Accountants for Professional Services Firms

Time spent on unbilled work at the year end usually represents income earned, especially where there is a contractual right to bill. Valuing it consistently, at the right recoverable amount, affects profit and Corporation Tax. For FRS 102 reporters, periods beginning on or after 1 January 2026 apply the revised revenue requirements, which focus on contractual performance obligations.

Contingent or success fees are generally recognised only when the condition is met or the outcome is sufficiently certain. We review engagement letters rather than relying on invoice dates alone.

Many professional practices trade as LLPs, where members are generally taxed personally on their profit share through Self Assessment, while a company pays Corporation Tax and directors draw a salary and dividends. Each structure has different filing, National Insurance and profit-extraction consequences. We prepare LLP accounts and members' returns as well as company accounts.

Professional indemnity insurance, regulatory practising certificates, professional subscriptions on HMRC's approved list, CPD that maintains existing skills and specialist software are commonly allowable. Training for a new profession, client entertaining and personal costs follow different rules.

Most professional fees are standard-rated. Expenses such as travel re-invoiced to clients are usually part of the fee and subject to VAT, unlike genuine disbursements such as some statutory fees paid as the client's agent. Advice supplied to overseas businesses is usually outside the scope of UK VAT under the general rule. The Flat Rate Scheme rarely suits firms with low goods spend because of the limited cost trader rate.

A professional services company files statutory accounts at Companies House, normally nine months after its accounting reference date, and a CT600 within 12 months of the end of its Corporation Tax accounting period. Most smaller companies pay Corporation Tax nine months and one day after the period ends; the main rate is 25%, with the 19% small profits rate up to £50,000 and marginal relief between £50,000 and £250,000.

VAT registration is required once taxable turnover passes £90,000 in a rolling 12 months, or is expected to within 30 days. Paying any salary, including to a director, brings PAYE and Real Time Information reporting, and employing eligible staff brings automatic-enrolment pension duties. The confirmation statement is a separate annual filing.

Thresholds, rates and deadlines reflect the 2026/27 UK position at the content update date. Check current GOV.UK guidance, or ask us, before relying on them for your own company.

We start with a free consultation to understand how you invoice, buy, pay people and get paid. You then receive a written scope and fee before chargeable work begins, covering bookkeeping, VAT, payroll, year-end accounts, CT600 and director Self Assessment as agreed.

Advisory work such as management accounts, cash-flow forecasting, pre-year-end planning or specialist reliefs is quoted separately rather than assumed to be included. Where a question needs specialist legal or tax advice outside our scope, we say so.