Do you need an accountant for a limited company?

There is no legal requirement

Nothing in UK company law says a limited company must appoint an accountant. A director can prepare and file the annual accounts, the confirmation statement and the Corporation Tax return themselves.

What the law does require is that those filings are correct and on time. That obligation sits with the directors, and it doesn't transfer to anyone you appoint. Hiring an accountant buys you competence and time — it doesn't move the responsibility.

What a limited company must actually file

Note the fourth row. The tax is due before the return is due. That single mismatch catches more first-time directors than anything else on the list — you're expected to know what you owe three months before you have to tell HMRC what it is.

What happens if you get it wrong

Companies House late filing penalties are automatic and escalate the longer accounts are outstanding — and they double if you file late two years running. HMRC runs a separate penalty regime for late Corporation Tax returns, plus interest on tax paid late.

Persistent failure can end in the company being struck off and directors disqualified. And penalties for late filing are not deductible against your profits, so you pay them out of taxed money.

When doing it yourself genuinely works

• Low transaction volume — a few dozen a month
• Not VAT registered, or on a simple scheme
• No employees, or a single director payroll
• One bank account, no stock, no long contracts
• You're comfortable in the software and you keep on top of it monthly

Plenty of small companies run perfectly well this way for years. If that's you, an accountant once a year for the accounts and tax return is a reasonable arrangement.

When it stops working

• You register for VAT. The error rate rises sharply and the errors are expensive
• You take on employees. Payroll, pensions and RTI are unforgiving and monthly
• Volume passes roughly fifty transactions a month. Coding drifts, and drift compounds
• Sector rules apply — CIS in construction, client money in law, NHS income in dental and pharmacy
• You're making decisions on hiring, pricing or borrowing and can't answer "was last month any good?"
• You're behind. The moment you're two months behind, you're not going to catch up in an evening

The option most people miss

It's not a binary. The common middle ground is monthly bookkeeping running into the year end — someone keeps the records right as you go, so the annual filings are produced from clean data rather than reconstructed from a year of guesses.

It's usually cheaper than it sounds, because the year-end work costs far less when the books arrive in good order. The expensive version is the opposite: a year of miscoded transactions unpicked at professional rates in month eleven.

A fair test of your own books: could you hand them over tomorrow without apologising for them?

If you're weighing it up on cost, our bookkeeping prices guide sets out what UK firms actually charge, and the cost calculator works out what doing it yourself is costing in hours. If you're not sure which service you need, bookkeeper vs accountant explains the split. And if you're already behind, catch-up and cleanup is a defined, fixed-fee job.