How Much Does an Accountant Cost in the UK?

When you run your own small business there can be pressure on your finances. From startup costs to marketing investment, rising operating expenses to unexpected tax bills, many business owners will naturally look for ways to keep costs down wherever possible.

Because of this, some sole traders, landlords and limited company owners may initially view hiring an accountant as an unnecessary expense. However, the reality is that the right accountant can often save a business far more money than the cost of the service itself, not to mention reducing your stress levels and the time you have to spend on admin.

Rather than simply being just another outgoing cost or a waste of money, an accountant should be viewed as an investment in a strategic partner, long-term success and the financial health of your business.

When weighing things up, one of the most common questions self-employed people ask is ‘how much does an accountant cost in the UK?’ The answer depends on a number of factors including your business structure, the level of service you need, the complexity of your finances and which accountant you use.

In this post, we’ll explore the value an accountant can bring, the benefits of professional support, and why working with the right accountant can help you operate more efficiently, ensure compliance and drive your business forwards.

What Do Accountants Do?

This is a very pertinent question as anybody that’s considering appointing an accountant will want to know what they are getting for their money, and how it will benefit them.

The traditional view is that accountants mainly help out when taxes are due, but the reality is that modern accountants, such as ourselves, provide a wide-ranging, technology-focused service with expert overarching year-round accountant support that goes far beyond tax compliance.

So what services should you look for from an accountant?

• Accounting software supplied as part of their service
• Preparation and submission of self-assessment tax returns
• Preparation and submission of VAT returns
• Preparation and submission of Corporation Tax returns
• Preparation and submission of Payroll
• Bookkeeping reviews and advice
• Compliance support including Making Tax Digital if you fall in scope
• Year-end accounts
• Tax planning and advice to maximise tax-efficiency
• Statutory filings and financial statements
• Forecasting and financial reporting
• Reminders for deadlines and payments
• Strategic guidance
• Company formation

The services you need will of course vary depending on factors such as your business structure and tax obligations but it’s important to find an accountant that covers all your needs, inclusive in their monthly fee.

Why an Accountant is an Investment in Your Business

When businesses search for an accountant, it is natural to focus on their fee but the real value lies in the benefits they provide and that’s why it’s important to find the right accountant.

A good accountant should be viewed as an investment in your business rather than simply an expense. With the right support, you can save money, stay compliant, save time and money and better understand your business finances and tax position so you can make decisions with confidence, backed up by the expertise of an accountant.

Here are some of the ways they can help.

They Save You Money

You of course have to pay a fee for the services of an accountant, but the reality is that they can actually save you money. The right accountant will support you by advising on tax optimisation strategies to ensure you’re operating as tax-efficiently as possible, including:

• Ensuring you’re operating through the right business structure
• Claiming all available allowable expenses
• Structuring remuneration through a combination of salary and dividends
• Timing income to reduce tax liability
• Utilising all available tax reliefs and allowances
• Tax-efficient planning for income and expenditure
• Advising on VAT schemes and ensuring VAT efficiency
• Utilising pension contributions
• Leveraging capital allowances

Over time, these savings can add up and outweigh the cost of the service itself, often significantly.

They Keep You Compliant

As well as helping to reduce your tax bill, an accountant can save you money in another way by ensuring you remain compliant and avoid unnecessary fines, penalties or interest charges from HMRC.

Tax rules, thresholds and reporting requirements can change regularly making it difficult for busy small business owners to keep abreast of the latest regulations.

With the support of an accountant, you have peace of mind that your finances and tax obligations are in expert hands and that you’ll be compliant with the latest regulations. In addition, an accountant will ensure that all your submissions are accurate and filed on time, reducing the risk of errors and missed deadlines so you avoid any HMRC attention or fines.

They Save You Time

Managing your bookkeeping, finances, invoices, expenses and tax obligations can quickly become time-consuming, particularly when you’re trying to focus on running and growing your business.

Modern accountants help save significant amounts of time by providing cloud accounting software, such as FreeAgent or Xero, that streamlines and automates many day-to-day financial tasks.

Accounting software can link with your business bank account and automatically import, categorise and reconcile your transactions. It also manages invoicing, tracks expenses, allows you to upload receipts in real-time and generates a host of key financial reports. It also generates tax and cash flow projections and calculates your tax returns in the background while you work.

This significantly reduces the amount of manual input needed as well as improving accuracy. In combination with an accountant, this saves you a huge amount of time.

Better Financial Management and Strategic Guidance

One of the biggest benefits of working with an accountant and using accounting software is having clear visibility over your finances, making it much easier to understand how your business is performing all year-round rather than waiting until January.

With accounting software and ongoing accountant support, you can:

• Understand your upcoming tax liabilities and plan ahead
• Monitor cash flow
• View up-to-date financial reports
• Keep your records current and organised

This improved visibility gives you a clear picture of your financial position helping you keep on top of your taxes, monitor cash flow and make informed business decisions based on up-to-date data, and with the support of an accountant it facilitates strategic planning.

Strategic planning is a key part of an accountant’s service to help your business grow and improve profitability. This includes identifying opportunities to reduce costs and structure your finances and tax affairs in a more tax-efficient way to support long-term growth and stability.

They can also support with forecasting, budgeting and scenario planning to help you understand the potential impact of key decisions before you make them. This gives you a clearer view of how your business is likely to perform in different situations, allowing you to plan ahead, manage risk more effectively and make confident financial decisions.

Our Accountancy Service

To answer the question of how much does an accountant cost in the UK, it depends on the service you need. Our limited company accountancy service costs £125 +VAT per month, our sole trader service is £62 +VAT per month and our landlord accountancy service starts at £62 +VAT per month with tiered pricing based on how many properties are in your portfolio. We can also offer a 10% discount if you pay for your first year upfront!

Our fees are great value, all-inclusive and fully transparent with no nasty surprises so you get the right support and know exactly how much you’ll pay from the outset.

You’ll work with your own dedicated accountant who will expertly manage all your business and personal accounting needs and tax obligations, ensuring compliance and that you’re operating as tax-efficiently as possible.

We provide unlimited support and advice no matter how many times you contact us and a same working day response to your queries is guaranteed thanks to our client service guarantee. FreeAgent or Xero MTD-compliant accountancy software is also included saving you up to £330 a year. Get in touch today to speak to an accountant if you’d like to learn more.