Choosing an accountant
Do contractors need a specialist accountant?
By Pick My Accountant Editorial · Updated 8 July 2026
What makes contracting different
A contractor's tax position swings on employment-status rules rather than turnover: whether each engagement falls inside or outside IR35 changes take-home pay by thousands. Add the personal service company itself — payroll for one, quarterly VAT (often flat-rate), dividends, and a director's return — and the compliance stack is heavier than for a similar-sized 'normal' business.
What a specialist actually adds
Contract and working-practice reviews before you sign, calculators comparing PSC vs umbrella take-home on real numbers, correct handling of the off-payroll rules when an end-client makes the determination, and awareness of traps like the Managed Service Company legislation and s455 loans. Generalist firms can do PSC compliance; the difference shows when a status question or an HMRC letter arrives.
Choosing between specialist firms
The market is competitive — compare what's included (insurance-backed IR35 defence? unlimited status reviews? switching support between PSC and umbrella?), response times during contract negotiations when you need same-day answers, and exit terms. Ask how they'd advise you on a mixed year of inside and outside engagements; the quality of that answer is the interview.
People also ask
What is IR35 in one paragraph?
IR35 (the intermediaries legislation) asks whether, ignoring your company, you'd be an employee of the client. If yes ('inside'), income is taxed like employment. Since 2021 medium/large clients make this determination for you; for small clients, your company decides and carries the risk.
PSC or umbrella — which is better?
Outside-IR35 contracts favour a PSC; inside-IR35 contracts usually make an umbrella simpler since PAYE applies anyway. Many contractors run both across a year — a specialist accountant helps you switch cleanly.
How much do contractor accountants charge?
Typically £83–£155 per month for a full PSC package on our benchmarks, including the director's self assessment. Umbrella employment replaces the accountant fee with an umbrella margin of £15–£30 per week.
This article is general information for UK businesses, not tax, legal, or financial advice, and thresholds change — confirm current rules on GOV.UK or with a qualified accountant before acting. Fee figures are indicative benchmarks from ourmethodology.