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Does your accountant understand your sector?

You ask the average accountant what they specialise in, and once you have got over the blank expression on their face, they will tell you SMEs or family owned businesses or maybe even owner managed businesses.

And that is all very well but do they understand what you do, how it should be accounted for and what special tax problems there are?

As examples:

Caravan and Holiday Home Parks are trading businesses that HM Revenue and Customs try and classify as investment businesses. Turnover is therefore ALWAYS called “Pitch Fees”. If your accountant describes them as “Rent” – sack them now, it could cost you 18% more tax when you come to sell out!

Importers/Exporters often take deposits from customers and pay them over to suppliers before the commencement of the transaction. This means customers are technically creditors and suppliers are debtors – which is the “wrong” way round for most companies. It obviously makes perfect sense and is correct, but if you see your accountant scratching their head, then it’s time to move to a new one!

Unfortunately the above are real life examples that I have come across and I am sure others have examples as well.


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