Do I need an accountant for a limited company?
There’s no law that says a limited company must have an accountant. You could, in theory, file your own Companies House accounts and Corporation Tax return yourself. Almost nobody actually does this successfully once the business is doing anything real, and it’s worth understanding why before you decide to try.
What an accountant is actually doing for you
It’s not just typing numbers into a form. A competent accountant makes sure you’re claiming the expenses you’re entitled to, structures your salary and dividends efficiently, keeps you on the right side of Companies House and HMRC deadlines (which carry real penalties if missed), and flags problems, like an approaching VAT threshold, before they become expensive surprises.
What it typically costs
For a small limited company, expect somewhere in the range of £600 to £1,500 a year for basic annual accounts and Corporation Tax filing, more if you want monthly bookkeeping, payroll, or VAT handled as part of the package. Compare that to the interest and penalties for a late or wrong filing, and it’s rarely the expensive option it first looks like.
Can software replace an accountant?
Good accounting software, and there are genuinely free options like Wave, makes bookkeeping far easier and can handle a lot of the day to day recording. It doesn’t replace the judgement calls an accountant makes on tax efficiency, or the accountability of someone actually signing off your figures. Most people use both together rather than choosing one over the other.
The honest bottom line
If your company is genuinely dormant with no activity, you might get away without one for a year. The moment there’s real trading, real payroll, real dividends, get an accountant. It’s one of the few costs in running a limited company that reliably pays for itself.