New MIP (fingers crossed)

mickwood83

Hi All

I am in the process of becoming a registered MIP with the intention of offering bookkeeping services, year end accounts and tax returns for small unincorporated businesses and self employed.

I am just after a little guidance really, I have been reading many forums which have been informative but am a bit unclear exactly how to ‘go about my business’ so a few pointers would be greatly appreciated!

Here Goes…..

For the last few years I have been helping out a local builder with his accounts (a family friend, who I don’t charge). The scenario is every January he rings me up in a panic saying his accountant wants to see his books as the tax deadline is looming. So he passes me a massive bag of receipts, invoices and bank statements.
The receipts are mostly for materials paid using his business bank debit card. However, he has some credit accounts with suppliers, some receipts are paid in cash or from his personal account and some bank transactions he has no receipts for. I end up putting his bank transactions into Excel, and also recording every receipt onto Excel and reconciling every transaction (which is very time consuming) and then deciding how to deal with the things that don’t reconcile (drawings account, creditor account etc). It’s obviously quite a manual procedure and a lot of duplication, but this needs to be done to identify what is missing?

So after all that my question is would an accounting package (such as VT) have a simpler way of dealing with that problem? Seeing as I have already done all the donkey work myself in Excel I simply add a few formulae and create his P&L and BS from there. Obviously just starting up I don’t have a lot of spare funds to be splashing out on software just yet if it can be avoided.

Is this the typical client I should expect, or is he just one of the few badly unorganised people I should be avoiding? (Although hopefully once I get the green light I can whip into shape)


Software
I have read a lot about tax software but as sole traders and partnerships only need to complete a self assessment isn’t it simple enough to just print a P&L and simply complete the relevant boxes on the HMRC website? I have helped a few self-employed fiends complete their tax returns online and it was pretty simple. I understand it will become more complicated when I am confident enough to take on ltd companies and tackle corporation tax, but until then do I really need Tax software?


Sorry for the long post, there are a few questions hidden in there so any help would be greatly appreciated. I think I probably know the answers to a few of them but there’s nothing wrong with getting another opinion! 

reader

mickwood83 wrote: »

Hi All

I am in the process of becoming a registered MIP with the intention of offering bookkeeping services, year end accounts and tax returns for small unincorporated businesses and self employed.

I am just after a little guidance really, I have been reading many forums which have been informative but am a bit unclear exactly how to ‘go about my business’ so a few pointers would be greatly appreciated!

Here Goes…..

For the last few years I have been helping out a local builder with his accounts (a family friend, who I don’t charge). The scenario is every January he rings me up in a panic saying his accountant wants to see his books as the tax deadline is looming. So he passes me a massive bag of receipts, invoices and bank statements.
The receipts are mostly for materials paid using his business bank debit card. However, he has some credit accounts with suppliers, some receipts are paid in cash or from his personal account and some bank transactions he has no receipts for. I end up putting his bank transactions into Excel, and also recording every receipt onto Excel and reconciling every transaction (which is very time consuming) and then deciding how to deal with the things that don’t reconcile (drawings account, creditor account etc). It’s obviously quite a manual procedure and a lot of duplication, but this needs to be done to identify what is missing?

So after all that my question is would an accounting package (such as VT) have a simpler way of dealing with that problem? Seeing as I have already done all the donkey work myself in Excel I simply add a few formulae and create his P&L and BS from there. Obviously just starting up I don’t have a lot of spare funds to be splashing out on software just yet if it can be avoided.

Is this the typical client I should expect, or is he just one of the few badly unorganised people I should be avoiding? (Although hopefully once I get the green light I can whip into shape)


Software
I have read a lot about tax software but as sole traders and partnerships only need to complete a self assessment isn’t it simple enough to just print a P&L and simply complete the relevant boxes on the HMRC website? I have helped a few self-employed fiends complete their tax returns online and it was pretty simple. I understand it will become more complicated when I am confident enough to take on ltd companies and tackle corporation tax, but until then do I really need Tax software?


Sorry for the long post, there are a few questions hidden in there so any help would be greatly appreciated. I think I probably know the answers to a few of them but there’s nothing wrong with getting another opinion! 

1) I would probably invest in VT; you'll probably be able to recover the cost of VT just by charging for 2 personal tax returns.

2) In my experience, you have a typical client (i.e. dis-organised).

3) If you know how to do the tax return on HMRC's website then I would have thought that there's no point buying tax software.

bigmuggsy

Don't do it I hate clients arrrrgghhhhhh!

Only joking, I've built up a practice with my business partner from scratch and four years later have over 250 plus clients so have experienced alot of what a small firm can thrown at me, if you need any help or advice feel free to email me anytime; mike@prime-accountancy.co.uk.

Cheers



Mike

Audriann

Does anyone know if VT does final accounts?

I wanted to use VT and Taxcal for my practice and wondered if that is all the software I would need, My clients will be sole Traders, Paternerships and Ltd's.

Can anyone help me please?

mickwood83

Thanks for your advice. I did download a free trial of VT last night and it looked pretty user friendly so maybe that is the way forward.

My client has still paid his accountant a similar fee every year since I started doing his bookwork than he did when I didn't organise him. The accountant must be laughing as charging the same rate despite not having to go through the carrier bag himself (about £450). The business is not incorporated so in reality this fee is to simply check my figures and file his self assessment tax return? That sounds steep to me but maybe I'm being naive.

There are a couple of 'other creditor' amounts which I do need to dig into but now I am 'legit' I am happy enough to go down the official route and contact the accountant for breakdown of the balances I am unsure of. Then I can take the reigns and organise him better.... or at least start looking at his 12/13 accounts before 15th Jan 2014!!!

A great tip, I will definitley be using the high/low quote method when I start to pick up some clients, like you say would feel a lot more comfortable charging a proper rate for the high level stuff rather than wasting away hours/days sifting through receipts!