Accountants for pubs

Midlands Accountancy acts as accountant for pubs in Birmingham and the West Midlands, handling wet and dry sales records, tied tenancy accounts, machine income, payroll and VAT for licensees. Running a pub means running a business where the landlord may also be your main supplier, the stock evaporates in more ways than one, and the fruit machine in the corner has its own accounting rules. Pub finance has a shape of its own, and this page sets out how we handle it for licensees across the region.

Licensees behind every kind of bar

We act for tenants and leaseholders of pub company and brewery estates, free-of-tie operators, freeholders, managed-house operators, and community groups that have taken on their local. Pubs are part of our wider hospitality accountants hub along with restaurants, hotels and caterers.

A local for locals across the Midlands

Pubs are woven into the West Midlands and so are we: a Birmingham practice acting for licensees across the city, the Black Country and the wider region. Most of the work runs remotely around your opening hours, and when a sit-down is needed we will come to you.

Tied, free of tie, and what it does to your numbers

The tie is the financial fact that shapes a tenanted pub. A tied agreement typically obliges you to buy some or all of your drinks through the pub company or brewery, usually at higher prices than the open market, in exchange for lower rent and other support; a free-of-tie operator buys where they like and pays rent that reflects it. Neither is automatically better, but they produce differently shaped accounts: the tie moves cost from rent into the wet purchase line, so margin comparisons that ignore tie status mislead, and negotiations with the pub company need accounts that reflect the agreement you signed.

Wet, dry and the split that runs through everything

Pub income divides into wet sales at the bar, dry sales from food, and a tail of other income: accommodation where there are letting rooms, function hire, and machine income. The split matters because the two sides carry different margins, stock behaviour and staffing, and a pub drifting between wet-led and food-led models needs to see that drift in the numbers, so tills should separate wet and dry at source.

Stock yields, the pub’s own truth serum

Beer is bought by the barrel and sold by the pint, and between the two sit line cleaning, spillage, wastage, free pours and sometimes deliberate leakage. A yield calculation compares what a cask or keg should produce with what the till says was sold, and regular independent stocktakes with yield results per line are standard practice in well run pubs. Poor yields are an early warning, and the bookkeeping needs stocktake results, allowances and adjustments recorded so the accounts reflect reality. Our guide to what information an accountant needs covers the records a licensee should keep, cellar to till.

Machines, and money that is not all yours

Gaming machines, pool tables and jukeboxes produce cash that needs careful handling: takings are typically shared with the machine supplier under an agreement, and gaming machine income has its own tax regime separate from VAT on drinks. The records need to show gross takings, the supplier’s share and your retained income, evidenced by collection statements. Machine cash handled loosely is a classic gap in pub records.

The licence and its running costs

A pub carries a distinct category of regulatory spending: premises licence fees, personal licence costs, door supervision, music licensing, and the professional costs of licence variations or reviews. They deserve their own place in the records because they recur on their own calendars and because a lapsed fee has consequences beyond the accounts, so we set books up to track the category and its renewal dates.

Cellar to ledger bookkeeping

Daily cash-ups reconciling till readings to cash and card banked, brewery and wholesaler invoices matched to statements, stocktake results entered, machine collections recorded, and accommodation or function income tracked separately: that is the weekly rhythm through our bookkeeping service. Pubs remain cash-heavy, which makes banking discipline and till controls more important.

Tax, VAT and staff behind the bar

Drink sales sit squarely within VAT and food brings the usual hospitality complications; current thresholds are on GOV.UK, and our VAT returns service prepares returns from till data captured correctly. Bar and kitchen staff mean payroll each period with workplace pension duties, handled through our payroll service, and live-in arrangements for staff or the licensee add accommodation questions with fact-specific treatment we review case by case. The trading structure follows the agreement and risk profile, and tenancy agreements sometimes constrain the choice.

What the cellar tells you that the till does not

Useful pub management figures: weekly wet and dry takings against the same week last year, yield percentages by line, staff costs against takings, rent and tie costs as a share of wet sales for tenants, and a rolling cash forecast around quarter days, VAT payments and the brewery bill. Our cash flow forecasting service builds that forward view for the lean weeks that follow a strong December.

Where licensees get hurt financially

The sector’s recurring wounds: yields never measured so shrinkage runs unchecked, machine income pocketed casually with no statement trail, tie purchases unreconciled against agreement terms, wet and dry sales merged at the till, no cash controls in a cash business, and licensing costs missed until the renewal lapses.

What our accountants for pubs bring to the bar, and what we do not

We provide bookkeeping, accounts, tax, VAT, payroll, cash forecasting and honest analysis of whether the numbers stack up, including support with rent reviews and tenancy decisions. We do not give legal advice on tenancy or licensing, conduct stocktakes, or negotiate with pub companies for you, though we arm you with figures that hold up when you do.

First orders: how an engagement starts

Tell us the pub, the agreement type, the wet dry mix, staff numbers and the state of the books, and whether a tenancy decision or rent review is looming, and we quote a fixed fee, with catch-up work priced separately. Our guide to small business bookkeeping costs gives a sense of what the routine work runs to.

Frequently asked questions

I am taking on my first tenancy. What should I check financially before signing?

The rent and tie terms against realistic takings for that site, not the marketing projections. We review the numbers in the agreement and tell you what the pub would need to take weekly to pay you a living.

How do I account for the machine money?

Record gross collections, the supplier share and your retained portion from each collection statement, and keep the statements. Machine income interacts with its own duty regime, so never lump it into bar takings.

Do you act for both the pub and the licensee personally?

Usually yes: the business accounts and the personal Self Assessment or company filings belong together. Where a partnership runs the pub, we act for the partnership and the partners individually.

Can you help if the pub is struggling?

Earlier is better. We can show quickly whether the problem is margin, cost, rent or volume. Where the honest answer is that the numbers cannot work, we say so and support the conversations that follow.

If your pub deserves numbers as well kept as its cellar, request a quote with a note about the site and your agreement, and we will price the support to match.