Accountant vs bookkeeper: what each does and which your business needs
A bookkeeper records and reconciles what happened. An accountant turns those records into financial statements, tax returns and advice. Most growing businesses need both, and many get both from one firm.
In short
- A bookkeeper captures transactions, reconciles the bank and keeps the books current. An accountant prepares financial statements and tax returns and advises on what the numbers mean.
- If your books are late or messy, start with a bookkeeper. If your books are fine but you do not know what to do with them, you need an accountant.
- A tax practitioner is the person registered with SARS to advise on tax and complete returns for others. Your accountant may be one.
- Above a certain size, a third role appears: the CFO or virtual FD, who plans rather than records.
The short answer
A bookkeeper looks backwards at the day-to-day: what came in, what went out and whether the bank agrees. An accountant looks across and forwards: what the year-end statements say, what you owe SARS, and what to do next. They overlap, and a good bookkeeper often does work that looks like accounting. The difference is in who signs off, who is accountable to SARS and who advises.
What a bookkeeper does
- Captures sales, purchases, payments and receipts, with source documents. See recording accounting transactions.
- Reconciles the bank, debtors and creditors every month.
- Processes payroll and prepares the figures for VAT and EMP201.
- Produces a monthly set of management accounts.
What an accountant does
- Reviews the books and prepares annual financial statements.
- Prepares and submits tax returns: VAT, provisional tax and income tax.
- Advises on structure, remuneration, and tax regime. See turnover tax vs normal tax.
- Deals with SARS correspondence, verifications and disputes.
Side by side
| Task | Bookkeeper | Accountant |
|---|---|---|
| Capture and categorise transactions | Does | Reviews |
| Bank and ledger reconciliations | Does | Reviews |
| Payroll processing | Often does | Reviews, advises on compliance |
| VAT201 preparation | Often prepares | Reviews and submits |
| Monthly management accounts | Prepares | Reviews and explains |
| Annual financial statements | Supplies the records | Prepares |
| Income tax and provisional tax returns | No | Prepares and submits |
| Tax planning and structure | No | Advises |
| Dealing with SARS audits and disputes | No | Handles |
Which do you need at your stage?
- Starting out. Register correctly and set up the books. An accountant helps you choose between a sole proprietor and a company (see how to register a company), then a bookkeeper or software keeps the books.
- Growing. Monthly books, VAT and payroll need a bookkeeper. Year-end statements, tax returns and planning need an accountant. This is the stage where one firm doing both saves time.
- Scaling. You start asking questions the books cannot answer: cash flow, pricing, funding. That is a CFO question. See outsourced CFO.
Where the tax practitioner fits
A tax practitioner is registered with a SARS-recognised controlling body and with SARS. Many accountants are tax practitioners, and some bookkeepers are too. Whoever completes your returns for a fee should be registered. Ask for the registration number. See how to choose an accountant.
What to do now
- Look at your books. Are they up to date and reconciled this month? If not, start there.
- List who files what. Know who is responsible for VAT, EMP201 and income tax.
- Ask for one point of contact if you use more than one provider.
- Review at year-end. Use our year-end checklist.
Frequently asked questions
Can a bookkeeper submit my VAT return?
A bookkeeper can capture the transactions and prepare the VAT figures. Whoever completes and submits returns for others for a fee generally has to be a registered tax practitioner, so ask who will submit and under which registration.
Do I need an accountant if I use cloud accounting software?
Software records and reports, but it does not decide how to treat a transaction, prepare your annual financial statements or advise on tax. Most businesses still need an accountant, at least for year-end and tax.
Is a bookkeeper cheaper than an accountant?
Routine bookkeeping is usually priced lower than accounting and tax work, but the right choice is the one that matches what you need. A cheap bookkeeper cannot give you tax advice.
Can one firm do both?
Yes, and it is common. TBL Accounting provides bookkeeping, management accounts, payroll, tax and VAT from one team, so the person who knows your books also knows your tax position.
When do I need a CFO instead?
When the questions move from what happened to what to do next: cash flow, pricing, funding and growth. An outsourced CFO, or virtual FD, covers that on a part-time basis.
Sources and further reading
This article is general information for South African businesses. It is not tax, legal or financial advice, and it reflects the rules and figures at the date shown above. Rules and fees change, so confirm the current position before you act.