Smarter accounting

Hand removing legal text from library shelf


It is important for advocates to remain in control of their finances and have access to current financial information.

For a fixed fee Alterledger will provide an online reporting system which will allow you to track your fee income and keep up to date business accounts.

Cloud Software

Your fee to Alterledger will include a subscription to Xero allowing real-time access to your accounts.

The traditional approach to accounting was to produce a set of annual accounts after the year end, by which time they are only of use to HMRC. If you are ever left wondering how much profit you have made during the year you should use an accounting service that is designed for your needs.

Alterledger can set you up with real-time accounts that link to your business bank account to save time and effort in working out your business costs.


It use beneficial for advocates to register for VAT.  In the early years of your practice it can help you give a more professional and established impression. If your annual turnover exceeds the VAT threshold (£85,000 from April 2017) you must register for VAT.

It is important to note that it can take a few weeks for HMRC to process an application to register for VAT. Once you have your VAT certificate you will have all your VAT registration details including the date of registration. Any fee invoices dated after the date of registration need to have VAT charged. In the event that fee invoices have been issued without your VAT registration, your client will need to be approached again and a new invoice presented including VAT.

Business Banking

As an advocate you are not obliged to have a separate bank account for your practice, but it will make your administration much easier to have a discrete account for this purpose. You don’t have to open a business account, which often comes with bank charges. Most banks will let you open a normal retail account as long as you have regular receipts over a certain monthly threshold or have at least one direct debit. By channelling all your business expenses through a distinct account you will have most of your bookkeeping function performed automatically by your bank.

Advocates often set up multiple bank accounts to keep separate pots of cash. The different accounts can be used to hold a provision for income tax, VAT and retained earnings, but keeping your accounts up to date with Xero and Alterledger you will have access to these figures without the messy process of transferring cash between accounts.

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