It is estimated that there are almost 100,000 accountancy practices in the UK. Accountants can spend years building up their accountancy business, so when the time comes, how to sell an accountancy practice is one of the most important decisions an owner can make. It’s not only about price – it’s about timing, preparation, cultural fit and finding the right person, team or business to do a deal with.
Many UK practitioners seeking to sell their accountancy firm ask the same question: what is the best way to sell my accountancy practice? Getting it right protects a lifetime of work and secures the future of the staff and clients alike. We asked the UK’s leading brokerage firm Kingsman Partners for practical advice when thinking of selling an accountancy practice.
What does “Sell My Accountancy Practice” really mean?
When an owner decides to sell their accountancy practice, it can mean several things:
- Selling the entire firm – whether this be a sole trader, partnership, LLP or Limited Company
- Selling a block of recurring fees
- Merging with another firm
- Completing a phased exit or gradual retirement
The value is largely in the goodwill – the recurring income from loyal clients. According to Maximiti, UK practices often sell for 0.8× to 1.2× annual recurring fees, depending on client mix, retention, and risk. For larger firms with an adjusted EBITDA of more than £500K, you can attract a larger multiple, as the private equity backed buyers start coming to the market at this level.
We note that deals commonly include clawback provisions, allowing buyers to reclaim part of the payment if clients leave after completion. The value to any buyer of the business will be what they bill and collect post completion date. Therefore, a consultancy agreement is imperative during the earn-out period to make sure that maximum value is obtained from the seller and to the buyer.
Why timing matters – and market trends
Timing can make a major difference. The UK accountancy sector is seeing strong consolidation, with private-equity-backed firms acquiring smaller practices. Xeinadin Group, for instance, is reportedly pursuing a sale worth around £800 million, at roughly 14× EBITDA, according to The Times.
At the same time, over 150 accountancy practices are currently listed for sale in the UK on one business selling website alone.
Preparing the practice before you sell
A well-prepared firm attracts stronger offers, so ensure you have the following housekeeping in order:
- Organise financials
Buyers expect clarity. Present three to five years of clean accounts, profit/loss statements, and cash flows. Resolve discrepancies early.
- Document systems
Show that the practice can operate without you. Document workflows, software use, and client-handling procedures.
- Segment clients
Highlight recurring work and client demographics. Firms with younger, expanding client bases achieve higher valuations.
- Strengthen the team
A motivated, stable team increases value. Address morale and retention before sale.
- Check legal and compliance matters
Resolve any regulatory or client issues in advance.
- Plan your exit
Decide whether you’ll leave immediately or remain for a transition. Earn-outs or phased exits can improve total returns if structured carefully.
Routes to sell: Which option works best?
Different routes suit different sellers.
Using a broker
Specialist brokers handle valuation, negotiation, and confidentiality. Generally speaking, their knowledge of the market is far superior to the business owners.
When selecting a broker, it is crucial that the entity you choose has specific knowledge and experience in your sector.
Selling directly
Some owners prefer to sell to known competitors or peers. It can be quicker but may reduce competitive bidding; these owners are unlikely to maximise their exit value.
Selling a client bank
Selling a block of recurring fees offers a faster exit, though often at a lower multiple.
Merging
Joining a larger firm brings strategic benefits and continuity; for instance the potential to offer more services to the client base.
Management buy-out (MBO)
Selling to internal staff preserves culture but requires funding support and trust. This usually leads to lower multiples obtained.
Negotiation and deal structure
Headline price isn’t everything. Deal structure affects overall value and risk:
- Payment terms: lump sum, instalments, or earn-out.
- Clawback clauses: protect the buyer if clients leave.
- Non-compete restrictions: define post-sale limitations.
- Warranties: ensure accurate disclosure.
- Transition periods: enable client retention.
- Tax planning: structure deals efficiently for Capital Gains Tax.
- TUPE compliance: secure employee transfers.
Careful drafting avoids disputes and protects both parties.
Managing the transition
After completion, focus turns to retention and continuity.
- Inform staff and clients at the right time.
- Personally introduce the buyer to key clients.
- Manage data, systems, and software handovers.
- Support retention through clear communication.
Smooth transitions maintain goodwill and prevent clawback claims.
Common mistakes when trying to sell an accountancy practice
- Delaying preparation.
- Overvaluing due to sentiment.
- Ignoring staff engagement.
- Poor client documentation.
- Accepting the first offer.
- Overlooking tax implications.
- Signing strict non-competes.
Avoiding these traps ensures better results when deciding to sell your accountancy practice.
Selling an accountancy firm takes planning and precision. Owners who prepare early, maintain clean books, and seek the right professional support tend to secure the best outcomes.
For practice owners exploring their options, Kingsman Partners offers discreet, end-to-end support – from valuation through to completion – helping sellers find the right buyer while protecting client continuity.
