How much does an accountant cost / charge in the UK? Accounts for self-employed and limited companies (Part 1)
This is a question that you may be searching for if you have just started a new business for the first time. You may even be wondering what the benefits in having an accountant are or ‘Do I need an Accountant?’. We will cover those questions on another article…
‘How much is a piece of string?’ may be a fairly typical off the cuff answer from a traditional accountant. The truth is that many accountants do not like discussing costs, fees, prices or whatever you want to call it. But I will ask why! Why should any business, accounting or otherwise not be transparent when it comes to pricing?
This leaves the potential client with the following questions:
- ‘what are they hiding’
- ‘they must be expensive’
- ‘how can I just get an idea of cost?’
- ‘do they have fixed fees or not?’
The actual reason that most accountants do not talk about cost on the phone and especially on their website is because they have no consistent and official pricing system. In some cases they may as well just stick their finger in the air and see which way the wind is blowing and make up a number!
Ok so that’s a bit harsh but a typical method is to find out how much you are paying and quote the same or maybe a bit less to try and win the work. The issue with this is that it’s not consistent, it’s not fair on your other clients that are paying a different amount and it’s quite frankly making it up as you go along.
The badge on the left has been awarded to Cheltenham Tax Accountants for being champions of clear and transparent pricing. What that means is that we don’t make our prices up from client to client and we actually show you a breakdown of our fees line by line for the exact services you have asked for. I will now dive into the detail…
We charge for preparing a set of accounts based largely around three different factors.
- Whether are you self-employed or a limited company
- The size of the business (measured by your annual turnover)
- The quality and type of your bookkeeping system / records.
I will give you some guideline figures to get an idea of our fees in this area. We charge £18+vat for per month for a self-employed person’s accounts with a turnover between £10k to £30k where the ‘books’ are kept on a simple spreadsheet (we can provide a template for this). You will also need to add on £13+vat per month for the actual completion and submission of your self-assessment tax return, so the TOTAL FEE all in would be £31+vat per month (£37.20 including VAT). Be careful to include the VAT on any fees if you are not a VAT registered business yourself (where you can claim it back).
Limited company example:
A limited company set of accounts has far more requirements than a sole trader / self-employed person. I won’t bore you with the full details but these needs to be submitted to Companies House and must comply with more rigorous accounting rules. You must have a more complete bookkeeping system to enable the completion of these accounts also. If you have a limited company with a turnover between £10k to £30k (or you are a contractor) then the fees for the accounts are £59+vat per month, if the revenue is £30k to £80k then this increases to £79+vat and it goes up slightly depending on the size of the business.
The thing with a limited company is that there are several other services you are likely to require. The standard ones will be your personal tax return for £13+vat p/m and potentially the management and submission of a PAYE scheme to pay yourself as the director which can be as low as £13+vat p/m. An all inclusive package excluding bookkeeping and VAT returns would be in the region of £90 to £120+vat p/m.
This is a whole new area for businesses and is something that you as the business owner could potentially do yourself. We even provide training for you to do it yourself! To give it the justice it needs we will explain how we charge for bookkeeping in part 2 of our ‘How much does an accountant cost / charge in the UK?’ series. Please note that the fees above to not accounts for bookkeeping and assume that you either have very little transactions or you complete your own bookkeeping currently.
In the meantime please view our pricing page for some more example fees.