I prepare the books for a couple of friends to Trial Balance, and run the payroll for both. I do this on a volountary basis as I am a stay at home mother and simply enjoy bookkeeping.
I prepare the Bank, Cash, Sales and Purchase Ledgers. Bank, Sales and Purchase Reconciliations monthly.
Run weekly payroll and recocile at year end.
One client is VAT registered and I prepare the return.
Extract a Trial Balance at year end.
These all go to the respective accountants at the year end, and the feedback from them is excellent.
Would it be enough to market myself as a bookkeeper to trial balance in order to start a business? I would prefer not to prepare accounts or submit SA Returns at the moment.
I have an HND in bookkeeping and spent 5 years as a bookkeeper/accounts/payroll assistant before leaving to start a family.
That does sound like enough experience to do bookkeeping as a business. I would say for any bookkeeper it is best to leave the accounts and tax returns to accountants.
I would say that now with the credit crunch so many people are being made redundant and so many people setting up as bookkeepers it is that much harder to gain clients because the competition is that much more, I started my business in August 2006 and would say it was easier getting new clients then it is now, but even back then you had to work at promoting yourself and sending out mailings and advertising in various ways to gain these clients.
Would say that if you don't work now then you have nothing to lose in setting up a business (assuming you already have a computer) there are not that many start up costs - if you have a computer and a printer you could create your own business cards (just the cost of ink for printer and card (and there are some shops where you can get a large box of card for around £7.)
If you have a job that you are thinking about giving up to run own bookkeeping company then you would have to serious consider if giving up job worth it as takes some time (especially in these times) to get a client base enough for full time work (even enough for part time work).
Hi, I think you are well qualified to set up your own bookkeeping business. However, as Alison has said and certainly in my own experience you will earn far more if you have a job in a bookkeeping role whether it is part time or full time. Also, you do not have to be registered with HMRC or with one of the Institutes if you are employed, but you do have to be registered if you are self employed or even if you are doing bookkeeping voluntarily. In my experience there is not alot to be gained by being a member of an institute just alot to pay out to them. But at the end of the day it is a personal choice.
In my case I started my bookkeeping company based on experience alone. I was not gaining all the potential clients I could because they asked what qualifications I had.
When I got the ICB exams to the point I could be an associate member with practising certificate and Prof Ind Insurance I gained more new clients. You can use the Institute logo on your advertising, letter heads etc.
Hi, You have a very valid point Alison but my experience has been quite different. Although I am registered as a self employed bookkeeper it is a small scale operation as I am also employed full time. I have a few clients I do work for outside of my full time work and although I have shown them my practising certificate and my bookkeeping certificates to be truthful none of them seemed that interested, they were just interested in me keeping their books in good order for them. So personally I don't think there are any great benefits from membership of institutes. They have great websites but then they bring in large incomes from membership fees and all the other fees. That is just my experience but it's good to read all the different viewpoints.
To be honest Steve, I'm not sure I entirely follow the logic of your argument.
If you are registered with either of the two bookkeeping organisations (IAB or ICB) then you are covered for the MLR requirements by your institute membership.
If you're not a member, you have to do this separately through the HMRC at a cost of £95. It's cheaper to do it through your membership as it covers you for this.
Hi Mike With the ICB/IAB in order to practice as a self employed bookkeeper you also have to purchase a practising certificate in addition to membership fees so I think the total cost is about £120 although I don't have exact detail to hand. If you are in full time employment as a bookkeeper it is not necessary to register for MLR nor is it necessary to be a member of any institute. That's my understanding of it.
With Institute of certified bookkeepers, you do have your membership cost (£60 associate and £66 full) and practising certificate £66. So Either £126 or £132 and the Professional Indemnity insurance that is advisable to get anyway even if you register with HMRC so you are looking at only being £6 or £12 more a year and get all the benefits of the institute - job vacancies that has adverts for freelance part time work as well as full time vacancies.
I suppose whatever way you look at it, it is the self employed bookkeeper who will have to hand over at least £120 a year, either to HMRC or one of the bookkeeping organisations. At the end of the day I think it is HMRC and the bookkeeping organisations that are raking in all the money whilst most self employed bookkeepers will struggle to make a modest income whilst at the same time having to comply with more and more regulations. That, in my view, is the reality of the situation.
I'd agree with the others that you would be in a position to market yourself - and to provide payroll and bookkeeping services to Trial Balance stage.
I'd suggest offering a full service though, using an accountant for year end statutory compliance so your clients are looked after from go to whoa.
Also try to get testimonials from those accountants or others which you can use on your website, marketing material etc. Real testimonials from real people and businesses (include their details and who they are) can help quite a bit.
I also understand what Steve is saying about earning more in employment. Of course not always the case, and can depend on the way you charge (eg flat fee and working efficiently can help). Many do themselves short without realising it which is why we posted the blog entry - What Hourly Rate?
