Many business owners stay with an accountant they are unhappy with because changing feels complicated, or because they think they have to wait until the year end. In practice, changing accountants in the UK follows a standard process, your new accountant does most of the work and you can move at any point in the year. This guide covers the signs it is time to change, how the handover works and what to check before you choose someone new.
- Signs it is time to change accountants
- When to change, including mid-year
- How changing accountants works, step by step
- What your new accountant needs from you
- Dealing with your old accountant
- How to choose your next accountant
- Frequently asked questions
Signs it is time to change accountants
Most people change accountants for a handful of reasons:
- Slow replies. Emails take a week to answer, or you never speak to the same person twice.
- Surprise bills. You are charged extra for every phone call, question or form, and the annual cost keeps creeping up.
- No advice. Your accountant files your returns but never tells you how to pay less tax, how to take money out of your company or what is coming up.
- Late filings and penalties. Deadlines are missed or left to the last week, and you find out about a penalty from HMRC rather than from your accountant.
- Tax bills you did not see coming. You learn what you owe a few weeks before the payment date, with no time to plan.
- Outdated systems. You still post paper records or send spreadsheets once a year, with no cloud software or regular figures.
- You have outgrown them. Your business now has staff, VAT, several income streams or bigger decisions, and your accountant is not set up for that level of work.
If two or more of these sound familiar, it is worth speaking to another firm.
When to change, including mid-year
You do not have to wait for your year end. You can switch at any point in the year. Your new accountant simply picks up from where your old accountant left off, whether that is a VAT quarter, a payroll month or a set of accounts that has not yet been started.
There are some practical points on timing. If a filing deadline is very close, it often makes sense for your current accountant to finish that one return while the handover happens. If your old accountant has not started your year end accounts, moving before they start avoids paying for work twice. Your new accountant should look at your deadlines and agree the cleanest point to take over.
How changing accountants works, step by step
The process is much the same at most firms:
- Initial conversation. You explain your business, what you need and what has gone wrong. The new accountant confirms the services and the fee before anything starts.
- Engagement letter. You sign a letter setting out what the new firm will do for you and what you will provide.
- Identity checks. Accountants are required by anti money laundering law to verify the identity of new clients and the people who own or control a business. You will usually be asked for photo ID and proof of address.
- Professional clearance. Your new accountant writes to your old accountant to ask whether there is any professional reason not to take you on and to request the information needed to continue the work. ACCA members and other regulated accountants follow this step as part of their professional rules.
- HMRC and Companies House authority. Your new accountant asks HMRC for authority to act on your taxes, which you approve, and you share your Companies House authentication code so filings can be made for your company.
- Software access. You give your new accountant access to your accounting software, or they set you up on cloud software if you do not use it yet.
- Handover complete. Your new accountant reviews the records, confirms the upcoming deadlines and takes over the work.
How long it takes depends mainly on how quickly your previous accountant sends the records across, and a good firm keeps you updated throughout.
What your new accountant needs from you
Having these ready speeds things up:
- Your last set of annual accounts and corporation tax return, if you have a limited company.
- Your last Self Assessment tax return.
- Your Unique Taxpayer Reference, company number and Companies House authentication code.
- Your VAT number and recent VAT returns, if you are VAT registered.
- Your PAYE reference, payroll records and pension scheme details, if you have staff.
- Login details or user access for your accounting software.
- Any letters from HMRC you have not dealt with.
Dealing with your old accountant
You do not need to have a difficult conversation. A short email saying you are moving to a new firm, and asking them to respond to the professional clearance letter when it arrives, is enough. Check your engagement letter for any notice period and settle any fees you genuinely owe, because outstanding invoices can slow the handover.
Your old accountant should pass on the information your new accountant needs to continue the work, such as prior year figures and balances. They are not required to hand over their own working papers. Ask for copies of anything you supplied to them, such as bank statements, invoices and receipts, if you do not already hold them.
If your bookkeeping has fallen behind, that does not stop you moving. A new accountant can bring the records up to date as part of the switch, and our bookkeeping catch-up service exists for exactly that situation.
How to choose your next accountant
The cheapest firm is rarely the one that saves you most. Before you sign, ask:
- Is the firm regulated by a professional body such as ACCA or ICAEW?
- Will I have a named accountant who knows my business?
- How quickly do you reply to emails and calls?
- Is your fee fixed and what exactly does it include, for example advice, calls and HMRC letters?
- Do you work with businesses like mine, in my industry and at my size?
- Will you give me figures during the year, not just at the year end?
- Which accounting software do you use and will you help me set it up?
A firm that answers these clearly, and tells you how they will handle your next deadline, is a good sign. You can read more about switching accountants to NDCA, including what to expect from us in the first few months.
Thinking about changing accountants?
NDCA is an ACCA-regulated accountancy practice with fixed monthly fees and a named accountant. Book a free consultation and pick a time that suits you.
Frequently asked questions
Can I change accountants in the middle of the year?
Yes. Your new accountant takes over from where your old accountant left off and agrees the best handover point based on your upcoming deadlines.
Do I need to tell my old accountant I am leaving?
A short email is enough. Your new accountant will also contact them directly with a professional clearance letter asking for the information needed to continue your work.
What is a professional clearance letter?
It is the letter in which your new accountant asks the old one to confirm there is no reason not to act for you, and requests the handover information. Regulated accountants send one as standard.
Will changing accountants cause problems with HMRC?
No. HMRC simply records that a new agent is acting for you once you approve the authority request. Your tax records and deadlines stay the same.
Does my new accountant need permission from my old accountant?
No. You choose who acts for you. The professional clearance letter is a standard check between regulated accountants and a request for information, not a request for permission.
How long does it take to change accountants?
Usually a few weeks, driven mainly by how fast your previous accountant hands over the records. Your new accountant should keep you updated throughout and make sure no deadlines are missed during the handover.
