Has Things picked up for Self Employed/Limited Company firms of Bookkeepers? - The Book-keepers Forum (UK)

Alison · Senior Member

Has Things picked up for Self Employed/Limited Company firms of Bookkeepers?

lor · Guru

It has gone quiet for me, currently one monthly customer, hopefully there is more around the corner, I was flat out (on a part time basis, didn't have time to think!) from end of sept to end jan dealing with self employed, fingers crossed some more work soon.

Alison · Senior Member

Hi Lor

Thanks for the reply.

Sorry to hear it has gone quiet for you too. Just out of interest which part of the country do you live? Was wondering whether the problems were geographical or if it is all over the country.

Thanks

Alison

RobH · Expert

I am sorry to hear that some of us are struggling and I'm sure it is partly down to location but I think probably alot to do with marketing. It is totally different for me, last week I picked up 4 new clients and a telephone answering client. This afternoon I have a prospective new client coming in to see me.

For marketing nothing beats networking in my opinion. I do offer year end accounts and as such I cut out the expensive accountant in their city centre offices but I call myself n accountant who is happy to take on the bookkeeping only if necessary. I have arrangements with qualified accountants who I sub work out to (ie the stuff I do not feel qualified to do, i.e. Limited companies), but the customer is mine, I will have the meetings with the client and the turnover remains with my company. I think you need to have a good grasp of tax to do this but it certainly helps when marketing yourself.

My biggest client is a bookkeeping job (without any other services) and I charge out around £500 per month for that. My next two biggest clients are payroll only jobs which both get charged out at around £250 per month. In April I am starting another bookkeeping job at £200 per month. I mention these because although I am not doing the final accounts/tax for any of these jobs, the clients all have a perception that I am an accountant and that they are getting better value for money for doing bookkeeping and payroll.

I hope this helps.

Shamus · Forum Moderator & Expert

Morning Rob,

I've never once mentioned to a client that I am anything other than a bookkeeper but similarly they have the impression that I'm further up the tree than I really am.

I think that it's a confidence thing that clients just pick up on.

Of course, thinking that through logically doesn't that mean that clients are only really interested in dealing with accountants even to do just the bookkeeping and we're winning the clients because they think that they're getting cheap(er) accountant?

I think that your networking strategy is now paying dividends. A lot of bookkeepers would drop out of your approach as it's months of shelling out before seeing a penny in return. Personally I think that it's the best approach that you've adopted and as soon as all of these exams are out of the way I'll be following in your footsteps.

At the moment mines still the methodology of trying to pick up just one new client every month. When I first started I tried the spread shot approach that most bookkeepers go for but I never received one client from that! Pretty sure that the only people that ever make money from that approach are the printers!

In one reply that I read you stated that you wold not do final accounts for less than £100! Think that your robbing yourself on that one matey. I'm not allowed by the ACCA to do final accounts or give tax advice yet but if I was there is no way that I would take on that level of responsibility for less that £200 (plus VAT) and that would really be for the simplest return.

Actually whilst we're talking money. My accountant is forever trying to sell me hand holding insurance for if I get investigated. Have you thought of offering that to your clients? Investigations are still not that common so could be £80 p.a. for zilch.

Right, back to capital allowances. Talk in a bit,

Amigo #3

RobH · Expert

Morning amico no.3!
I take your point that going by my way of attracting new clients makes it look like marketing as bookkeepers it will be difficult to pick up new clients and I think to a degree that is correct. It is all about perception. As you know I'm not a qualified accountant and I rarely actually state I am an accountant (apart from what it says on my business card) but I do let people jump to that conclusion because I run an accountancy/accounting practice. You hit the nail on the head about confidence though. If you confidently let people know you do tax returns then you automatically become an accountant!

When I said £100 for final accounts/tax return it was because the original poster (Was it Lorraine?) said she billed £50 per month for the bookkeeping already and was suggesting £50. I think £50 is undervaluing it so I encouraged £100, however I do have some on £50 per month and I include tax return and finalaccounts since the work during the year is easily covered.

Interesting about the insurance, I could do with knowing a bit more about that Shaun.

Amigo 1 or 2?

lor · Guru

Yes, Rob H, it was me!. It sounds as though you are doing really well.

My query was that I am currently charging the client £50.00 per month not including the tax return and final acs, and would it be appropiate for me to charge extra for this?

I am thinking now that to not charge extra would be silly and undervaluing myself.

-- Edited by lor on Monday 15th of March 2010 12:15:36 PM

Shamus · Forum Moderator & Expert

Hi Rob,

I call it hand holding insurance but I think that officially it's called a professional warranty.

just dug out the last one that they sent me.

The exclusions are :

doesn't cover the client for work not related to that carried out by the accountants

doesn't cover anything prior to the start of the warranty

doesn't cover accounts, tax or VAT submitted late

doesn't cover matters where the revenue alleges fraudulent evasion of tax or VAT.

So basically just seems to cover the random investigations that do happen but not that often.

The warranty covers the accountants time :

dealing with correspondence

preparing documents & reports

attending meetings

attending hearings & tribunerals.

Additional costs include :

Appeals

Legal costs

The only copy of the cover that I can find is one from 2005 and the costs then inclusive of VAT were (sure that they've gone up now by around 15%).

Sole Trader £35.25

Partnership £70.50

Limited Company £70.50

Hope that this ends up with another income stream... Would now be a good time to mention commission! Just joshin.

talk later,

Shaun.

Shamus · Forum Moderator & Expert

Hi Lorraine,

If your in a position where you are able to prepare final accounts (namely that you supervisory body allows you to prepare them for the legal form of the client) then for that service alone you should be looking at £200 plus dependent upon the complexity of the organisation.

If the client would rather go to an accountant to prepare their final accounts then let them as they'll pay at least double what they would have paid you so next year they might reconsider their choice.

All that your monthly fee is for is to keep their records straight. Year end reporting is another service above and beyond that which they can either choose to use yourself or indeed an accountancy practice for.

Of course, if they do choose the accountancy practice I would say that a reasonable amount of liaison with the accountant should be included in your normal monthly fee to your client so would be adverse to charging a fee just for handover to the accountant... You can try it but personally I wouldn't as it may cause more bad will with the client than the funds gained are worth.

Shaun.

RobH · Expert

Hi Shaun,

thanks for the info. The only timeI looked at something like this, the insurers basically said I had to have something like an 80% take up otherwise the charge would increase considerably per client. It did make me consider whether I could self insure. Charge everyone £50 per year and hope I have no investigations!

Me and my income streams! One day I'll get an income torrent and then the commission can flow too!

RobH · Expert

Hi Lorraine, one of the problems with not charging extra is that it will be difficult to change that for the years to come. I think it is important not to undervalue yourself and by offering this type of service you begin to elevate your status amongst your clients and prospective clients. £50 is far too low and you may want to go with Shaun's thought of £200 if you think it would be acceptable as he is right there will be many accountants who will charge double that (but not all).

Funnily enough I lost a client on Friday. She was a lady who is employed full time and does a bit of self employed dance teaching. Her turnover was £750 and I put as much as I could for legitimate expenses but she was aghast taht she had a tax bill (Just over £100). She is changing to a chartered accountant and I charged her the ridiculously low amount of £85 plus vat on the grounds that I felt a bit sorry for her and that the job took no more than an hour. She won't get a better result vis a vis her tax bill by going to a chartered and I cannot see she will get a better price but I suspect she feels there is more value to be got elsewhere. Or maybe it was something I said!

Shamus · Forum Moderator & Expert

You don't think maybe it was rolling around the floor in hysterics when the client described teaching dance as a business? Sorry, cynic! My eldest boys dating someone who goes around schools teaching through the medium of dance... What a crock of s...

Anyway, bygones.

We all get them Rob.

I think that the assumption of some clients is that they pay a bookkeeper / accountant OR tax. I think that they should look at it more as pay us OR fines!

Thinking about those figures though, dependent upon your clients other income if she had paid herself everything as salary she would have had no tax at all on that amount of turnover so she should get it back when she does her self assessment.

Moving from £85 to a chartered accountant! Boy is she in for a surprise when she gets the next bill!

Maybe you need to explain her financial options though interpretive dance Rob! (lol).

RobH · Expert

Her other income was a full time job so her PA was used in full. This was a little bit of self employed income. I'm laughing at the interpretive dance...think it may involve a lot of stamping feet...and now I am a tree...swaying in the wind!

I take your point on pay an accountant or tax. The amount of people who have spoken to their mate in the pub who told them that if they got a good accountant....... Feel like suggesting that their p*ss*d up mate down the Nag's Head could do it for them!

Amanda · Expert

Or they say in the pub, my accountant saved me £x he could save you loads and infact they are as dodgy as I duno what!!!!

Heard about a few of them recently, the problem is the clients' don't realise that every business is different, so they may have to infact pay some tax!!!

Sometimes its like beating your head against a brick wall.

A

RobH · Expert

Yes there are definitely a few dodgy ones out there Amanda...difficult to compete with them! Have you also noticed how many accountants are drunk the whole time.I had a client come to me as his accountant was always drunk, he said he asked for his paperwork back, the old accountant stood up, fell over and passed out. My new client stepped over him and went through his filing cabinet until he found his file which he brought in to me!

Amanda · Expert

That is unbelievable!!!

Heard of a guy the other day, not an accountant, not sure what he does, but anyway one of my clients was doing some work for him, and he is a millionare, (not my client),anyway he said hes thinking of moving to the Isle of Man to avoid the tax as it would save him a whopping £6 million pound!!!! We came to the conclusion he obviously got too much money!!!

As we said we are here trying to make a living in these difficult times.

Think that Accountant needs to join the AA!

Amanda

-- Edited by Amanda on Monday 15th of March 2010 04:06:14 PM

Amanda · Expert

Out of Interest Rob, do you hire Premises or work from an Office at home? The Picture looks like a decent size office somewhere.

And do you have someone working alongside of you, or do the people you use work from their homes etc.

cheers
A

RobH · Expert

Oh too have the problems of paying £6million in tax!

I have bought a small house in a semi commercial/residential area. It is quite unusual, it used to be the railwayman's cottage many years ago and has been used as commercial property ever since. The room in the picture is the conservatory, but I have now put all my filing cabinets in there as it's impossible to work there as it is too noisy when it rains, too hot if the sun shines (Not a problem too often) and too cold most of the time. The building has two rooms upstairs which are used as my office and a meeting room, and one large room downstairs where my bookkeeper works from. The kitchen area is converted into the reception since it is where the front door leads to and is where my receptionist sits. My bookkeeper works 4 days a week (around 100 hours per month) self employed. My receptionist works 9am to 1pm. When I am realy busy or for more complicated work I use an ACCA for bookkeeping. She charges me £15 per hour but she is red hot so I don't mind paying that and I will usually at least get to double up on her costs. I also 'sub' out to another ACCA who is happy to come here and do Ltd co accounts on my system (I use IRIS) and a CTA. Despite all this help I seem to be working for too long fending calls, seeing clients and doing the networking!

How about you?

Lisa Jo · Senior Member

Good on you Rob, you seem realy busy & it has gone really quiet. I have some year end work thats coming through - Ive knicked that off another accountant. Will pass it to them all prepped & see how much they can save this year, the accountants were charging him £1200 for a small partnership.. wil keep you all posted as to how much they overinflate these fees..

RobH · Expert

Good stuff Lisa, it's great when you can see what the previous accountant has charged. I had a new client in this afternoon, he runs a dog walking business and does his own Sage. He employs half a dozen part time walkers but the turnover is pretty small. His present accountants charge him over £1000 to do year end accounts and tax. I was originally thinking this may be around £250 plus a bit more for tidying the Sage up. I have now gone in with £500 for year end and £20 month to do monthly payroll and I shall be doing a bit of Sage training (yuk!) but more than likely once a quarter get a back up and reconcile the bank and do a general tidy up. I'll probably charge a further £15 to £20 an hour for that. Client is delighted.

Amanda · Expert

Hi Rob,

The railway cottage sounds ideal.

I'm only part-time due to 2 kids (shaun says children!), but my business plan is to maybe look at moving in the next few years and buy something with a bigger garden so I can build an office there. I work for someone who has one of these in the garden he had it purpose built, underfloor heating, double glazed etc and its just what I would like later. Plus working out of the spare bedroom although its a reasonable size its not bigger enough comfortabley for 2.

I have enough steady work to work between 15 and 25 hours per week depending which month it is, so that will do for now, stoppped advertising over a year ago due to be inundated with calls. At the moment can't decide whether to take on another or to concentrate on my Payroll exams and then enrolling on AAT tech later.
Got another client in the pipeline, but will have to wait and see what happens, not chasing as need to study instead. I have noticed that things are picking up as the clients I have are getting busier which in turn means I will get busier!

Sounds like from a previous post that maybe you were once a Salesman Rob?

Cheers
A

-- Edited by Amanda on Monday 15th of March 2010 10:15:43 PM

RobH · Expert

Oh you are doing really well Amanda and sounds like you have a good work/life balance with the kids (Yes I'm common too!). I think you will like to be out of the spare room in time, even if it's a short trek down the garden to the ofice it gets you out of the house and you can separate work from home to a degree.

No I've never been a salesman, not sure what thread I inferred that! Mind I do tend to think of getting in a new client as the end of the job rather than the beginning and I do enjoy that side of things!

Amanda · Expert

Yes I know what you mean about separating work from the house, a garden office would be nice, you can get those log cabins quite cheaply thats what my client has, I love working there as the aspect is so nice, great space as well, I was surprised at how good it actually was. Also its cheaper than renting premises, and I want to be here for the kids, but thats a little way down the line yet. Luckily Hubby has a good steady job, so at least part-time id fine for the time being.

I thought you were a Salesman previously as one of your posts you were encouraging someone to call back a client who may be abit slow off the mark, and that sound just like me, I was into Sales for years and got bored and retrained, but the Sales side never quite goes away.

Anyway client that is in the pipeline (which I thought wasn't going to happen, have known him for ages), has e-mailed and said wants to arrange a meeting one evening soon, so will see what happens. His mum does it on excel at the mo, and hes now got rid of his very expensive accountant, he was being ripped off and I told him to find one more local that would charge him alot less, so he has now done that which is good. He was grateful for the advice.
Best go got lots to do today.

Amanda

RobH · Expert

I think you have to be a bit of a sales person if you are self employed Amanda, no doubt that is one of the reasons you are doing well. It's the old adage, 'people buy people'.

Thats good news about him wanting a meeting, sounds like another in the bag and a step closer to the garden office!

Have a great day.

Amanda · Expert

Yes hopefully looking good, I am going to stop getting clients after this one as really need to get some serious study in, and need to balance work, study and home life. Just about manage to juggle all at the mo.

One good way of networking for those of you that have children is offer to be treasurer of the PTA, I know you don't get paid for it, but you do get noticed. My friends volunteered me for ours because they all know what I do.

Cheers
Amanda

lor · Guru

Your doing really well Amanda, well done.

Rob H & Shamus who have given me food for thought on the TAX Return and Year End side of things, and have reminded me that I started this to make money, not for "free", so thank you so much for all your support!

RobH · Expert

Sometimes I think it is hard to remember that what you are doing is offering an excellent service Lorraine and as nice people we can fall into the trap of doing favours, but this is your living and you are seliing your time, skill and knowledge. Fortunately virtually all of our clients are in business and understand this since it is what they are doing too!

Marky65 · Guru

Hi Alison

It is good to see you back posting on here.

Recently things have picked up for me within the last month, my payroll client now wants me to do their bookkeeping. I found another new client by answering posts on another business forum, I gained another one last week by responding with an email and follow up phone call after I received a lead from my freeindex.co.uk listing. I have a meeting with a firm of accountants next week who I have just submitted a closing tb to for them to complete the ltd company accounts & returns. So as you can see there is no one right way to gain clients at the moment.

Good luck with your business and attracting clients

Regards

Mark

Alison · Senior Member

HI Mark

Well done on gaining the new clients.

I finally got a new client enquiry - have a meeting on Friday.

My husband (the other director of Limited Company) was gloating that he was right and knew best, I did not want to put adverts in newsagent windows but he said that is the only way that has ever worked for me and he made me put adverts up in several towns near me, and I told him it would be a waste of time and money but hopefully it has worked.

Thanks

Alison

Marky65 · Guru

Hi Alison

Good luck for Friday

Just out of interest, do you just put your business card in the shop windows or do you use something else.

Regards

Mark

Alison · Senior Member

Hi Mark

I have a postcard size advert that is basically just a bigger version of my business card but with a little more detailed information.

Alison

Marky65 · Guru

Thanks Alison

There's another thing to do