How Much Does Your Accountant Charge?

kiitos on 19/06/2015 - 15:04

I have been using my local accountant for a number of years, and grumbling about the cost.

I have a fairly simple business - IT contractor, regular invoices, usual expenses - company registration, insurance, company car expenses, etc.

I do my own IASs and BASs except for the final BAS of the year. I calculate and pay GST each quarter so no Annual GST Return needed.

My accountant charges around $2500 for:

  • Fourth quarter BAS
  • Payment summary for me as an employee of my company
  • Company tax return
  • Company statements
  • Workers comp return

though last year it hit a new height of over $2800. And any advice he may give if I call during the year is usually billed separately on top of this. So I tend not to call! Which is a stupid approach.

I grumble about it, but when I ask others at work for recommendations, they seem not keen to recommend theirs (though often their much cheaper than mine).

What should be the final straw for me is that there have been a few slip ups with my accountant, including them neglecting to forward the latest ASIC annual return to me, and ringing me on the day it was due to say they'd pay it immediately and then do the paperwork later.

He also does our personal tax returns, but that's additional cost (around $800 ($600 me/$200 wife). I know everyone here will probably do it themselves, and I used to, and should go back to doing it ourselves again.

So, if you have similar accountancy requirements for your business:

  1. How much do you pay for accountancy for your business?
  2. How much do you pay for accountancy for your personal tax returns, or do you do it yourself? Or does the accountant "throw them in" with the business accountancy work?
  3. Do you have any advice on how to streamline my accountancy requirements to make it cheaper/easier to do? I let the accountant do some things I probably would be able to do myself, if I knew what was needed.
  4. If you're in Sydney (preferably northern shore), and you'd recommend your accountant, please do so here!
Financial

Comments

  • UncommonName on 19/06/2015 - 15:30
    1. 0$
    2. Do it myself.
    3. Others might give better advice than me on this. If you have just income/expense then its easier to DIY, but it gets complicated with property ownership/investments etc.
    4. Again, others will know better.

    How about you try to do everything (paperwork) in parallel to the accountant this year? If you deem its doable for you, you can go solo from next FY.

    • kiitos on 23/06/2015 - 23:43

      Good idea - I do all but the final books, maybe I can try the final quarter BAS and then try tackling that.

  • frysie on 19/06/2015 - 15:31
    +1

    My mrs is an accountant and she gave me some advice.

    Always change your accountant every couple of years. They get to "relaxed" and take you for the ride.

    my mrs however is not in tax, as its nearly as boring as auditing… and she always takes me for a ride ;) haha

    • hashtagbargain on 19/06/2015 - 19:08
      +10

      can confirm, she takes me for a ride too.

    • kiitos on 23/06/2015 - 23:43

      Good idea - I guess it's like insurance, it's easy to build inertia with your current accountant as "they have all my info".

  • nocure on 19/06/2015 - 15:50
    +6

    My mrs is an accountant.

    Always change your accountant every couple of years.

    Then you need a lawyer.

    • ExPrinceHairy on 19/06/2015 - 15:54
      +2

      Mrs = Accountant
      ∴ Always change your Mrs every couple of years.

      I get it. ;)

      • frysie on 19/06/2015 - 15:58

        Not when she does all my financials, shes a keeper this one ;) she works for free ;)

        good thing she doesn't like my ozbargain habits… her being an accountant we like to save every cent :|…. one day she will be on here… one day i will need to moderate my comments ahhaha

  • scotty on 19/06/2015 - 15:57

    I do my own payment summary and workers comp. Payment summary is easy if the software you use has integration. I use Xero and once I get this year's payroll sorted out, I just click a few buttons to publish the payment summary — they got sent to ATO and my employees electronically.

    Filling out the forms for workers' comp however still requires pen and envelope to post the form back. I use Allianz.

    I'll think my company tax should be pretty straightforward as well since I already do all my bookkeeping, BAS/IAS etc from Xero. However I actually paid more than you for my last tax return.

    • kiitos on 23/06/2015 - 23:45

      RE: the worker's comp - I had thought it needed to be signed off by an accountant. Maybe I should read the forms more closely. So you are able to submit the WC declaration of wages just by yourself?

      • scotty on 24/06/2015 - 08:11

        I don't think so — some small business or sole traders don't even have accountants. Definitely not required on the form.

  • Edsanwong on 19/06/2015 - 16:23
    +1

    Does the accountant give you advice about tax minimisation thingy too? or that is a financial planners job? E.g, put extra contribution for your super, split the investment property for 20% for the partner (cos she earns less) and 80% (coz you pay tax more), investment strategy etc

    • kiitos on 23/06/2015 - 23:46

      Not my one, though that's also because he charges for any lengthy queries separately. I would like a switched-on accountant that's keen to advise (mine if quite conservative, which I guess is good and safe).

  • kyttiekat on 19/06/2015 - 17:36

    Not quite a company, so a direct comparison won't be possible. But as a sole trader, my accountant does my sole trader/personal tax, + LOTS of general advice / tax minimisation strategies / ideas etc = $330. Used to do my personal tax on my own, but as soon as business was involved, it all just became too hard. :)

    I belieeeeve mine charges $700 upwards for a "small" business. I think it depends on the revenue or something.

    • toristo on 19/06/2015 - 20:57

      Mine charges $650 for my personal return plus a sole trader 4th quarter return (I do my own BAS).

    • kiitos on 23/06/2015 - 23:47

      Is your accountant in Sydney?

      • kyttiekat on 24/06/2015 - 10:24

        Yes. :) Would you like a referral? Like I said I can only speak from what he charges me as a sole trader, but so far I've found him very knowledgeable eg send him a question via email and I get an awesome essay in response. :)

        • kiitos on 17/07/2015 - 17:07

          Thanks for the offer - I've sent a private message to you.

  • Janko on 19/06/2015 - 19:11

    Now do both company and personal tax myself - got sick of accountants making mistakes and charging big bucks. I can't recommend one, sorry. If anyone's half decent, people won't leave them and they won't have room for more clients.

  • Bonsaichop on 19/06/2015 - 21:46

    Just FYI for those doing Workers' comp all the insurance companies that provide WC in NSW are all actually agents for NSW Work Cover. As such the premiums are the same all round as are the cost of claims as they all work off the same formula. Setting up WC is easy enough if you're an employer, it's a couple of pages of details and even easier if you have not lodged any claims. (Used to work as an analyst for one of the agents a few years ago).

    I have an online eBay business that sells vintage computers, video games, music, electronics, etc. No employees (except the dog). Most of my data is compiled into a 12-tab excel sheet that is derived from data pulled from eBay and PayPal. Takes about 3 hrs every quarter to do. The accountant charges me $220 to go through it and make sure my numbers are right and lodge it. I pay $150 at the end of the year to do my personal tax. I can call them any time during the year, though most of the time I email them (once every month or two) if I need any advice or if I'm going to make a large spend and they don't charge me either.

    I learnt the hard way that its better to get an accountant to check everything for you. When I first started I applied for an ABN, was rejected as they thought it was a hobby. Did my tax myself and thought I was doing it right, then a few years later I was audited the ATO then considered my hobby to be a business and said I needed an ABN!?!?. Ugh. That was a stressful and costly year!

  • AMLagonda on 20/06/2015 - 01:15

    I get charged $880 for just getting my (yearly) Tax done, I have a small Business.

    Am I paying too much?

  • aocal on 20/06/2015 - 09:20

    My accountant changes similar to yours for similar work. Does always seems a lot!

    • kiitos on 23/06/2015 - 23:48

      Are you replying to me, or AMLagonda?

  • Ozziejack on 20/06/2015 - 09:30

    I had been using the same accountant for years and the bill kept on creeping up. I have retired and the amount amount of work required has been going down, down, down. At its peak I had rental properties and major varieties of tax deductions but now it is very little. My account for last year was the highest I had ever had. I enquired of a couple of local accountants to do the work and their quote was less than a quarter of what my accountant's bill was. They also said that accountants rarely lower their bills unless pressed. So I complained and I was told that my bill was an error and the correct bill was about a third of the original. Hmmmmm… makes you wonder doesn't it. It's sort of like they take their established customers for granted.

    • kiitos on 23/06/2015 - 23:49

      Looks like I'll have to do the same. Thanks for the reply.

  • ramshead on 20/06/2015 - 10:10

    My accounted charges less than $500 for doing the returns for both my wife and myself. We are both PAYE employees. We have one investment property and some dividend paying shares. I'm in his office for less than an hour. All my records are on spreadsheets with matching receipts (where required).
    I've been with him for a while and I suppose he charges me that rate because all he has do is transfer the info to his proforma. But I'm not in Sydney and your present accountant might be trying to get together a deposit for a house.

  • Noblejoker on 20/06/2015 - 11:25

    An accountant should be a business and tax adviser
    A bookkeeper does the paperwork
    Sounds like you are paying accountant prices for bookkeeper services

    This goes against Ozbargain law but - with professional services I believe that quality is more important than price
    Sounds to me like you are not satisfied with the service you are getting - and thus you think it's dear
    If you are getting great advice/service that saves you tax $$ you wouldn't be questioning the price

    Price and value are not the same thing - you aren't getting value
    I suggest shopping around for an accountant you can build a relationship with and feel you get value from
    For anything small biz related I love the website flyingsolo.com.au
    go to the forums there and ask for recommendation for an adviser in your area

    • kiitos on 23/06/2015 - 23:52

      Yes, you've nailed it. If he was proactive, and actively advising me, or even sending out newsletters with tips or new tax laws or something, I'd feel I'd be getting some decent value.

      That's why I looked at small businesses when I changed to this one - thinking it would be a more personable relationship.

      Will check out flyingsolo - thanks for that.

    • cpho on 24/06/2015 - 00:43

      with professional services I believe that quality is more important than price

      I agree. You think an accountant is expensive? Try going without one…

  • SlickMick on 20/06/2015 - 13:07

    I don't have a business, but do own tax returns (despite complicated), but let esuperfund look after SMSF. I hate letting someone else do it - I don't trust that they'll get everything right.
    So I'd struggle giving over to an accountant or financial planner or any kind of adviser. (Yeah, I clearly have issues.) I reckon all info is available to all these days, and I'd still put just as much time into checking that they didn't miss anything, so might as well not throw money away.

    If someone recommended someone I could trust, and easy to discuss all the investments I have etc, all mixed up with my wife, and wouldn't charge too much, I'd love to hand it over. But I don't see it happening.

  • Sweetnsour on 20/06/2015 - 19:57
    +1

    Try to do as much as pre-work adding/totalling amounts and pre-organise on excel. The accountant can help with what format they prefer. Accountants charge depending on how much time is required to process your tax return much like a tradesman.

    I pay $660 + $330 company return. It may be more than others but I like how i email a question to him and can meet him if needed. There is no extra cost. I sometimes seek advice from a tax perspective for property and trust accounts etc.

    Looking from my own perspective, i could probably do myself, but I value my days off to do anything but tax admin 😂

    • kiitos on 23/06/2015 - 23:56

      Yeah, I do that, with a spreadsheet laid out along his guidelines. The alternative was to get MYOB, but that seemed an unnecessary cost and quite clunky. Would you recommend accountant?

      • Sweetnsour on 24/06/2015 - 08:32

        He is southside of the harbour though

  • kiitos on 23/06/2015 - 23:42

    Thanks everyone! I do do quite a lot of the bookkeeping myself, in Excel, and give the accountant a set of spreadsheets for income and expenses. Even if he's charging $250 ph that's over 10 hours of work for what should be fairly routine number crunching (and done by a junior).

    My previous accountant expanded quite quickly and lost the personal touch. I did shop around and found quotes that were about 1/3 less than my previous accountant's charges. I went with a middling one, that is near my home, and seemed a small businessman. But the first invoice from him was magically around the same price that my previous accountant was charging. He had requested a trial balance from the previous accountant, and I guess the previous charges "rubbed off" on him! I queried him on it, and he said it was setting up a new client, etc, etc. I'm not very assertive, so I let it slide…and slide…

    Time to shake things up (him and myself!) again!

  • Chrotzo on 24/06/2015 - 19:18
    +1

    if price is your priority you could probably try H&R block, I am a tax accountant and have done some clients who moved from H&R block, when i looked at their invoice I wonder how can they charge that cheap, not sure how good they are though.

    Just would like to mention that although your business seems simple, it might not always be the case (e.g. if you use company car for private purpose we need to think about FBT, if you withdraw too much money from your company then Div7A might apply etc) i am not justifying the expensive accountant fee because i don't know the amount of work involved but just saying sometimes it is not as simple as you think and also how good you are with you bookkeeping makes a lot of difference. Although $2800+800 seems pretty expensive. I would say $1500-2000 with free advice/consultation is reasonable.

    • accountant4Jesus on 25/06/2015 - 08:18

      I'm an accountant as well, and every single H&R Block tax return I've seen from people who later came to us was riddled with basic errors and failing to claim deductions that were available to claim. I would not recommend them.

      • Chrotzo on 25/06/2015 - 10:58

        Why neg? Of course i would recommend myself instead of h&r block if you are after quality, but i said if price was his priority then h&r block is one of the cheapest i know. i did say i dont know how good they are and for a simple tax return i m sure they are good enough.

        • accountant4Jesus on 25/06/2015 - 13:29

          I know of accounting firms (including the one I work for) that are able to do simple tax returns for around the same price as H&R Block and most generally take up all available deductions. Yes H&R Block may be the cheapest fee-wise, but if they're not claiming deductions you're entitled to claim, the true cost of getting them to do your tax is the fee plus the tax you didn't save from deductions that weren't claimed. So in essence some people that go to H&R Block are losing out because they're only focusing on the savings on the fee side of things, when they should be including the tax savings in their deliberations as well.
          I'm not having a go at you, by the way. I wanted to make sure you knew that. I'm just sharing my experience with people coming from H&R Block to my firm.

  • Tim183 on 19/08/2017 - 16:52

    Speaking as a Chartered Accountant and Chartered Tax Advisor myself, a good accountant is a personal advisor who will offer you a lot more than pumping out pro-forma financial statements, tax returns and associated documents.

    The real value lies in the broad experience we offer in tax minimisation, asset protection and cashflow forecasting.
    We have usually, quite literally, seen it all before.

    Many poor accountants take the seemingly quick and easy money in basic compliance work. They take on too many compliance-based clients, this means clients with more complex needs are neglected and more profitable value-added services are missed.

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