Accountants for UK Agencies, Consultants and Freelancers
NDCA is an accountant for agencies and consultants UK firms use for retainer billing, recharges and contractor payments. Agencies and consulting firms bill for time, not stock, which makes the accounting different from most small businesses. Retainers need recognising in the right month, contractor and freelancer payments need handling correctly, and client recharges need tracking so nothing gets missed on an invoice. NDCA works with UK agencies, consultancies and freelancers to keep the books accurate and the cash position clear, so you can focus on client work.
Agencies and consultancies do not run on steady monthly income. A retainer renews, a project closes, a client pays late, a new contract starts mid-month. Your accountant needs to keep up with that rhythm, not force your business into a shape that suits their software.
Contact us today for a free consultation to walk through your situation.
The accounting problems that catch agencies and consultancies out
Most agency owners and consultants set up the business to do the client work, not to think about revenue recognition. But the way retainer income is booked, the way client recharges are tracked, and the way contractor payments are documented for IR35, none of it works the same as a normal trading business. Get it wrong and it turns up at the worst possible time: in a cash flow squeeze, in front of HMRC, or when a client query reveals nobody actually knows the project margin. We get it right from the start.
Retainer income booked on the wrong day
A retainer paid upfront is not three months of income on day one. It is recognised across the period the work covers, with the unearned balance held back. Get this wrong and your management accounts show a spike that has nothing to do with how much work you actually delivered.
Client recharges mixed in with fee income
Travel, software, stock photography, third-party subcontractors — costs you pass straight through to a client are not revenue. Lump them in with fees and your margin looks better than it is, which makes it much harder to price the next project correctly.
Contractor payments without an IR35 check
Agencies lean on a flexible bench of freelancers and associates. Each one needs a status determination before you pay them. Get the employment status wrong and HMRC can reclassify the relationship, leaving you liable for tax and NIC that should have been deducted at source.
No real picture of utilisation or margin
Turnover tells you almost nothing about whether a project made money. You need chargeable hours, project-level margin and a clear read on which clients and which types of work are actually profitable — numbers most accountants never produce.
What can an agency or consultancy claim as an allowable expense?
Allowable expenses for an agency or consultancy cover most operating costs, provided they are wholly and exclusively for the trade. Common claims include:
Tools, software and subscriptions
- Project management and time-tracking tools (Asana, Monday, Harvest, Float)
- Design and creative software (Adobe Creative Cloud, Figma, Canva Pro)
- Invoicing, proposal and client-management software
- Domain names, hosting and licences for client or company websites
Team and contractor costs
- Salaries, employer NIC and pension contributions for employees
- Payments to freelance contractors and associates (subject to IR35 checks for off-payroll workers)
- Remote-working equipment provided to staff (laptops, monitors, home office kit)
- Recruitment fees for hiring staff and associates
Office, travel and client costs
- Office or studio rent, utilities and business rates
- Travel to client sites, pitches and industry events
- Professional fees: accountancy, legal, company secretarial
- Business insurance, including professional indemnity cover
Who we work with
NDCA agency and consultancy clients fall into a few groups:
- Marketing, creative and digital agencies
- Management and strategy consultancies
- Freelance consultants and sole-trader advisors
- PR and communications agencies
- Recruitment and HR consultancies
- Architecture and built-environment consultancies
- Multi-partner consulting practices
- Solo consultants scaling into a small team
Not on the list? Send us a message and we will tell you honestly whether we are a good fit.
How NDCA works
Three things make our service different for agencies and consultancies specifically.
Fixed monthly fee
You pay one price every month for everything we agreed at the start — bookkeeping, retainer and project income tracking, VAT, payroll, year-end. No clock-watching, no per-question charges.
A real human, fast
You get a named accountant who understands retainer billing and project margins. Most questions get a reply within one working day, which matters when a client query lands the same week as a VAT deadline.
Built around how client work actually moves
Agency income does not arrive in steady amounts. A retainer renews, a project closes early, a client pays late, a new contract starts mid-month. We build the workflow to handle that rhythm, not to be surprised by it.
Xero is the only platform we use
Xero is the only bookkeeping platform we run. For agencies and consultancies, that matters.
Time-tracking and invoicing tools such as Harvest, Float or FreeAgent feed into Xero through structured monthly journals — retainer income, disbursements and client recharges all coded correctly. Multi-currency invoicing for international clients is handled automatically. VAT is calculated and submitted directly to HMRC under MTD. Bank feeds reconcile against actual deposits. You see the same numbers every month — not whatever your project tracker happens to show on the day. If you are not yet on Xero, we migrate you across as part of onboarding. If you are already there, we plug straight in.
Apron for invoice capture
Agencies and consultancies still generate paperwork — software subscriptions, freelancer and contractor invoices, co-working memberships, travel costs and client-event spend, most of it scattered across a handful of different cards.
We use Apron to capture all of it. Forward an invoice from a software supplier, a freelance contractor or your landlord to your dedicated Apron email address, or snap a photo, and the supplier, date, amount, VAT and line items are pulled out automatically and pushed into Xero — coded to the right cost line and matched to the bank transaction. By the time year-end arrives, every cost is documented and every allowable expense is claimed.
Retainer income and contractor payments keeping you up at night?
Agency accounting has its own traps — retainer income that does not match invoices, contractor payments that blur the IR35 line, client recharges missed at year-end. Send us your situation and we will come back within one working day with a fixed monthly quote.
Reviews
Discover why businesses trust us for dependable accounting services and practical financial advice.
Switching from another accountant
If you already have an accountant and the reporting cannot keep up with your retainers and contractor payments, switching is simpler than people think. We send your current accountant a professional clearance letter, collect your records, and pick up where they left off. Most agencies and consultancies are fully on-boarded within two weeks.
You do not need to wait for year-end. You do not need an awkward call with your old accountant. We handle the switch, including the handover paperwork, so your invoicing and client work carry on without a gap.
Accountant for agencies and consultants UK: FAQs
From 6 April 2026, dividend tax went up across every band: 10.75% at basic rate, 35.75% at higher rate, and 39.35% at additional rate. The £500 dividend allowance is unchanged, and the personal allowance stays frozen at £12,570 until 2031. In practice, that's an extra £20–£30 of tax for every £1,000 of dividends drawn — worth factoring into your salary/dividend split for the year ahead.
IR35 (the off-payroll working rules) decides whether someone working through their own limited company — a personal service company, or PSC — should be taxed as an employee for that engagement. Who makes the call depends on the size of your client: medium and large clients (turnover above £15m, balance sheet above £7.5m, or 50+ employees) determine your status themselves; small clients leave the determination to you.
Once profit reaches roughly £30,000–£50,000, a limited company usually comes out ahead. Corporation tax sits at 19–25%, and with a sensible salary/dividend split that typically beats paying income tax at up to 45% as a sole trader. The April 2026 dividend tax rise narrows that gap slightly, but for most consultants past that profit threshold, incorporating still wins.
It depends on your situation, but the common benchmarks are £12,570 (the full personal allowance), £9,100 (the secondary NI threshold — protects your State Pension record without triggering employer NI), or £5,000 for sole directors not registered as employers. We run the numbers each year against current thresholds before recommending a figure.
Yes — employer pension contributions are normally a deductible business expense and don't create an income tax or NI charge for you personally. As dividend tax rates climb, this is one of the more efficient ways to take money out of the company, particularly once you're near the higher-rate threshold.
The usual list: laptops and equipment, software subscriptions, the business share of your phone bill, home office costs, travel and mileage, accommodation when working away, professional membership fees, indemnity insurance, training and CPD, marketing and networking costs, accountancy fees, and any staff you employ. Client entertaining and everyday clothing don't qualify, even if work-related.
Only if you trade as a sole trader. The threshold for gross self-employment income started at £50,000 from April 2026, drops to £30,000 from April 2027, and falls again to £20,000 from April 2028. If you operate through a limited company, MTD for Income Tax doesn't apply to you — it's an individual taxpayer rule, not a business one.
Yes. NDCA is regulated by the ACCA, the Association of Chartered Certified Accountants.
We work remote-first. Our consultant, agency and freelancer clients are spread across the UK, and since everything runs through Xero, location doesn't really factor into how we work together.
Yes — call us on 01903 968618 or book through the contact form.
Ready to hand over the spreadsheets?
Most agency and consultancy clients send us their invoices and contractor payments once a month and never think about retainer reconciliation or year-end again. Send us a few details — we will come back within one working day with a fixed monthly quote.
