Hiring an accountant is a crucial decision for individuals and businesses alike, yet many are left asking the same question, how much do accountants charge in the UK? The answer isn’t always straightforward. Fees can vary significantly depending on the services required, the complexity of your financial affairs, your business structure, and even your location.
In this guide, we’ll provide a detailed breakdown of accountant fees across the UK, helping you understand what influences the cost and how to make a cost-effective choice tailored to your needs.
Why Do You Need an Accountant in the First Place?
Accountants do far more than just file tax returns. Their role spans multiple aspects of financial management, from helping with compliance to providing strategic financial advice.
Whether you’re a sole trader, a limited company director, or a landlord with rental income, working with a professional accountant ensures your financial obligations are met accurately and efficiently.
- Prepare and file statutory accounts
- Submit Self Assessment or Corporation Tax returns
- Handle VAT and PAYE
- Maintain accurate bookkeeping records
- Advise on tax efficiency
- Stay compliant with HMRC and Making Tax Digital (MTD) regulations
Their support is especially critical for small business owners who may lack the time or expertise to manage complex financial tasks.
What Are the Average Accountant Fees in the UK?
The cost of hiring an accountant depends on various factors, but averages give a useful benchmark. In the UK, typical annual costs for accounting services are as follows:
| Client Type | Average Annual Fee Range |
| Sole Trader | £500 – £1,200 |
| Limited Company (Basic) | £600 – £1,500 |
| Limited Company (Full Service) | £1,000 – £3,500 |
| Start-Up Business | £300 – £800 |
Monthly retainers are commonly used for ongoing services and may include bookkeeping, payroll, and quarterly VAT returns. These packages typically start at £50 per month for sole traders and can exceed £200 for more complex businesses.
How Much Does an Accountant Cost for Self-Assessment and Tax Returns?
One of the most common reasons individuals and small business owners seek an accountant is to handle their Self Assessment tax return. These services are typically billed as a one-off fee.
Self-Assessment for Simple Income:
For individuals with a single source of income or straightforward employment/self-employment, accountants may charge between £150 and £300.
Complex Self-Assessment Returns:
For more complex cases involving multiple income streams, rental properties, capital gains, or overseas income, fees may rise to £400 – £500 or more.
| Self-Assessment Complexity | Estimated Fee |
| :Basic Employment Income | £150 – £200 |
| Sole Trader or Freelancer | £200 – £300 |
| Multiple Income Streams | £300 – £500+ |
Hiring an accountant for your tax return is not just about form-filling. A good accountant can identify tax-saving opportunities, reduce the risk of errors, and help avoid penalties.
What Do Accountants Typically Charge for Ongoing Bookkeeping?
Bookkeeping fees are usually charged separately from tax return services, particularly if you require regular transaction tracking, invoicing, and bank reconciliation.
Depending on the volume of transactions, expect to pay:
- £20 – £50 per hour for ad hoc bookkeeping
- £100 – £400 per month for ongoing bookkeeping support
Businesses with cloud-based accounting systems like Xero, QuickBooks, or FreeAgent often receive lower quotes due to the automation benefits these platforms provide.
Factors That Affect Bookkeeping Cost
- Number of transactions per month
- Whether VAT is involved
- Need for accounts receivable/payable management
- Use of accounting software
For small businesses, bundling bookkeeping with year-end accounting can offer cost savings and streamline your financial operations.
How Much Do Payroll, VAT Returns, and Other Services Cost?
Beyond bookkeeping and tax returns, many businesses require additional services such as payroll management and VAT filing. These are often charged separately or included in monthly packages.
| Service | Typical Cost |
| Payroll (Per Employee) | £5 – £10 per month |
| Payroll (Up to 10 staff) | £25 – £100 per month |
| VAT Return | £75 – £200 per quarter |
| Corporation Tax Return | £250 – £600 annually |
| Business Advice | £75 – £150 per hour |
If your business is VAT registered or employs staff, expect these additional costs as part of your monthly or annual accounting budget.
What Factors Influence How Much an Accountant Charges in the UK?
Not all accounting fees are created equal. The cost you’ll be quoted can depend on a number of practical variables:
Business Complexity
The more complex your finances, the higher the fees. A sole trader with straightforward transactions pays less than a limited company with multiple income streams, employees, and VAT obligations.
Location
Accountants based in London or the South East tend to charge higher rates due to increased overheads. A sole trader may pay £800 – £1,200 annually in London compared to £500 – £800 in other parts of the UK.
Volume of Work
Large volumes of transactions, payroll requirements, and multiple bank accounts increase workload, which translates to higher fees.
Experience and Qualifications
Chartered accountants or firms with specialist tax knowledge may command higher fees but also provide more comprehensive support and peace of mind.
Should You Choose Hourly, Monthly, or Per-Service Billing?
When hiring an accountant, choosing the right billing method is as important as the cost itself. Most accountants offer three main options: hourly, monthly, or per-service billing.
Hourly rates are common for one-off consultations or problem-solving, usually ranging from £35 to £60 per hour, with higher rates for specialist advice.
Fixed monthly packages provide predictable costs and are ideal for ongoing support such as bookkeeping, VAT returns, payroll, and year-end accounts, typically costing between £50 and £300.
Per-service fees suit those needing specific tasks like a tax return or VAT filing, though costs can add up if used frequently. Many accountants allow clients to adjust or switch billing methods as their business needs change.
Can Accountants Actually Save You Money?
The cost of an accountant is often outweighed by the value they bring. Many business owners discover that, far from being just a cost, accountants are essential in reducing tax bills and improving financial efficiency.
They can help you:
- Identify tax deductions you may have overlooked
- Avoid costly HMRC fines
- Structure your business in a tax-efficient way
- Improve cash flow forecasting and budgeting
- Navigate VAT thresholds and registration requirements
Ultimately, good advice can often pay for itself, many clients save more in tax than they spend in fees.
How to Choose the Right Accountant for Your Business Needs?
Choosing the right accountant is about more than just comparing fees, it’s about finding a partner who understands your business needs and supports your growth. A good accountant can simplify finances, reduce stress, and improve efficiency.
Key Factors to Consider:
- Qualifications: Ensure they’re certified by bodies like ACCA or ICAEW and have experience in your industry.
- Technology Compatibility: Choose someone who works with your preferred cloud accounting software.
- Communication & Support: Look for responsiveness and proactive guidance, not just reactive service.
- Transparent Pricing: Request a clear quote detailing what’s included to avoid hidden fees.
Taking time to evaluate these factors will help you build a reliable, long-term partnership that benefits your business financially and operationally
What Is the Cost of Not Hiring a Good Accountant?
While DIY accounting or hiring the cheapest option may seem tempting, it often comes at a hidden cost. Poorly managed accounts can lead to:
- HMRC penalties for late or inaccurate submissions
- Missed tax-saving opportunities
- Inability to secure funding due to poor financial records
- Higher costs later to fix past mistakes
An unqualified or inattentive accountant may cost less upfront, but the long-term impact can be far more expensive.
Conclusion
Understanding how much accountants charge in the UK is about more than comparing numbers. It’s about evaluating value, the peace of mind, time saved, and strategic insights a skilled accountant provides.
From basic tax returns to comprehensive financial management, accountant fees vary widely. However, by knowing the average costs, the factors that influence pricing, and the billing structures available, you can make an informed decision that suits your business needs and budget.
Invest wisely in accounting support, and it can become one of the most valuable assets to your financial success.
Frequently Asked Questions
What’s the difference between a bookkeeper and an accountant?
A bookkeeper handles day-to-day financial records, such as receipts, expenses, and bank transactions. An accountant provides higher-level financial advice, tax planning, and regulatory compliance support.
Are all accountants in the UK qualified or regulated?
No. While many are certified by professional bodies like ACCA or ICAEW, some operate without formal regulation. It’s essential to verify credentials before hiring.
How can small businesses reduce their accounting costs?
Maintain clear records, use cloud accounting software, and opt for fixed-fee packages that bundle essential services.
Can you switch accountants mid-year?
Yes, you can switch accountants at any point, though it’s ideal to do so after filing your year-end accounts to avoid confusion and overlap.
What does Making Tax Digital mean for accounting fees?
MTD requires businesses to maintain digital records and submit tax returns electronically, often increasing the need for software-compatible accountants.
Is it better to hire a local accountant or go online?
Online accountants are often more affordable and tech-driven, while local firms may provide more personalised support. The best choice depends on your preferences and business needs.
Can an accountant help with HMRC investigations or audits?
Yes, most qualified accountants can assist during investigations, ensuring correct documentation, representation, and compliance with HMRC requirements.
