Most small business owners pick an accountant the same way: a friend's recommendation, someone close to home, or the cheapest quote. Sometimes that works out. Often it means a tax return once a year, a bill you didn't expect, and advice that arrives after the deadline it was meant for.
This guide gives you a better way to choose. It covers the non-negotiable checks, the questions that separate a good accountant from an adequate one, the red flags, when a cheaper option is genuinely fine, and how AI-native firms like ours differ, honestly, including what AI shouldn't do.
What should you look for in an accountant?
Five things matter more than everything else.
- They're a registered tax agent. Only a registered tax agent can charge you to prepare and lodge tax returns, or give tax advice for a fee. Registration means they're bound by a Code of Professional Conduct, carry professional indemnity insurance and keep up their training. It takes two minutes to check (see below).
- They understand businesses like yours. A sole trader consultant, a café with 15 staff and a construction company with subcontractors need very different things. The right accountant has seen your problems before.
- They tell you what it costs before they start. A fixed price or a clear quote, with what's included and what isn't. Surprise invoices are one of the most common complaints people have about accountants.
- They talk to you before deadlines, not after. Tax planning happens before 30 June. Cash flow problems are spotted before the BAS is due. If an accountant only appears once a year, you're paying for data entry and lodgment, not advice.
- They explain things so you understand them. If you walk out of a meeting unsure what you agreed to, that's on them, not you.
Qualifications, software and location all matter less than these five.
Chartered Accountant, CPA, or registered tax agent: what's the difference?
| Title | What it means | What it tells you |
|---|---|---|
| Registered tax agent | Registered with the Tax Practitioners Board (TPB). Legally allowed to charge for tax returns and tax advice | The legal minimum for tax work. Always check this |
| Registered BAS agent | Registered with the TPB for BAS, GST, PAYG withholding and payroll reporting | Fine for bookkeeping and BAS. Can't do your income tax return |
| Chartered Accountant (CA) | Member of Chartered Accountants Australia and New Zealand | Professional body membership with its own education, ethics and ongoing training requirements |
| CPA | Member of CPA Australia | Same idea, a different professional body. CA and CPA are broadly comparable |
| "Accountant" on its own | Not a protected title | Tells you nothing by itself. Look for one of the above |
Our accountants are a mix of CAs and CPAs, and BPAG is a registered tax agent. For most small businesses, CA versus CPA shouldn't decide anything. Registration and relevant experience should.
How to check an accountant's registration
Go to the Tax Practitioners Board public register and search the person's name or the firm's name. You'll see whether they're registered, whether as a tax agent or BAS agent, and whether any sanctions apply. If you can't find them, ask why before you sign anything.
What questions should you ask an accountant before hiring them?
Ask these in the first meeting. Good accountants welcome them. The answers tell you more than any website.
About fit
- How many clients like me do you have, in my industry and at my size?
- What are the two or three issues you see most often in businesses like mine?
- Looking at my last tax return, what would you have done differently?
About who does the work
- Who will actually do my work, and who do I call when I have a question?
- What happens when that person is on leave or leaves the firm?
- How quickly do you usually reply to emails?
About price
- Do you charge fixed fees or by the hour? What's included and what costs extra?
- Will you tell me before you do anything that costs extra?
- What would a year with you cost me, all in?
About advice, not just compliance
- When would we talk about tax planning, and is that included?
- Will you tell me when my structure no longer suits me?
- How do you keep me informed about law changes that affect me?
About systems and security
- What accounting software do you prefer, and will you help me set it up properly?
- Where is my data stored, and who can see it?
- If you use AI, who checks the output before it reaches me or the ATO?
The answer to question 3 is the most revealing. A good accountant will spot at least one thing worth discussing. A great one will explain it simply and tell you what it's worth.
What are the red flags when choosing an accountant?
| Red flag | Why it matters |
|---|---|
| Can't find them on the TPB register | They may not be allowed to charge for tax work. Walk away |
| Promises a bigger refund than everyone else | Refunds come from the law and your records, not the accountant. Aggressive claims get you audited |
| No engagement letter | You don't know what you're paying for, or what they're responsible for |
| Won't give you a price upfront | Expect invoices you didn't plan for |
| Suggests claiming things you know aren't right | You carry the penalties, not them. A registered agent must not do this |
| Can't say who will do your work | Your file may be passed between juniors with nobody owning it |
| Only contact is once a year | You're paying for lodgment, not advice |
| Pushes a trust or company without explaining the cost and rules | Structures carry ongoing obligations. You need to know them before you sign |
| Answers every question with jargon | If you can't understand the advice, you can't act on it |
| Is vague about how your data is stored | Your tax file is sensitive. They should know exactly where it lives |
Watch out: Any adviser who offers a scheme that makes tax "disappear", or guarantees a result with the ATO, is a risk to you. The ATO pursues the taxpayer for the shortfall and penalties, even when the idea came from someone else.
When is a cheaper accountant (or doing it yourself) fine?
Honestly, not everyone needs a full-service firm.
| Your situation | What usually makes sense |
|---|---|
| Employee with a salary, a few deductions, no investments | Lodge yourself through myTax. It's free and the ATO pre-fills most of it |
| Employee with one rental property | A low-cost tax agent is usually fine, provided they know rental deductions and depreciation |
| Sole trader with simple income, no staff, under the GST threshold | A low-cost agent, or a bookkeeper plus an agent at tax time |
| Sole trader registered for GST with steady growth | A good bookkeeper for the BAS and an accountant for the return and planning |
| Company or trust, staff, payroll | An accountant who handles the whole group and plans ahead. This is where cheap gets expensive |
| Selling a business, restructuring, big capital gain, moving overseas | Specialist advice. The cost of getting it wrong dwarfs the fee |
The test is simple: does your situation involve decisions, or just reporting? If it's reporting, pay for efficient reporting. If decisions are involved, such as how to pay yourself, whether to buy that vehicle before 30 June, or which entity should own the next property, pay for someone who'll help you make them.
Bookkeeper, BAS agent or accountant: who do you need?
Many businesses need two of the three, and the line between them is clearer than it looks.
- A bookkeeper codes your transactions, reconciles the bank, enters bills and keeps your software current. A good one is worth every dollar.
- A registered BAS agent can also prepare and lodge your BAS, run payroll reporting and advise on GST coding.
- An accountant (registered tax agent) prepares financial statements and tax returns, gives tax and structuring advice, deals with the ATO on your behalf and plans ahead.
If you use separate people, make sure they talk to each other and use the same software file. The most common mess we inherit is a bookkeeper coding one way and an accountant journalling it back the other way every June. Our accounting and bookkeeping service puts both under one team.
How do AI-native accounting firms differ?
You'll see more firms describing themselves as AI-powered. Some mean a chatbot on their website. Here's what it means at BPAG, and where the limits are.
What AI does well in an accounting firm
- Drafting. First drafts of BAS workpapers, tax research notes, client letters, Division 7A calculations, trust resolutions, document request lists.
- Checking. Catching GST coding errors before a BAS goes in, flagging movements in the numbers that need a question, comparing two versions of a contract.
- Not losing things. Turning meetings and calls into file notes so nothing said is forgotten, and keeping the whole client file visible to the team so work doesn't stop when one person is away.
- Speed on routine work, which frees accountants' time for the conversations that actually need a person.
BPAG works exclusively on Nagaris, a practice platform built for Australian accounting firms. Its specialist AI agents cover tax, super, state taxes, BAS, employment and client letters. For example, our BAS pre-lodgement check agent looks for GST coding and label errors before your BAS is lodged, and our management report agent turns your Xero numbers into ratios, trends and actions. Your accountant reviews both.
What AI should never do
AI output is a starting point for a qualified accountant's review, never a substitute for it. Every piece of advice from us is reviewed and signed off by a qualified accountant, and every change and every email waits for a person's approval before it goes anywhere. AI models can sound confident and still be wrong, particularly on recent law changes, state-specific rules and anything that turns on your exact facts.
If you're comparing firms that use AI, ask:
- Who reviews AI output before it reaches me or the ATO?
- Is my data stored in Australia? (Ours is held on AWS servers in Sydney, on a platform certified to ISO 27001.)
- Is there an audit trail of who did what, and when?
- What happens if the AI gets it wrong?
A firm that can't answer those clearly is using AI in a way you should worry about.
What you'd notice as a client
Mostly, less friction. Questions arrive by SMS or email and you answer on your phone, with photos if that's easier, and there's no portal password to forget. You sign documents on your phone without creating an account. ID checks run through your bank or a photo ID and selfie. If you have a family group of trusts, companies, an SMSF and personal returns, you sign one engagement for the lot. More on this on our AI-native accountants page.
How do you switch accountants?
Switching is easier than most people expect.
- Choose your new accountant and sign their engagement letter.
- Your new accountant contacts the old one for what they need: prior returns, financial statements, depreciation schedules, working papers for tax losses, and anything about open ATO matters.
- They add you to their client list with the ATO, which moves your tax agent link across.
- They give access to your accounting software, and you remove the old firm's access.
- They review your position: what's outstanding, what's overdue, and anything they'd change.
Good timing is just after a lodgment, but you don't need to wait. If you're behind on lodgments, a new accountant is often the fastest way to catch up. Our guide to overdue tax returns explains how.
Key point: Your original records, such as bank statements, invoices and contracts, are yours. If fees are owing to your old accountant, settle or agree them early so the handover isn't delayed, and give your new accountant time to request what they need well before your next due date.
Mistakes we see when people choose an accountant
- Choosing on price alone, then paying for it in missed deductions, a poor structure or penalties.
- Not reading the engagement letter, and assuming tax planning or ATO correspondence is included when it isn't.
- Staying with an accountant you've outgrown. The one who was perfect for your sole trader years may not be right for a company with 12 staff.
- Splitting the work between too many people with nobody owning the whole picture.
- Never asking a question because every phone call seems to cost money. A fixed fee that includes reasonable questions changes that.
- Keeping a structure nobody has reviewed in years. Ask your accountant to look at it, especially with the 30 June 2027 tax changes coming.
How BPAG works with small businesses
We're a registered tax agent with offices in Sydney, Melbourne, the Canberra region and Adelaide, working with clients Australia-wide. Our accountants are Chartered Accountants and CPAs. We keep books updated daily in Xero, flag issues early, write in plain English and price on a fixed basis so there are no surprises.
"I started using BPAG 3 years ago and they have been advising my business and myself in an extraordinary way. The team is also caring and they listen to what your needs are." Christian Luis Barbeitos Alvarez, Google review
What it costs is on our pricing page, and our guide to how much an accountant costs explains the pricing models you'll come across elsewhere. If you're in a trade, see how we work with tradies and construction businesses. If you want more than compliance, our fractional CFO service adds a monthly strategy meeting, cash flow forecasting and tax planning.
Start with a free strategy call. If we're not the right fit, we'll tell you.
Frequently asked questions
Is it hard to switch accountants partway through the year?
No. Your new accountant asks your old one for the files they need, adds you to their client list with the ATO, and takes over from there. You don't need to have an awkward conversation unless you want to. The best time is right after a lodgment, but any time works if your records are up to date.
Does my accountant need to be in the same city as me?
Not usually. Most accounting work now happens over email, phone and video, and your records live in cloud software you can both see. Local knowledge matters for state taxes such as payroll tax, land tax and stamp duty, so check that your accountant handles your state regularly.
Can a bookkeeper lodge my tax return?
Only a registered tax agent can charge a fee to prepare or lodge an income tax return. A registered BAS agent can prepare and lodge your BAS and handle payroll reporting, but not your income tax return. Many businesses use a bookkeeper for the day-to-day and an accountant for tax, which works well if the two talk to each other.
How often should I hear from my accountant?
At minimum, before each BAS is due, before 30 June for tax planning, and when your return is ready. If you have staff or a company, a quarterly check-in on the numbers is reasonable. If the only time you hear from your accountant is when an invoice arrives, that's a sign to look elsewhere.
Should I choose an accountant who specialises in my industry?
It helps, especially in industries with their own rules: construction (taxable payments reporting), medical (payroll tax on contractor doctors), hospitality (awards and cash), property development. Ask how many clients they have in your industry and what issues they see most often. A good answer is specific.
Are accountant fees tax deductible?
Generally, yes. The ATO says fees paid to a registered tax agent for preparing your return, tax advice and dealing with the ATO are deductible, generally in the income year you pay them. Fees for business accounting and bookkeeping are a normal business expense. Fees for setting up a structure or buying an asset can be treated differently, so ask.
Official sources
General information only, current as at 18 October 2026. It is not personal tax, legal or financial product advice and doesn't take your circumstances into account. Talk to us before you act. Where a recommendation needs a licensed financial adviser or a solicitor, we work alongside them.