Research and reports
Wondering how to become an accountant? This guide starts with the basics, from day-to-day tasks to training and qualifications, before explaining how to be a self-employed accountant or freelance accountant.
The National Careers Service says that private practice accountants usually have the following day-to-day duties:
Accountants work with numbers day in and day out, so it’s important to be numerically and analytically skilled.
You don’t need a degree to become an accountant, although it can give you useful theoretical knowledge. Instead what’s needed are vocational qualifications (people who have a degree usually need to take these too).
The professional bodies to consider for your qualifications include:
You can also become a qualified accountant with institutions like the ICAEW, CIMA and AIA.
Don’t discount experience when it comes to your training, as many people study alongside a full-time position in the industry. Knowledge of how to run an accountancy firm will help you hit the ground running.
To become a chartered certified accountant with ACCA you’ll need to study for their qualification and have three years’ relevant work experience. To become a chartered accountant with ICAEW, you'll also need to complete at least three years of on-the-job training.
If you have the qualifications and a few years’ experience in an existing firm, you should have a good understanding of the systems and skills needed to be a self-employed accountant.
Qualifications take a number of years to complete. It takes up to four years to do the ACCA qualification, for example.
During this time, you might be working in an accountancy business to build up experience. This work experience usually counts towards achieving chartered status, so be sure to find a relevant role.
If you’ve got experience and now want to be a self-employed accountant or freelance accountant, first you need to decide what type of business you want to run.
Freelance accountants generally work with small businesses – those who can't yet afford to bring in full-time accountancy employees. They provide tailored services to clients, including producing annual accounts, looking after VAT returns, and managing payroll.
Often, freelance accountants also deal with HMRC on their clients’ behalf. This could be as simple as filing accounts. But in worst case scenarios it could also mean the accountant will have to attend visits from HMRC, if a client is the subject of an investigation.
Many accountants are also bookkeepers. Bookkeeping involves keeping records of financial activity, for example through adding payments and receipts, as well as income. These records are then used to prepare the accounts.
Many smaller businesses choose to do their own books to keep costs down, but others use a bookkeeper. When you become a freelance accountant, you should consider whether or not you'll also offer bookkeeping services. It can be a good way to boost your income, but remember that it's also time-consuming.
It’s OK to be a generalist accountant and offer your services to a range of clients. But this might make it more difficult to stand out from the crowd.
You might have a specialist focus. For example, what if you choose to focus on providing services to a particular trade, like doctors, dentists or vets? You can build a reputation for providing a specialist service and clients might be more inclined to recommend you to their network.
Another difference could be the type of service you’re offering, like bookkeeping or tax services.
As you take on more clients and your business grows, you might want to hire staff. You’ll be on your way to becoming a full-fledged accountancy practice. If this is your ambition, make sure you detail your goals in your business plan.
According to talent.com, the average freelance accountant salary in the UK in 2022 is £53,625. Entry level accountants can expect to make £32,156. Experienced accountants could make a lot more.
Be sure to use this as a guide only, as self-employed people will earn different amounts depending on where they’re based and the type of clients they have. If you end up running a full accountancy practice, you’ll have to take the cost of hiring employees and having proper business premises into account too.
As a freelance accountant you'll set your own rates, so research average accountant rates in your area and set yours accordingly.
If you work with small businesses, a full accounting service (covering tasks like annual accounts, bookkeeping, and corporation tax returns) can cost them anywhere between £60 and £250 a month, according to unbiased.co.uk. The fees depend on factors like the size of the business, turnover, and location.
Accountants often charge on top for additional services such as completing directors’ tax returns.
You could also offer services where you charge a one-off flat fee, for example to complete a Self Assessment or year-end accounts. According to unbiased.co.uk, accountants charge between £150 to £250 for Self Assessments, depending on the complexity of the business.
If you’re an experienced accountant who has worked with businesses already, it’s likely that you’ll be familiar with these steps. But it can be useful to have it down in one place, with links to helpful free resources you can download to make it easier.
With any new business it’s tempting to dive right in, but creating a business plan can only increase your chances of success. There are questions you should answer before you start, plus putting your goals on paper helps to give your accountant business direction.
Download our free business plan template with prompts to help you write one.
Any person or firm providing accountancy services needs to be registered with (and monitored by) a recognised supervisory body. These include the bodies mentioned above (AAT, ACCA, CIMA, and ICAEW). They need you to hold a practising certificate and have professional indemnity insurance, plus you should be doing continued professional development.
You also need to have formal authorisation from HMRC to deal with them on your client’s behalf. You have to get an agent code or reference number for each type of agent authorisation.
You should understand and fully comply with industry standard guidelines and regulations. This includes data protection regulations (because you’re going to be keeping information on your clients) and anti-money laundering regulations (to follow these, you’ll need to register with a supervisory authority).
If you’re experienced, you’re probably already aware of this step. But keep in mind all that you have to do when starting any new company. These include:
Read this guide for more steps on starting your business.
Your clients rely on you to be precise with your figures and calculations, but mistakes and accidents can happen, so you should think about accountant insurance.
Professional indemnity insurance is likely to be your key cover. It’s an important consideration for any business that gives professional advice.
For accountants, it can cover mistakes such as professional negligence, unintentional breaches of copyright or confidentiality, loss of documents or data, and defamation or libel.
Other covers include:
In previous years, an accounting firm might rely on a stable set of core clients, but it’s easier than ever for people to shop around and switch accountants.
This is both a challenge and an opportunity. It means you can’t always rely on repeat business. But as a startup, you could take a slice of the market by being proactive.
Finding your niche is a start. Then you can target your marketing more effectively by having a better understanding of the clients you’re trying to win.
These are some of the things you can do to find clients:
Read more about advertising your business.
How are you getting on with setting up your business? Let us know in the comments below.
Sam has more than 10 years of experience in writing for financial services. He specialises in illuminating complicated topics, from IR35 to ISAs, and identifying emerging trends that audiences want to know about. Sam spent five years at Simply Business, where he was Senior Copywriter.
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