How to set up your own accountancy business

There are lots of advantages to working for yourself. You can set your own hours, choose your own clients, and decide where and how you get the job done.

But how do you go about becoming self-employed, or even establishing your own firm? Find out with our step-by-step guide to setting up your own accountancy business.

1. Get qualified

If you want to set up an accountancy business, you’ll need certain qualifications under your belt first. And the best way to instil confidence in your clients is to equip yourself with qualifications from a renowned body such as AAT, the UK’s leading professional membership body for accountants.

Whether you choose to study part-time, full-time or online, an AAT course is a great way to get started – or move up to the next level. “The first step to becoming a qualified stay-at-home accountant is to start studying,” recruitment company Reed said in a recent blog.

“With courses to suit all experience levels and the option to study full-time, part-time, or entirely online, there’s an AAT qualification out there to suit everyone.”

Philippa Shipp, founder of virtual PA and bookkeeping service Miss Kantoor Virtual Assistant, agrees that qualifications are important – even if you only want to offer relatively simple accountancy assistance.

“Bookkeeping is not a regulated industry, so you don’t need qualifications if you have the relevant experience,” she says. “However, industry recognised qualifications such as those available through AAT can be very useful.”

2. Gain experience

It’s not vital to have experience before setting up your own business, but it will help you to find clients and to improve your practical skills and knowledge.

Working in a full-time job for a while, taking on a part-time role, volunteering in a finance department or even doing accounting work for your friends and family are all good ways to learn the ropes.

You might even realise that you prefer being an employee if you find the right job at the right company. Craig Moore worked as an accountant for several years before setting up his business CJM Associates in 2011.

“It’s useful to have an idea of where you want to end up, but it’s also important not to create a path set in stone,” he says. “Many partners of successful accountancy practices trained in industry, and many successful financial directors started in practice.”

3. Set up your business

Once you’re ready to branch out on your own, the first thing to decide is how to set up your business. You can create a limited company or start off as a sole trader; the choice is yours.

The type of business you choose will affect the steps you’ll have to take to adhere to legal standards, as well as the type of taxes you pay. So it’s worth taking the time to think about what is the right option for you.  

If, for example, if you decide to register as a limited company, you’ll need to register your business for tax, open and business bank account, and obtain the necessary permits and licences.

“To offer bookkeeping services, you will need anti-money laundering supervision from an accounting body or from HMRC direct, and to be registered with the ICO for data protection purposes,” Shipp says.

4. Make sure you have the tools of the trade

In order to run a modern accountancy business, whether as a sole trader or a company director, you’ll need to invest in accountancy software of some kind, as well as various types of insurance.

“For example, you will need professional indemnity insurance to offer bookkeeping or accountancy services,” Shipp says.

And to maximise your chances of success, it’s a good idea to develop a realistic business plan too. “The transition from employed to self-employed can sometimes be challenging,” Moore says.

“My advice would be to make a plan with achievable goals. Whether that’s to start on a certain date, employ x amount of people or to find x number clients by a certain date, you need to know where you want to be and how you’re going to get there.”

5. Build a client base

Good marketing is key to the success of any business. “The most difficult part of business for any new venture is getting new clients and gaining traction in the industry they’re based,” Moore says.

To build a client base, a slick website is a must. Other useful steps you can take include attending industry events where you can make contacts, asking existing clients for feedback and referrals, and advertising your services via freelance websites.

It’s also crucial to get your pricing right. “I’d advise setting prices based on your level of service and sticking to them,” Moore adds.

“I was always told, if you win a client based on price, you’ll lose that client based on price, and there’ll always be someone cheaper than you. So, believe in your services and believe in yourself!”.

In summary

Setting up your own accountancy business can be a great career move – but only if you get it right. Things to consider include:

• Do you have the necessary qualifications?
• Are you experienced enough to manage your own business?
• What type of business do you want to set up?
• Do you have the necessary insurance and registrations?
• How do you plan to market your business?

Further reading

• 4 reasons now is a great time to set up as an AAT licensed accountant
• Start marketing your business with these 3 tools
• How important is mindset in running a business?
• How to start a business UK (Informi)

The content team are the owners of AAT Comment.