What Does a Limited Company Accountant Actually Do?

A limited company accountant prepares and files your annual accounts, Corporation Tax return and confirmation statement, handles VAT and payroll if needed, completes your personal Self Assessment return and advises on pay, dividends and tax planning. The best ones also keep you on top of deadlines and help you answer HMRC.

Key takeaways

• A limited company accountant covers statutory accounts, Corporation Tax, VAT, payroll and personal tax returns.
• Many also provide bookkeeping, company secretarial support and monthly management information.
• Good advice on salary, dividends and pensions often saves more than the fee.
• They can act for you with HMRC and Companies House once authorised.
• You still own the responsibility, so you need to provide accurate records on time.

The core compliance work

The foundation of the service is making sure the company meets its legal obligations. That means the following.

• Annual accounts: preparing statutory accounts in the right format and filing them at Companies House. See our guide to limited company accounts.
• Corporation Tax return: computing profits, claiming reliefs and filing the CT600 with HMRC.
• Confirmation statement: confirming your company details each year. See how to file a confirmation statement.
• Director’s personal tax return: reporting your salary, dividends and other income through Self Assessment.

Each of these has its own deadline and penalty regime, so missing any of them can be costly.

Bookkeeping and management information

Some accountants only deal with the year-end numbers, while others also look after day-to-day bookkeeping. This includes recording sales and expenses, reconciling bank accounts, chasing receipts and producing monthly or quarterly reports. If you keep the books yourself, your accountant will usually review them and fix errors before preparing the accounts.

Management information such as profit and loss reports and cash flow forecasts is useful for running the business, not just for HMRC. Our post on how to read a profit and loss account and balance sheet shows what to look for.

VAT and payroll

If your company is VAT registered, an accountant can prepare and submit VAT returns through Making Tax Digital software, advise on whether the flat rate scheme or standard accounting suits you and handle any VAT enquiries. If you pay yourself a salary or employ staff, they can run payroll, submit Real Time Information reports to HMRC and handle pension auto-enrolment where required.

Most small one-director companies use payroll for the director’s salary, even when no one else is employed. Read whether you need payroll as a one-director company to understand why.

Tax planning and advice

This is where an accountant can add the most value. They can advise on how to split your pay between salary and dividends, whether employer pension contributions make sense, how to treat a company car or home office and when to buy equipment to use capital allowances. They can also model what happens as your profit grows, for example whether it is worth changing your structure or timing dividends around 5 April.

Examples include working out the best director salary for the year or reducing your dividend tax bill. Advice like this should be based on your actual circumstances, not a generic rule.

Dealing with HMRC and Companies House

Once you authorise them, an accountant can speak to HMRC on your behalf, respond to tax enquiries, ask for penalty appeals and set up payment arrangements. They can also deal with Companies House filings such as changes of director, registered office or share structure. For directors who dislike official letters, this alone can be a relief.

Company secretarial support

Many accountants also help with the formal side of running a company, such as maintaining statutory registers, preparing board minutes and dividend vouchers, updating the register of people with significant control and advising on share issues. Our guide to adding a director or shareholder shows the sort of paperwork involved.

What an accountant does not do

An accountant is not a substitute for your own responsibility. They rely on the information you give them, so incomplete records or missing receipts lead to errors. They normally do not manage your cash or make business decisions for you, and they are not automatically a legal adviser. If you need legal advice about contracts or shareholder disputes, you will need a solicitor.

It is also worth being clear about scope. Some packages exclude VAT, payroll or Self Assessment, or charge extra for answering HMRC letters. Check what is included before you sign up. Our packages are designed to be clear, with fixed monthly fees from £45.83 + VAT, which you can see on our fees page.

What a typical year looks like

It helps to picture how the work is spread across twelve months. In the first few weeks after your year end, the accountant finalises the books and prepares the accounts. Over the following months they file the accounts with Companies House, submit the Corporation Tax return and remind you when the tax payment is due, nine months and one day after the year end. In the autumn they begin work on your personal return, and in January they confirm what you owe and by when.

Throughout the year, you may also have VAT returns every quarter, monthly payroll submissions and occasional questions about dividends, equipment purchases or HMRC letters. A good accountant treats the year as a rolling calendar, not a once-a-year rush, and schedules a tax planning check-in before the tax year ends on 5 April. That is when decisions on dividends, pensions and timing can still make a real difference to your bill.

How to get the most from your accountant

• Send records regularly, ideally monthly, not once a year.
• Tell them about changes early, such as new income, assets or staff.
• Ask for a tax planning conversation before the year end, not after.
• Keep your own deadline calendar so nothing slips through the cracks.
• Ask questions. A good accountant welcomes them.

If you are weighing up whether to hire one at all, read do I need an accountant for a limited company? and our guide to choosing one.

The bottom line

A limited company accountant handles your accounts, tax returns, VAT, payroll and deadlines, and a good one also gives advice that saves tax and time. Choose someone who specialises in limited companies, agree the scope clearly and give them the records they need on time.

Frequently asked questions

What does a limited company accountant do?

They prepare and file annual accounts, the Corporation Tax return and confirmation statement, handle VAT and payroll if needed, and complete your personal tax return.

Does an accountant do my bookkeeping?

Some do, either fully or by reviewing your records. Check whether bookkeeping is included in the package.

Can an accountant deal with HMRC for me?

Yes, once you authorise them, they can correspond with HMRC and file on your behalf.

Will an accountant save me tax?

They can, through advice on salary, dividends, pensions and allowable expenses, but they cannot guarantee a specific saving.

Who is responsible if there is a mistake?

The director remains legally responsible, though a professional accountant should have insurance and correct genuine errors.