Ten reasons why you should hire accounting services for your Limited company

Ten reasons why you should hire accounting services for your Limited company

December 04, 2023

Accountants play a crucial part in the growth of a company. While many small businesses choose to manage their bookkeeping by themselves, there are many advantages of hiring an accountant who is chartered. Here are the main reasons to hire the services of an accountant for limited company to run your smaller business below.

1. Time-saving

Apart from general bookkeeping, companies with limited funds have different accounting obligations, which include making annual statements and preparing tax returns.

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The entire process takes away valuable time that could be better utilized in other aspects of the business. Since accountants regularly perform these kinds of jobs and are able to complete the work more quickly and efficient, which could make a difference to a company's time and cash.

2. Tax efficiency

One of the major reasons businesses employ accountants is to lower their tax burden overall. Knowing the different deductions that are available (e.g., expensescapital allowances and various tax reliefs for companies) and the best method to handle profits to reduce tax burdens can prove valuable to the financial wellbeing of a business.

Accountants can make sure that businesses are in compliance with their tax-related legal obligations while making use of any tax benefits which can help optimize the net profit.

3. The filing of accounts and tax returns

All limited companies must prepare annual statutory financial statements, which include:

  • The Profit and Loss (P&L) statement
  • Balance sheet
  • Any notes that are not related to the account
  • There are certain deadlines and methods for filing the accounts.

Alongside the annual financial statements, businesses must submit a tax return for their company each year. This is a report of loss and profit to calculate corporation tax (which differs in comparison to the P&L statement that is prepared to accompany annual financial statements).

There are separate deadlines for submission and the payment of the corporation tax.

A third annual filing that is required includes the confirmation declaration (previously called an annual report). This is a document that confirms the registered data of a business (e.g.the registered office, directors appointed or shares issued) to ensure it is certain that Companies House has the most current information available on the public register.

Filings for the year - What is required by your company has to file

The majority of directors in companies will have to file a Self Assessment tax return once each year. If they receive the salary along with dividends, it could be quite difficult to do the appropriate calculations and complete the different forms.

A accountant for a company will be competent to handle the filings required by law as well as tax return filings, making sure that all of them are correctly completed and filed in time. This can help save a lot of time and effort and enable business owners to concentrate on the task of running their company.

4. Tax deductions

There is a variety of capital allowances, expenses and other tax reliefs that can aid in reducing the overall tax burden for a small business and increase profits.

Knowing which expenses cannot be deducted in the preparation of corporate accounts is as crucial as knowing which costs could be employed to reduce profits. Making the wrong choice could result in fines or even criminal penalties. A professional accountant will ensure that all deductions permitted are in compliance with the current rules and rules.

5. Staying clear of tax investigation

Each year, HMRC conducts thousands of investigations into corporate tax affairs that they refer to as Tax Compliance Audits. While a few of them are regarded as routine checks, vast majority are caused due to a warning sign, such as obvious discrepancies or clearly inaccurate figures, or even filing late returns.

Accounting professionals help businesses stay on the top of filings and make sure that they are in compliance with the law. This results in HMRC will be less inclined to perform a compliance test which, in turn, reduces having to spend the effort and time needed to comply with any formalities associated with an inquiry.

How much tax will an unincorporated company have to pay?

Additionally should a spot-check is followed by a full enquiry opening, the knowledge the books are in order by the accountant gives an additional sense of security.

NB: It's often speculated that merely the appearance that an accountant manage an account of a limited-company may lower the chances of a compliance audit however the validity of this assertion is still unknown.

6. Avoiding fines and penalties

Tax returns that are not filed on time or in error or other corporate filings could result in a variety of penalties and fines, such as being able to have a company stricken off and directors disqualified or even criminal penalties.

One of the most important responsibilities of an accountant is to make sure there is that there is a regulatory compliance in accounting matters and to ensure that the reputations of directors and companies do not suffer because of errors or inaccuracies when filing annual reports, etc.

7. Software and Record-keeping

Smaller companies with a lot of transactions might have difficulty keeping accounts using accounting software. The cost of dedicated software aside however, there is a steep growing curve of learning to utilize this software and a lot of time is required in order to utilize accounting programs efficiently. It's often simpler to hand over the company's documents to an accountant who won't only have access to their personal account software. They will also be proficient in the use of it.

8. Business plan

It is usually hard for entrepreneurs who are occupied by the day-to-day demands to evaluate their financial position and think about the strategies they will employ in the future.

A competent accountant can assist directors of companies examine their current situation and analyze seasonal trends and utilize various bits of financial information to determine the best way to capitalize on any opportunities.

Accounting professionals can assist with forecasting of cash flow to help directors make the right choices at the right time.

9. Best practice

Accounting professionals can assist business owners to develop methods that are best practices for dealing with accounts for their company. They can provide advice on the most effective record keeping software, help you determine the best times of the year to make for future investment, and suggest how often to examine the financial position of a business.

Allowances and tax rates for directors of limited companies

Directors who wish to handle most of the accounting work on their own will generally benefit from having an experienced accountant on their payroll as an external resource who is not just able to help when their skills are needed and can assist the business in establishing efficient ways to stay in control of their finances by themselves.

10. Profits boosting

The business's finances require regular maintenance and tweaking to reduce losses and increase profits. A professional accountant will conduct regular reviews regarding the fiscal health a business and identify any current or potential problems and then taking steps to rectify and avoid them. For instance in the event of numerous business debts, they could be combined to save significant sums of money.

However, it could be beneficial to shift profits to tax-efficient investment vehicles instead of using them to pay off interest-free loan. Accountants can spot the many pitfalls and opportunities and make sure that profits are maximized overall.


In the end, the significance for having an accountant for limited company cannot be overemphasized. From ensuring compliance with complicated tax regulations to offering expert financial advice accountants play a crucial role in the growth and longevity of a company. Their expertise extends beyond just number crunching. They function as financial navigators, assisting companies navigate the complex world in financial planning.

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