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Frequently Asked Questions
Straightforward answers to the questions we hear most often. If yours isn't here, just ask — we're always happy to help.
Last updated: August 2026
Switching Accountants
How do I switch accountants? — It's straightforward. You instruct us, we write to your current accountant requesting a professional clearance and handover of records. There's no contract break fee in most cases, and we handle the entire transition.
Will there be a gap in service? — No. We support you from a service perspective while we are obtaining the necessary records from your previous accountant.
What if my current accountant is unresponsive? — This happens more often than you'd think. In the majority of cases this is just a delay in obtaining the records. We will attempt to obtain records from your previous accountant for up to a maximum of 6 months, after which point we will discuss with clients what options are available to them.
Is it disruptive to switch mid-year? — Not at all. We can take over at any point in your financial year. We'll pick up exactly where things left off.
Sole Trader vs Limited Company
When should I incorporate? — It completely depends on your individual circumstances. We will work with you to find the best option for you.
What are the main advantages of a limited company? — Limited liability protection, potential tax savings through salary/dividend split, more credibility with larger clients, and easier to bring in investors or partners.
What are the downsides? — More admin (annual accounts, confirmation statements, payroll), less privacy (accounts are public), and you can't simply withdraw cash — it must be salary, dividends, or a director's loan.
Can I be a sole trader and have a limited company? — Yes. Some people operate one trade as a sole trader and another through a company. We can advise on the most efficient structure.
Tax & Compliance
When do I need to register for VAT? — You must register when your taxable turnover exceeds £90,000 in any rolling 12-month period (2025/26 threshold). You can also register voluntarily below this threshold if it benefits you.
What expenses can I claim? — The test for those who are self-employed is that an expense must be incurred 'wholly and exclusively' for business purposes. For those who are employed the test is slightly more onerous and requires the expense to be 'wholly, exclusively, and necessarily' for business purposes. Common claims include office costs, travel, professional subscriptions, software, phone, insurance, and accountancy fees. We'll ensure you claim everything you're entitled to.
Do I need to file a tax return if I'm employed? — Not always. You'll need one if you have untaxed income over £2,500, earn over £150,000, are a company director with benefits, or have capital gains to report.
What records do I need to keep? — All invoices (sales and purchases), bank statements, receipts for expenses, mileage logs, and payroll records. Digital records are fine — you don't need paper copies.
How long must I keep records? — 5 years after the 31 January filing deadline for Self Assessment. 6 years from the end of the accounting period for limited companies.
Paying Yourself as a Director
How much salary should I take? — Recent budgets by successive Governments have made this decision much more challenging than it used to be. In short it depends on both your personal and business circumstances. We will work with you to find the best option for you.
How do dividends work? — Dividends are paid from post-tax profits. They're taxed at lower rates than salary (8.75% basic, 33.75% higher, 39.35% additional) but don't attract NIC. The dividend allowance is £500.
Can I just take all my money as dividends? — You need sufficient retained profits to cover dividends. Taking dividends without profits is illegal. You also need a small salary to maintain NI credits.
What about a director's loan? — You can borrow from your company, but if the loan exceeds £10,000 at any point in the tax year, it becomes a benefit in kind. If not repaid within 9 months of year end, the company pays 33.75% S455 tax (refundable when repaid).
Our Services
Do I need an accountant? — Legally, no. Practically, almost certainly yes — unless you have significant financial knowledge and time to spare. A good accountant saves you more than they cost.
How much do you charge? — It depends on the size and complexity of your affairs, so we will always quote you based on your individual circumstances. Depending on the scope and nature of services required we offer both fixed fee and variable rate (time-based) charging mechanisms for clients. Often we apply a variable rate in the first year, and then give clients the option of a fixed rate service in future years when we better understand your business and requirements.
Do you offer monthly payment plans? — Yes. Most clients prefer to spread their annual fee across 12 monthly payments by direct debit.
Can you help with historic issues? — Absolutely. Whether you have unfiled returns, outstanding penalties, or a tax investigation, we can help resolve the situation and get you back on track.
Do I have to be local? — No. While we're based in Prestwick, Ayrshire, we work with clients across Scotland and the UK. We use video calls, cloud software, and secure document sharing.
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