax records and copies of financial documents that are required of them.

Find your ideal accountant today

There’s no reason to settle for subpar service when there are hundreds of highly qualified accountants to choose from. As long as you think through your choice and choose the right moment to switch services, your business will be able to reap the benefits that come with expert financial advice.

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence. 


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