Most travel businesses I speak to have been with the wrong accountant for longer than they should have been. Not because they didn’t notice something was off. But because switching accountants as a UK travel business feels disruptive, so they put it off. For UK travel agents and tour operators, that decision is more costly than it looks — because the problems with the wrong accountant don’t announce themselves. They build up quietly.
Why travel businesses stay with the wrong accountant for too long
The returns get filed. Nothing has blown up. The accountant replies to emails within a reasonable timeframe. On the surface, everything looks fine.
The problem with travel accounting is that fine and correct are not the same thing.
TOMS errors don’t announce themselves. Incorrect VAT treatment on commission income doesn’t trigger an immediate HMRC letter. Principal vs agent misclassification doesn’t show up as an obvious red flag on a VAT return. These things build up quietly, over multiple periods, until the point where someone looks properly at the numbers — or HMRC does it for you. This is exactly how a travel business ends up with three years of backdated VAT exposure — as I described in a real case involving TOMS and spreadsheets.
By that point, you are not looking at one quarter of corrections. You are looking at years.
You are not fine just because nothing has gone wrong yet. You are fine when the structure is correct.
Signs your current accountant doesn’t understand travel accounting
The clearest sign is also the simplest one: they have never had a serious conversation with you about TOMS.
Not mentioned it in passing. Not sent you a link. A real conversation, where they explained whether TOMS applies to your business, why, and how it affects your VAT treatment.
If that conversation has never happened, there are two possibilities. Either TOMS genuinely doesn’t apply to your business — in which case your accountant should have explained that too. Or it does apply, and it hasn’t been handled correctly.
Other signs worth noting:
Your VAT returns look suspiciously straightforward. Your accountant treats your income as standard turnover. They have never asked you whether you operate as principal or agent. When you ask them a technical question about VAT for travel businesses, there is a pause before the answer that tells you they are working it out as they go.
If your accountant has never had a proper conversation with you about TOMS and how it applies to your business, that conversation will happen eventually. The only question is whether it happens with them, or with HMRC.
What switching accountants as a travel business actually involves
Less than most people expect. Switching accountants as a UK travel business is primarily a paperwork process — your incoming accountant handles most of it.
You notify your current accountant. They are required to respond to a clearance letter from your incoming accountant — this is a professional obligation, not a courtesy. Previous records and returns are transferred. Your incoming accountant reviews what’s there, identifies anything that needs addressing, and sets up the structure correctly going forward.
The handover takes roughly a month of admin. Once it is complete, you will need to authorise your new accountant to act with HMRC — this is done online and takes a few minutes
Here is what people don’t tell you about that review of historic records: it sometimes finds errors. Incorrect VAT treatment from previous periods. Margins calculated on the wrong basis. Commission income handled incorrectly.
Finding errors is not a reason to avoid switching. It is a reason to switch sooner — because every additional quarter with the wrong structure adds to what will eventually need to be corrected.
The disruption of switching is one month of admin. The cost of staying with the wrong accountant is years of incorrect VAT treatment, and a correction bill that arrives at the worst possible time.
What to look for in a specialist travel accountant
Ask them directly: how many travel businesses do you currently work with?
Not how many have you worked with. How many right now, actively, on an ongoing basis.
An accountant who works with two or three travel businesses alongside a hundred general clients is not a specialist. They have exposure. That is different.
A genuine specialist works in your sector daily. They don’t look up TOMS before your call. They already know whether your structure is correct within the first ten minutes of talking to you, because they’ve seen the same patterns in other businesses and they know exactly where the problems hide.
Other things worth asking: do they work in Xero — and do they understand how to structure it specifically for TOMS? Do they work with principal and agent models, or only with one type of travel business? Will they tell you what is correct, or what you want to hear?
There is a difference between an accountant who has read about TOMS and one who works with it every day. That difference becomes visible the first time something complicated needs a decision.
If you are a travel agent specifically, you can read more about what specialist accounting for travel agents actually covers. And if you run a tour operator business, this page covers what’s different about tour operator accounting.
When is the right time to switch
The cleanest time to switch is at the start of a new VAT quarter or a new financial year. It makes the handover tidier and gives the incoming accountant a clean point from which to take over.
But if something is actively wrong — if your VAT treatment is incorrect, if your margins have never been properly calculated, if you have never had a TOMS conversation with your current accountant — do not wait for a clean date. Another quarter of incorrect treatment costs more than a slightly untidy handover.
There is no perfect time for switching accountants. There is only the point at which you decide the current situation is no longer acceptable — and for a UK travel business, the sooner that point comes, the less it costs to fix. If you are starting a new travel business rather than switching, read our guide on setting up a travel agency in the UK with the correct structure from day one.
What happens on a discovery call with LAS Accounting
I ask about your current setup, your VAT treatment, your bookkeeping structure, and whether TOMS has been applied correctly. I look at what you have. I tell you honestly what needs to change and whether I can help.
If it’s not a fit, I say so.
If you are a UK travel agent, tour operator or travel agency and you have been wondering whether your accounting is actually correct — not just filed, but correct — Talk to a specialist about your current setup.
