How much does an accountant cost for a small business?
In this article, we'll cover:
What does an accountant do?
Having an accountant is a great help for tradespeople. Accountants range from unqualified bookkeepers to those with professional qualifications.
As well as handling your accounts and tax returns they can also offer helpful business advice.
However, it’s worth noting that accountants are different to financial advisors.
How much do accountants charge for tax returns?
Accountants also help you save money on your tax bill. In fact, tradespeople often use accountants to do their self-assessment tax returns. So, self-assessment accountant fees will vary.
Or if you run your business as a limited company, an accountant can handle your company tax returns.
Choosing an accountant
The first question to ask yourself is “what is the cost of a small business accountant?”
That’s why it’s important to do your own research. Especially if you don’t know how much an accountant costs.
So, make sure you compare different accountants and their customer reviews.
You’ll want to:
- Find a qualified accountant that’s local to you. They will be pre-vetted and quality-assured. You can search in England and Wales, Scotland and Ireland
- Ask other known tradespeople to recommend an accountant that they rate highly
Other ways to find accountants include:
- Local business directories
- Online searches
Make sure you shop around to find an account that matches your needs. As with any service, the quality you receive can vary.
Speak to a number of accountants to compare their costs and services.
Yes, your decision should depend on how much an accountant costs, but also whether you like them!
What do accountants base their costs on?
How much an accountant charges their clients depends on several factors. These include:
- Your annual turnover or income
- How organised your business records are — you can help keep the accountant’s costs down by keeping good records
- The size of your business — how many staff, premises, vehicles and customers you have and how much work you do each year
Remember, the cost of an accountant for a small business will usually be lower.
How much does an accountant cost per year?
Many accountants will provide a fixed annual cost for carrying out certain regular tasks.
This can include preparing and submitting your tax returns to HMRC. And the same can be done for your annual business accounts.
Accountants can also provide more specialised services. For example, handling disputes and claiming refunds from HMRC.
Cost vs quality
You’ll have to balance the cost with the quality of the service you receive.
For instance, paying low accountant fees for your small business could mean the quality of work might not be as good.
So, research the exact cost of an accountant for a small business using comparison websites like:
Accountants for tax returns
If you’re a self-employed sole trader or run a limited company, you’ll have to submit tax returns to HMRC.
Tax return accountant costs are usually charged as a one-off fee for the year.
But this fee can be higher if your income stream is unpredictable.
Why? Because the tax returns will be more complex for the accountant to produce. Therefore, they’ll take longer to do!
So, it makes sense to keep accurate records of your income and expenditure. This means you have all the information the accountant needs.
HMRC charges penalties for late submissions of tax returns. So, do yours in good time.
By identifying ways to decrease your tax bill, your accountant could save you money in the long run.
Accountants for small business
Apart from tax returns, small businesses often rely on their accountant to carry out a number of other tasks.
These can usually be combined as a package of services.
The cost of an accountant for small businesses varies depending on the services you use.
These could include:
- Corporation tax — this is the tax that limited companies pay
- VAT returns — here’s what you need to know about VAT
- Payroll – this is how you pay your employees
- Annual accounts – this usually includes a . For instance, a profit and loss statement
- Cash flow management — here are some tips on improving cash flow and avoiding cash flow problems
Paying for other services
Accountants don’t necessarily have to be paid annually or monthly. You might want to pay them per hour for certain services, for example.
This just depends on how often your business needs them.
Rather than committing to monthly charges, hourly payments can give you more flexibility to pick and choose.
Additional services from accountants could include:
- Basic bookkeeping services — this should be competitively priced by accountants since it’s such a popular service
- More specialised work, like business planning advice — this service will cost a lot more, as it’s more advisory
Accountant fees FAQs
How much does an accountant cost per year?
The cost of an accountant depends on what, and how much, you need from them.
This could include your tax returns, business accounts and other financial services.
What is the cost for an accountant for small business?
Accountant fees for small businesses will vary. And this will depend on if you’re a sole trader or limited company.
If you’re getting an accountant for sole trader purposes, it’s best to discuss what you need with them.
Then, they can provide you with an accurate cost for their services.
What should I look out for when choosing an accountant?
Considering the cost of an accountant for a small business is important.
Also, you’ll want an accountant who’s in tune with your needs. That way, they can help you to grow your business.
DISCLAIMER
This is information – not financial advice or recommendation. The content and materials featured or linked to on this blog are for your information and education only and are not intended to address your particular personal requirements. The information does not constitute financial advice or recommendation and should not be considered as such. Checkatrade website is not regulated by the Financial Conduct Authority (FCA), its authors are not financial advisors, and it is therefore not authorised to offer financial advice.
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