I am an accountancy student (AAT qualified) and I wish to start my own bookkeeping business for sole traders and partnerships. What should my first steps be and are there any rules/laws that may restrict the work I take on? Also, how do I calculate how much to charge?

I’m not sure what you mean by an “accountancy student”. The AAT might have restrictions on students offering services to the public so you should check that with the AAT, if you mean that you are not fully AAT qualified.

A look at the AAT website reveals that its members offering services to the public must be registered or licensed in one or more of three areas – Accountancy (including book-keeping and accounts preparation), Taxation and Consultancy. So you must be registered with the AAT as a Member in Practice. You will need to comply with the Continuing Professional Development requirements and the AAT monitoring regime. In addition you will be required to have professional indemnity insurance.

You should research the market for bookkeeping services in your area. Look at adverts in the local newspapers and in the recruitment agencies to find out what the going rate is. Try calling a few accountants and find out if they have any vacancies and what rate they are prepared to pay.

Wages normally account for approximately 40% of the charge so if the going rate for employing a bookkeeper is £15,000 pa, this would suggest a charging rate of approximately £25 per hour (£15,000/0.40= £37,500 for 48 weeks (4 weeks holidays) at 37.5 hours per week = 1800 hours at 80% (for non-productive time) = 1,440 productive hours. You need to be satisfied that your charging rate will earn you the income you require after expenses – computer, software, etc. Are you thinking of working from home or working at clients premises?

Once you decide how much to charge you need to work out how you will attract customers. Are is no easy way of doing this – it requires hard work through advertising, recommendation, leaflet drops, etc. Attending local business events (such as Chamber of Commerce) may yield potential customers.

It is always worth contacting local accountants to see if they have any work they can pass on. If you have any particular skill or experience (such as being familiar with Sage accounting or accounts preparation software) make sure you include it in advertising or in conversations regarding potential work. Once you have clients with a good experience of your work you will find referrals and recommendations come more easily.