How much does it cost to hire a business accountant?

358

When it comes to handling the financial matters of your business, you must use the expertise of a professional to your benefit. A good accountant not only helps to maintain your financial statements, tax returns and other receipts but can also help you by assisting in budgeting and smart savings.

An accountant can perform the following functions to make your business profitable:

  • Prepare the financial reports of your business to determine its financial performance.
  • Maintain the accuracy of your business's financial records.
  • Prepare timely tax returns so that your business can avoid any penalties.
  • Offer financial advice for the growth of your business.
  • Forecast and analyse business trends to identify problems at an earlier stage.
  • Analyse the expenses incurred by your business and reduce unnecessary costs.
  • Help your business in generating revenue and, thus, maximising profits.

But the question is, how much do accountants charge for their work?

The fees of an accountant depend on various factors like:

  • The services required from the accountants (Whether the accountant performs basic compliance services like bookkeeping, annual accounts preparation and submission, tax returns or complex services like specialist tax advice and restructuring, monthly cashflow and management reports, etc.)
  • Specialist sector expertise, like Retail, Amazon businesses and hedge funds
  • The specific requirements of your business
  • The type and size of your business, and the scale of the activities that your business performs
  • The experience of the accountants (Accountants having more experience tend to charge more as compared to someone new in this field)
  • The turnover of your business (For services like business accounts and VAT returns, the fees increase with the increase in turnover of your business)
  • Number of bank accounts
  • The number of transactions. If you are a high transactions business, like a restaurant, bookkeeping costs will be higher.

The accountant may charge your business on a monthly, hourly, or service-by-service basis. We recommend having a fixed price accountants, as it helps manage cash flow.

How much do accountants charge on a monthly basis?

The monthly fee of an accountant can vary from as low as £50-£60 to as high as £200-£250.

You can estimate the cost of an accountant based on the package offered by the accountant, your company's location, the turnover rate of a company and other factors.

The standard package provided by most of the accounting firms include services like bookkeeping, providing day-to-day financial advice, payroll, and annual basis, handling the tax returns, accounts, confirmation statement, etc.

How much do accountants charge on an hourly basis?

For essential services like bookkeeping or working on a return, an accountant may charge around £15-£35 per hour.

When it comes to providing specialist services like taxation, an accountant's fees may be around £100-£250 an hour. 

How much do accountants charge per service?

An accountant may also charge you on a service-by-service basis.

The fees of an accountant vary depending upon the size or the turnover of the business, type and the complexity of the service to be performed.

If you want the accountant to handle the business accounts, prepare tax returns and confirmation statement. Then the accountant charges may vary from £100 to £4,00 depending upon the business's turnover.

  • £500 estimated fees for a turnover ranging from £20,000 to £30,000
  • £800 estimated fees for a turnover ranging from £30,001 to £85,000
  • £2,000 estimated fees for a turnover ranging from £85,001 to £250,000

If the accountant has to perform payroll services, then the fees will depend upon the number of employees.

  • £200 estimated fees (per month) if the number of employees is around 50.
  • £500 estimated fees (per month) if the number of employees is around 100.

For services like VAT returns, an accountant may charge around £100-£400 per VAT return depending upon the business turnover and number of transactions.

  • £150 estimated fees for a turnover ranging from £0 to £100,000
  • £250 estimated fees for a turnover ranging from £100,000 to £200,000
  • £400 estimated fees for a turnover ranging from £200,000 to £400,000

Conclusion:

To get an accurate fee estimate that an accountant may, you can get quotes after talking to at least 3 accountants.

You can reduce the accounting fees that you have to pay by taking steps like providing timely information, maintaining bills and receipts in an organised manner, and using the appropriate software for your business

The fees charged by an accountant may seem alarming but hiring an accountant will help in the growth and development of your business in the long run.

Having a good accountant on your side will help you to ensure the financial success of your business.

You must hire an experienced accountant in London with an in-depth understanding of the financial aspects of your business, good analytical skills, along the ability to pay attention to detail. Also, you both must have chemistry and get along well.