Accounts, tax, client account bookkeeping and partner drawings for London law firms — from a practice that acts for law firms and nothing else.
The short version. London is in England. Your firm is regulated by the Solicitors Regulation Authority, your client account is governed by the SRA Accounts Rules, in force since 25 November 2019, and the annual obligation is an Accountant's Report under rule 12, obtained within six months of the accounting period end and delivered to the SRA only if it is qualified. Partners pay UK income tax rates and bands, and property transactions attract Stamp Duty Land Tax. We work with London law firms remotely, and only with law firms.
London holds every kind of law firm at once: the international and City practices, mid-market commercial firms, specialist boutiques, and a deep high-street market spread across the boroughs doing conveyancing, probate, family, immigration and crime.
Because the range is that wide, no two London firms are comparable, and a benchmark drawn from "London law firms" describes nobody. A litigation or advisory boutique off Chancery Lane may hold no client money at all and sit outside the Accountant's Report regime entirely. A suburban conveyancing practice three stops out can be holding well past the £250,000 maximum on the statement dates the rule 12.2 test is measured on. Those two firms have almost nothing in common financially, and the first job on any London engagement is working out which one we are looking at.
Two cost lines make a London profit and loss read differently from anywhere else, and neither moves quickly: premises and salaries. Fixed costs that large put more weight on lockup than most owners allow for, because the gap between doing the work and being paid for it is funded out of the same cash that pays the rent. That is where we start in London — the WIP days and debtor days before the tax, the structure or anything else.
The Solicitors Regulation Authority regulates solicitors and law firms in England and Wales, and the SRA Accounts Rules are the rulebook for your client account. Everything else on this site applies to you without translation: the rule 12 Accountant's Report, the rule 12.2 exemption at an average of £10,000 and a maximum of £250,000, the five-weekly three-way reconciliation in rule 8.3, and the rule 4.3 requirement to deliver a bill or other written notification of costs before transferring client money to pay your own fees.
One change is coming. On 2 June 2026 the SRA announced that it has submitted a package of client money rule changes to the Legal Services Board and said that, subject to approval, it expects the new rules in force by early 2027. Under that package every firm holding client money would submit its report to the SRA rather than only firms whose report is qualified, with an annual declaration alongside it and the reporting accountant filing directly. It is not law yet. It is close enough to plan for.
A London firm's client account profile follows its work, not its postcode. Commercial advisory, employment and litigation practices frequently hold nothing beyond money for their own fees and disbursements, which is the rule 2.2 route out of holding a client account at all. Residential and commercial conveyancing, probate and personal injury go the other way: high volume, large single balances, and an exemption test that is failed by a wide margin.
The Royal Courts of Justice on the Strand and the Rolls Building on Fetter Lane are both in London, and the Rolls Building houses the Business and Property Courts of England and Wales — the commercial, chancery, insolvency, construction and technology lists that the seven regional district registries mirror. The Law Society is at 113 Chancery Lane, and the SRA keeps a London office alongside its Birmingham headquarters.
UCL's Faculty of Laws, the Dickson Poon School of Law at King's College London, LSE Law School and the School of Law at Queen Mary University of London are all within a few miles of each other, which is why London firms recruit from a deeper pool than anywhere else — and why London salary bands set the reference point that firms elsewhere are measured against.
The first thing we establish in a London firm is which of the two businesses it actually is, because the answer decides everything after it. A practice holding client money in volume needs the reconciliation discipline, the transfer evidence and the annual report built into the year. A practice holding none needs the rule 2.2 position documented properly and then never has to think about it again. After that we go straight to the fixed cost base — premises and salaries — and work out how many months of lockup the firm is funding out of the same cash that pays them.
Client account bookkeeping and the five-weekly three-way reconciliation. The firm's annual accounts, the partnership or corporation tax return, partner tax reserves and drawings, payroll, VAT and the management figures you run the firm on. All the preparation that decides whether the report is clean.
Buzz Accounting Ltd is licensed by the AAT and a member of the ICPA. It is not a chartered accountancy firm and not a registered auditor.
Colin Ellis, ICAEW and a Responsible Individual, prepares and signs the SRA Accountant's Report itself. Rule 12.5 of the SRA Accounts Rules requires a member of ICAEW, ICAS, ACCA or ICAI who is, or works for, a registered auditor — and only that person can sign it.
Anstey Bond LLP is a separate firm, registered for audit by the ICAEW. Companies House OC360626.
No, and it is worth saying why rather than just asserting it. Everything runs remotely — video and phone around your court and client commitments, records and approvals handled securely online — which is how most firms prefer it once they have tried it. What you gain by widening the search past your postcode is a practice that already knows the Solicitors Regulation Authority, the SRA Accounts Rules and what a three-way reconciliation is, without being taught. Tell us where your firm stands and we will tell you honestly whether we can add anything.
The Solicitors Regulation Authority. London is in England, and the SRA regulates solicitors and law firms across England and Wales, so the SRA Accounts Rules govern your client account. If you held or received client money at any point in the accounting period, rule 12.1 requires you to obtain an Accountant's Report within six months of the period end, and to deliver it to the SRA only if it is qualified. Rule 12.5 requires that report to be prepared and signed by a member of ICAEW, ICAS, ACCA or ICAI who is, or works for, a registered auditor.
Only to the parts of your practice the SRA authorises. A London firm authorised by the SRA is subject to the SRA Accounts Rules for the client money it holds through that body. Opening in Scotland or Northern Ireland does not extend those rules to the new practice: solicitors in Scotland are regulated by the Law Society of Scotland under rule B6 of its Practice Rules 2011, and solicitors in Northern Ireland by the Law Society of Northern Ireland under the Solicitors' Accounts Regulations 2014. Two regulators means two rulebooks, two reporting deadlines and two sets of records, and the bookkeeping has to be built for that from the start rather than reverse-engineered at the year end.
They follow the practice, not the postcode. An SRA-authorised body is subject to the SRA Accounts Rules for the client money it holds through that authorised body, wherever the office sits. What does not happen is the reverse: opening in Edinburgh or Belfast does not bring that separate practice under the SRA, because solicitors there are regulated by the Law Society of Scotland and the Law Society of Northern Ireland under their own accounts rules. Firms that operate in more than one nation end up running parallel compliance regimes with different reporting deadlines, and the accounting has to be built to produce both sets of figures rather than one.
By treating them as the fixed commitment they are and building the cash plan backwards from them. Premises and salaries do not move in response to a slow quarter, so the variable that absorbs a bad month is cash, and cash is mostly lockup. A firm carrying three months of work in progress and two months of debtors is funding five months of fee income before a penny of it arrives. We would put a figure on that first, then look at billing frequency, payment terms and whether any department is structurally slower than the rest. Cost cutting is the last lever, not the first.
No. We work remotely with law firms across England and the whole UK, by video, phone and email, with records and approvals handled securely online. That is a deliberate choice rather than a limitation: it means the people looking at your figures work only with law firms, so nobody has to be told what lockup is, why a client account reconciliation is three-way, or what a fixed-share partner is. A firm two hundred miles away that already understands the England position starts from a different place than the nearest general practice accountant, who will spend the first meeting being taught how a law firm works.
Not every firm does. Rule 12.2 exempts you if all the client money you held or received in the period came from the Legal Aid Agency, or if the statement or passbook balance of client money did not exceed both an average of £10,000 and a maximum of £250,000. Both limbs of that second test must be met, and the average is worked out by adding up all your reconciliation balances and dividing by the number of reconciliations. Rule 2.2 goes further: a firm whose only client money is money for its own fees and unpaid disbursements can operate without a client account at all, provided it tells the client in advance where and how the money will be held.
A free, no-obligation conversation about where your client account and your firm's numbers actually stand. If we cannot add anything, we will say so.
One short email: what has changed in the Accounts Rules, the dates coming up, and one number worth checking in your firm. No spam, unsubscribe any time.