Home Accountants How Much Do Accountants Charge

You’ve started a business.

You’ve worked every day in the calendar.

And you’ve put in enough blood, sweat, and lukewarm coffee that’ll be sure to make it a success.

One problem:

When you make money, you have to stay in control of it, right?

Well, when you make a lot of money, you have a lot more to do.

piggy bank
Another penny, another problem.

And those responsibilities detract from your job.

You didn’t sign up to be an accountant, did you?

You signed up to be the boss, the big cheese, the top dog!

But if you are indeed the top dog, you’ll know the importance of cutting costs for your business.

The thing is, doing your accounting yourself can eat away at your workday and be less efficient than a professional, losing the money you could be making in that lost time.

And hiring an overpriced accountant? That can add up, too.

Amber Williams, Author

Amber Williams
Accountant expert

Did You Know?

Accounting dates back a few years.

Or is that a few millennia?

There is evidence of auditing systems carried out by the ancient Egyptians.

In fact, one of my clients from last year was in exactly the same predicament:

As a business that developed video games, they knew how to design some awesome characters, and they could whip up a storyline in mere minutes.

But maths?

Not a chance.

However, the accountants they’d contacted had a price tag they simply couldn’t consider!

So, when they emailed me 11 months ago, I knew exactly what I had to do.

someone at work
Is this you, like, everyday?

I deduced what they needed doing, the prices of these individual services, and even found ways to lower the costs they would be forking out for.

11 months later and they’ve seen a 67% increase in profit.

And let me tell you - that was the only number they were happy to see!

Given their success, I thought it was best I let you in one a couple secrets...

This article is going to take you through:

- What accountants are

- How much do accountants charge

- How much do accountants charge different businesses

- How much do accountants charge per accounting service

- And our top QuoteGrab tips for reducing the bill

Chapter 1

What Are Accountants? And What Do They Do?

I don’t like maths.

I don’t understand it, I’m not good at it, and I never will be.

So, for your sake (and also mine), I thought it best to go through the basics slow-ly.

Let’s start with the definition, shall we?

An accountant records business transactions for an organisation and provides financial advice.

In general terms, they audit accounts, offer up financial advice, and undertake accounts administration.

But in rather more specific terms, here’s the typical responsibilities of an accountant:

Preparing accounts and tax returns

Carrying out payroll

Auditing

Compiling statements, budgets, and plans

Analysing accounts and plans

Providing tax planning support

Forecasting risk analysis

Negotiating business deals

Dealing with insolvency

Wow - that’s a lot!

(Don’t think I’ve been convinced to become an accountant just yet…)

Regardless of these tasks, accountants do specialise in specific areas of practice:

These areas include auditting, management consultancy, recovery, forensic accountancy, taxation, assurance, and corporate finance.

This is how I directed my client.

When they contacted me, they were on the lookout for a financial overhaul:

Having taken their first steps in a busy market, they wanted an accountant who could stay up-to-date with their finances, and help them get off the ground.

meeting between accountant and client
"Prepare to get off the ground!"

And as they’d had a pretty busy first 6 months of operation, they wanted someone to provide insight into all of their finances so far.

That’s why I found them an accountant who specialised in auditing.

As a specialist, they did come with a dearer price tag, but this actually lowered their costs when considering if they did the same jobs themselves.

Chapter 2

How Much Do Accountants Charge?

It’s all well and good to know how to lower the bill of your accounting.

But knowing why they’ve charged you that much?

That’s just as valuable.

How else are you going to work out how to lower your bill?

In simple terms, accountants charge by the service, not the hour.

And as they provide such complex support, different services will have a different price tag attached. So, it follows that deducing which services can be done yourself can help you budget your accounting needs.

thinking about the accounting they need done
Maybe he's hoping to see a solution to his accounting needs out the window?

However, before we discuss how accountants charge per service, we need to consider how they can be hired.

Hire an accountant from a firm

Looking for a trusted solution to your financial needs?

Seeking consistent support from qualified accountants?

Then hiring from a firm is an option for you.

They’ll have the know-how to match your business up with the right accountant, and provide the correct support that it needs.

And with one accountant or a team constantly working for your business, you can tailor the extent of the support.

This is by far the most professional service - and most expensive - on offer.

And that’s exactly why my client settled on a local accounting firm:

As much as they wanted to save, they knew that the accounting expertise they could receive was priceless.

Hire an accountant as an employee

An ‘inside’ accountant - as opposed to an ‘outside’ accountant from a firm - comes with a price-tag that you can control.

You can offer a certain salary in alignment with your business and its budget.

However, the price of this is prone to changing. As the business grows (fingers crossed), the accountant will have greater responsibilities and thus needs a higher salary.

Hire a virtual assistant accountant or a freelancer

Never heard of a ‘virtual assistant’?

In simple terms, if you give them a task, they can do it.

Just email ‘em, send a message, or hit ‘call’ on skype.

They do it, and send it back!

However, virtual assistant accountants - or remote freelancers, as they are also known - don’t tend to do long-term roles.

Rather, if you need help with an audit, or you need someone to draw up a financial statement pronto, they can do it.

Also, as VAs tend to come at a lower cost, outsourcing your accounting to a freelancer is an effective way to reduce your business costs.

When my client first came to me for help, I advised them to hire a VA or two to outsource some of their accounting.

Not only was it a cost-effective measure for a young business in a fragile market, but it also allowed them to see the level of accounting they would need from a firm.

Determining the kind of accountant you want might be the first step to budgeting for your business...

But working out the services and support you need is the next one!

By identifying the accounting that you can do (and the accounting you can definitely not do) is key to pocketing a few extra pennies.

I know, I know - I said myself that I hated maths...

So, why am I encouraging you to do it?

Because it means you can align your accounting needs with your business and its budget.

Amber Williams, Author

Amber Williams
Accountant expert

Did You Know?

Accounting is the fastest growing profession

With projected growth of 11% from 2014-2024, this beats out all other occupations.

You won’t be spoilt for choice, then!

And this is what I advised my client to do:

They’d just polished up their second video game when they realised that the next few months were going to be, well, tight.

They loved having an accountant from a prestigious firm, but needed to cut costs.

That’s when I suggested that they do their own bookkeeping!

Once I’d scanned through their accounting needs - and the individual costs of the services - I worked out which ones they could cut back on and save the fee for.

Fancy doing the same?

To that end, here are the services accountants can provide, and the average costs for a small business (£200k turnover or less):

Business Accounts

From £600 for a one-off service

Payroll - including PAYE

From £200 a month

Director’s Tax Return

From £300 for a one-off service

VAT Returns

From £150 for a one-off service

Full package of Bookkeeping, Vat, Quarterly Accounts, Year-end Accounts, and Tax Returns

From £250 a month

Fees for business accounts and VAT returns will increase alongside company turnover, as will payroll with the number of employees.

Chapter 3

How Much Do Accountants Charge Different Businesses?

Accounting is confusing, right?

Well, it’s about to get that much more complex:

Different businesses require different levels of accounting.

There are no straight forward numbers here, neither any easy answers; it all depends on your business.

And that’s where my client got lost.

someone looking confused at laptop
Just nod along...

As a small business, they’d been doing their own research on accounting before they threw in the towel and pinged me an email.

The first thing in their email was a very anxious paragraph:

“We know we need an accountant, but we don’t know how much it’ll cost…”

“We need actual prices - we can’t go off of guesses!”

Well, guess what?

That wasn’t the first email I’ve received that’s told me that.

And of course it’s not! Budgeting is difficult enough, but going off guesswork for something as important as staying in control of your money?

It’s asking for a financial disaster.

(Which ironically your accountant could protect you from!)

So, to guide you through your accounting woes, I’ve brought together all the different ways accountants can charge businesses based on size and structure.

You can thank me later...

First, here’s the average accounting prices for the different business sizes:

Start-ups

The services typically on offer include support with the business structure, accountancy and tax management, funding support, cloud accounting, and cash flow forecasting.

The average cost of this accounting is ||$||65.59||$|| a month.

SMEs

Accounting for SMEs often includes services included with start-ups as well as year end accounts, sorting your tax and national insurance, handling HMRC enquiries, and gives advice regarding business tax.

The average cost of this accounting is ||$||262.37||$|| a month, but it can be as low as ||$||80.32||$||.

This sharp increase from startups is due to the broad definition of SMEs.

Large businesses

Accounting for large businesses includes budgeting, cash flow forecasting, business planning, sorting management accounts, preparing annual accounts, bookkeeping, corporation tax preparation, VA services, payroll, and auto-enrolment.

The average cost of this accounting is ||$||2000||$|| a month.

And here’s the different business types and structures:

Sole traders

The services include bookkeeping, access to cloud software, annual business accounting, self-assessment filing with HMRC, and tax efficiency reviews.

The average cost of this accounting is ||$||32.80||$|| a month.

Limited companies

The services include account management with software, VAT returns, year-end accounts, IR35 solutions, and IR35 reviews.

The average cost of this accounting is ||$||52.21||$|| a month.

Partnerships

The services include bookkeeping, access to cloud software, annual business accounting, self-assessment filing with HMRC, and tax efficiency reviews.

The average cost of this accounting is ||$||32.80||$|| a month.

Contractors

The services include bookkeeping, cloud software, year-end accounting, submission of the accounts, corporation tax, submission of CT600 to HMRC, payroll, and the submission of RTI.

The average cost of this accounting is ||$||92.37||$|| a month.

Landlords

The services include bookkeeping, annual rental income accounts, self-assessment tax return submission, advice on property income and expenses, and tax agents to HMRC.

The average cost of this accounting is ||$||38.82||$|| a month.

Amber Williams, Author

Amber Williams
Accountant expert

Did You Know?

Accounting sounds like really complex maths, doesn’t it?

Turns out basic arithmetic and simple equations dominate their workload.

That being said, easy sums still aren’t my cup of tea...

Most of my clients are small businesses, so I advise them on the potential costs of their accounting.

However, it was only 3 months ago that I landed my first big business client.

With a yearly turnover of £9 million, I knew I had to match their big accounting needs to their big profit.

And boy, did I do just that!

As an up and coming fashion e-commerce store, they needed someone to take control of their finances so they could get back to creating the next hottest trend.

I focused on finding them top-notch accountants for a low-down price - the only condition was the accountants had to be particularly good at payroll as they were taking on new employees as they grew.

Chapter 4

Our Top Tips For Cutting Down Your Accounting Bill

Whenever I go for a shopping spree, I always end up in the same situation:

There’s me, standing at the till, praying that the total cost won’t break the bank.

See, when someone asks me what something costs, I know the question they’re going to ask next:

Don’t worry - I’ve pre-empted that question.

Here are our top tips for saving money on your accounting:

Determine what you need done

Audits are one of the most common services offered by accountants.

But did you know that you can audit your own accounting needs to help cut costs?

By determining the accounting tasks you need done, you can deduce the services you need to outsource to a firm, to a VA, or can do yourself.

You will probably still have to fork out for an accountant for some services, but reducing the amount of jobs they can do reduces the bill, too.

And this is the first thing I say to all of my clients.

Yep, each and every one. Even my big fashion retailer!

Use software

Let me take a wild guess…

You’re reading this article - ahem, this awesome article - on your laptop, aren’t you?

Or maybe on your mobile? Or another device?

But did you know that you can also do your accounting on these devices, too?

Thanks to the wonders of technology, accounting software exists.

So, by determining the tasks you can do with this software, you only need to outsource the tasks you can’t wrap your head around.

However, this only works for smaller businesses that can get away with doing smaller scale tasks.

So, even though my video game developer client did this, my fashion retail client did not…

Hire a VA

VAs are the new way to get ahead in business and come with a price-tag that makes them so popular.

And given some specialise in specific tasks like accounting, finding someone that can take care of your finances without hurting them has never been easier.

I even advised one of my clients from a mere 2 weeks ago to try and outsource to a remote freelancer.

They knew that they wanted to leave certain tasks regarding taxes and legal issues to the professionals, but wanted someone to do their bookkeeping.

With savings of 33% on their accounting bill compared to using their old firm, the VA clearly worked for them!

Could one work for you?

Get an accountant

The last tip on offer is to hire an accountant.

“Hold on - how does that reduce my accounting bill?”

It might not reduce your accounting bill, but it will lower the costs of running your business.

When you try and do your own accounting, chances are it’ll take a lot longer than a professional. That takes time away from your own work, costing the business money.

Oh, and don’t forget about the expensive errors you might end up causing!

It all adds up to a hefty bill that’ll cost more than hiring an accountant in the first place...

When I told my fashion retail client this they were surprised, and then they were disappointed.

They wanted to lower the price of their accounting, not stick with it!

And that’s when I told them about comparing accountants…

Compare accountants

Fancy finding a cheaper accountant?

Then you’ve got to get comparing ‘em!

Or, you could leave that to us, and grab a quote!

Once I’d directed my client to a quote, they found an accountant that could save them 17% on their yearly bill.

And when it comes to the numbers they’re running, that is one heck of a saving...

Conclusion

And there you have it:

By now you should know how accountants charge, how much they charge, and how to save on your final bill.

Check, please!

someone holding a credit card
"The steak was HOW much?"

So, now it’s over to you:

Are you ready to ditch accounting?

And are you looking to take things technological?