How much do accountants charge?

An accountant’s fees can vary a great deal, depending on the size of your business, the scale of your activities and the services you require. However, once you know these things it’s quite easy to estimate the likely cost of your accountant.

General accounting for small businesses

A small business may be anything from a self-employed contractor to a limited company with up to 50 employees. Accounting for this kind of enterprise usually includes a range of services delivered as a package, typically including:

  • Annual accounts
  • Bookkeeping
  • Corporation tax returns
  • Director’s personal tax return
  • Monthly & annual payroll returns
  • Quarterly VAT returns
  • Advice on tax avoidance legislation (IR35)
  • Ongoing day-to-day advice from your accountant

The above is a fairly standard core package (some accounting firms may offer more) and is usually delivered for a fixed monthly fee.

For smaller businesses, this monthly fee can be as low as £60 or as high as £250 depending on things like turnover, depth of service and where in the UK you are. Businesses with more employees and higher turnover can expect to pay more.

Other ways to pay your accountant

Many businesses like to pay their accountant a monthly fee as this provides certainty. However, you can also pay your accountant by the hour, or for individual services.

You can also mix-and-match, paying for some services via a fixed price or monthly fee, while paying for more bespoke services by the hour.

An accountant performing the basic accounting services will usually work for between £25 and £35 per hour.

More specialist services like tax planning and business planning advice may be much more expensive, in the region of £125 to £150 per hour.

Accounting fees per service

Some businesses choose to hire their accountant on a service-by-service basis, such as for year-end accounting, VAT returns or payroll services. Typical one-off fees for such services are as follows:

Service

Turnover / size

Typical fee

Business accounts

£20,000 to £30,000

£150

 

£100,000 to £130,000

£400

 

£250,000 to £300,000

£600

Payroll services (incl. PAYE)

50 employees

£200 per month

 

100 employees

£500 per month

Director’s tax return

 

£300

VAT returns

£0 to 100,000

£100

 

£100,000 to 200,000

£150

 

£200,000 to 400,000

£200

Generally speaking, fees for services like business accounts and VAT returns will rise with company turnover. Likewise, payroll fees will rise with the number of employees. If you own rental properties then this can add to the cost of your personal tax return.

Remember: the fees given in this guide are for guidance only. Talk to your accountant about what services you need and ask them to quote their own rates. Don’t be afraid to shop around and compare, and remember – the cheapest may not be the best, and the most expensive isn’t necessarily the best either.

You can do your bit to keep accounting fees to a minimum by maintaining good record keeping, providing all necessary information in good time and using the appropriate software (ask your accountant what package they recommend).

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