Keeping your accounts up to date and your tax returns submitted on time are vital requirements for all businesses. Whether you are a sole trader or in charge of a multi-national corporation, there is always the need to fulfil basic accounting requirements. The main issue companies face is the realisation that accounting can be time-consuming and highly confusing. Many businesses worry that they will inadvertently fail to submit the correct information or lose track of their bookkeeping, and their accounts will become complicated and messy. There are many pitfalls to avoid when trying to manage your accounts, which is why so many companies choose to hire an accountant. Let’s face it, you already have enough to do when it comes to the day-to-day running of your business, and you certainly don’t have time to add the role of the bookkeeper to your job description.
While many companies would like to bring an accountant on board to take care of their bookkeeping and handle their tax returns, the idea of paying for someone to do this can be off-putting. Wondering how much it would cost to use an accounting service in the UK? If so, this blog post will help you get a better idea of the costs involved in using an accounting service.
Which accounting services do you need?
The cost of your accounting services will depend very much on the size of the business you operate and its annual turnover. The more support you need, the more expensive the accounting service will be. For example, a sole trader with an annual turnover of less than £50k will pay less than a company with a yearly turnover of £1 million and numerous employees. If your business does not pay VAT, you will pay less for your accounting services than a company that exceeds the VAT threshold.
The cost of accounting services
So, what you want to know is precisely how much can you expect to pay for your accounting services in the UK. Well, most accounting services charge a monthly fee that is based on the level of support that you need, how large your company is, the type of company that you run, e.g. limited company, and the size of your annual turnover. Keeping all of these variables in mind, it is likely you will still notice variations in price between different accounting companies. To give you a loose indication of the cost, these figures should give you an idea of how much you can expect to pay:
If you are a sole trader with an annual turnover below £50k, you could pay anywhere between £50 and £100 per month for accounting services. If you run a limited company and have an annual turnover that is below the VAT threshold, so you are not VAT registered, you could expect to pay up to £150 per month for your accounting to be handled on your behalf.
If you run a limited company with an annual turnover of up to £5 million, you could expect to pay up to £1,500 per month for your accounting services. When enquiring about the cost of accounting services, don’t forget to ask if VAT is included in the monthly figure or if it is charged in addition to the monthly fee.
How to select the best accounting services for your business
It is worth noting that the prices of different accounting services vary from company to company. If you choose an accounting service based solely on price, you could find yourself with a service that does not meet your business’s needs. Choosing a cheaper accounting service that does not perform all the roles you need would be a false economy. While cost may be a deciding factor when selecting an accounting service, it should not be the only reason for your choice. Your accounts and tax obligations are a crucial part of running your business, so you need an accounting service you can depend on to act on your behalf and take care of these matters for you. Finding an accounting service that is a good fit for your business will make your life so much easier, so it is worth doing your research to find the best option for your company.
There are so many benefits when using an accounting service that is tailored to meet your business’s needs. Having the support of an accounting service when you need it is invaluable and far more cost-effective than recruiting an in-house accounts team.