Does my accountant need access to my bank account?

No, your accountant should never need your personal bank login details, PIN, or password. You should never share these with anyone. Giving out this information is a major security risk, could lead to fraud, and likely breaks the terms and conditions of your bank account.

While they don’t need access to log in, they do need to see your bank transactions to do their job correctly.

Why do they need to see my transactions?

Your accountant uses your bank transaction data to:

• Do your bookkeeping: This means recording all your business income and expenses.
• Perform bank reconciliation: This is the process of matching the transactions in your accounting software to your bank statements to ensure nothing has been missed or recorded incorrectly.
• Prepare your accounts: This includes your annual profit and loss statement and balance sheet.
• Calculate your tax: They need to see exactly what you’ve earned and what you’ve spent on allowable business expenses to work out your Corporation Tax, Income Tax, and VAT.
• File your VAT returns: If you are VAT registered, they must review all transactions to ensure the correct VAT is claimed and paid to HMRC.

What are the secure ways to give them this information?

There are two main, secure methods used by almost all accountants in the UK:

1. Bank Feeds (The Best Method) This is the modern standard. You use accounting software (like Xero, QuickBooks, FreeAgent, or Sage) and connect your bank account to it through a secure, official link.
   • How it works: This connection uses an “API” (a secure data link) approved by your bank. It automatically ‘feeds’ a read-only list of your transactions into the software each day.
   • Is it safe? Yes. Your accountant gets a login to the accounting software, not your bank. They can see the transactions but cannot move any money, make payments, or see your login details.
   • The benefit: It’s fast, accurate, and saves a huge amount of time, which can lower your accountancy fees.
2. Bank Statements (The Manual Method) This is the more traditional way. You log in to your own online banking and download your bank statements for the period your accountant needs (e.g., the full tax year).
   • How it works: You send these files (usually PDFs or, even better, CSV/Excel files) to your accountant via email or a secure portal.
   • Is it safe? Yes, as long as you send them securely. However, it creates a lot of manual data entry for your accountant, which can be less accurate (due to human error) and may cost you more in fees.

In summary, your accountant needs to see your bank data, but they must never be given the keys to your bank account. The best way is always a secure bank feed via accounting software.