Outsourcing accounting is becoming more popular with small businesses, contractors, and growing companies across the UK. Many business owners find that keeping their books clean takes more time than they expected, and using an outside accountant often gives them better accuracy, less stress, and predictable costs.
In the UK, outsourced accounting typically starts from £80 to £350 per month for small businesses, around £400 to £1,500 per month for mid-sized firms, and can range from £2,000 to £6,000 per month for companies with higher turnover or complex needs.
But how much does outsourced accounting actually cost for your type of business, and what affects the price? This guide explains everything in simple terms so you can make the right choice for your business.
Quick Cost Overview of Outsourced Accounting Services in UK
Below is a simple breakdown of the typical prices businesses pay when outsourcing their accounting. These are average UK price ranges to give you a clear starting point.
|
Service Category |
Typical Price Range (UK) |
Details |
|
Basic bookkeeping |
£100 – £800 per month |
Covers day to day bookkeeping, bank reconciliation, posting invoices, and basic monthly reports. Ideal for sole traders and small limited companies. |
|
Monthly accounts and VAT returns |
£150 – £600 per month |
Includes VAT preparation, Making Tax Digital compliance, and quarterly submissions. |
|
Payroll processing |
£4 – £8 per payslip or £40 – £120 per month |
Depends on employee numbers, payroll frequency and pension duties. |
|
Tax preparation and filing |
£150 – £1,200+ per year |
Varies based on business size, structure and filing complexity. |
|
Accounts payable and receivable support |
£200 – £2,000+ per month |
Cost depends on transaction volume, invoicing, payment processing and credit control. |
|
Management accounts |
£250 – £1,500+ per month |
Regular financial reports, budgeting and cash flow support for growing businesses. |
|
Year end accounts and compliance |
£600 – £3,000+ per year |
Covers statutory accounts, Corporation Tax returns and Companies House filing. |
|
Fractional or part time CFO or FD |
£1,000 – £5,000+ per month |
High level financial strategy, forecasting, planning and board reporting. |
|
Full service outsourced finance function |
£800 – £6,000+ per month |
Complete finance department support, including bookkeeping, payroll, VAT, reporting and advice. |
Note: Prices vary depending on the level of service, size of your business, and the complexity of your accounting needs. If your business grows or requires specialist support, costs may shift accordingly.
How Much Outsourced Accounting Services Costs For Different Type Of Businesses In UK
Outsourcing is usually much cheaper because you only pay for the services you need. You avoid the cost of salaries, training, equipment, holiday cover, and software subscriptions.
Below are typical UK price ranges.
Costs for small businesses
Small businesses cost:
£50 to £500 per month
Depending on services such as:
- Bookkeeping
- VAT returns
- Payroll Outsourcing
- Year end accounts
- Self assessment
This is far lower than hiring even a part-time bookkeeper.
Costs for mid-sized firms
Mid-sized firms with regular transactions usually cost:
£500 to £2,000 per month
This may include:
- Weekly bookkeeping
- Payroll for 10 to 40 employees
- Management accounts
- Budgeting
- VAT
- Monthly reporting
This gives them a full finance function without the cost of hiring staff.
Costs for businesses turning over up to £500k
Typical monthly cost:
£150 to £600
Services usually include:
- Basic bookkeeping
- VAT
- Year end accounts
- Payroll for small teams
This level of support is ideal for small trades, shops, and service providers.
Costs for businesses turning over £2 million
Typical monthly cost:
£800 to £2,500
This usually includes:
- Weekly bookkeeping
- Payroll
- Credit control
- Management accounts
- Cash flow reports
- Regular meetings
This gives growing businesses the financial visibility they need without a full-time employee.
Costs for businesses turning over £5 million
Typical monthly cost:
£2,000 to £5,000
This often includes:
- A dedicated accounting team
- Advanced reporting
- Forecasting
- Strategic financial management
- Full monthly management accounts
Many companies at this level choose outsourced services instead of building a full internal team.
Costs for businesses turning over £10 million
Typical monthly cost:
£4,000 to £8,000+
Businesses at this turnover level may need:
- A full outsourced finance function
- A part-time finance director
- Real-time reporting
- Multiple payrolls
- VAT support
- Internal controls
Even at this size, outsourcing is often 40 to 60 percent cheaper than building an in-house finance department.
What does it mean to outsource accounting and bookkeeping?
Outsourced accounting and/or bookkeeping means handing your financial tasks to a qualified accounting service rather than doing them yourself or hiring a full in-house accountant. Many UK businesses choose this option because it is often cheaper and more reliable than hiring staff.
When you outsource your accounting, you allow an external accountant or accounting team to manage tasks like:
- Bookkeeping
- Payroll
- VAT returns
- Year end accounts
- Self assessment
- Management accounts
- CIS returns
- Credit control
- Financial reporting
You can outsource a few tasks or your full finance function. The work is usually handled by trained accountants in London who follow HMRC rules and deadlines. You pay for the specific services you choose, which makes costs predictable.
Which types of businesses typically outsource their accounting?
Outsourcing is common across many business types, especially:
- Small limited companies
- Sole traders
- Startups and new businesses
- Online shops and e-commerce brands
- Construction firms that deal with CIS
- Hospitality and retail businesses
- Trades and local service providers
- Growing companies that cannot justify hiring a full-time finance team
These businesses often find that a flexible external accountant can support them better than managing accounts alone.
Should you outsource all accounting functions?
You do not need to outsource everything. Many businesses choose to keep simple tasks in-house and outsource more technical work.
You can choose from:
- Partial outsourcing
For example, you keep daily invoicing in-house but outsource VAT and year end accounts. - Full outsourcing
Your accountant manages everything, from bookkeeping to payroll to reporting. - Hybrid support
Your business handles the admin and your accountant checks and finalises the figures.
The right choice depends on your time, budget, skills, and the complexity of your financial work.
How Outsourcing Companies Price Their Services
Outsourcing providers use different pricing styles. Understanding these helps you pick the one that fits your business and avoids hidden costs.
Ad hoc or pay-as-you-go model
This is the most flexible option. You only pay for the specific tasks you need, when you need them.
Suitable for:
- Very small businesses
- Sole traders
- Companies with irregular accounting needs
Typical ad hoc tasks include filing a single VAT return, preparing year end accounts, or one-off bookkeeping catch-up work.
Pros:
- No long contracts
- You only pay for completed work
Cons:
- Can be more expensive per task
- Harder to predict long-term costs
Full-time employee or dedicated resource model
This model offers a full-time accountant or bookkeeper who works only for your business. They may work remotely but act like part of your in-house team.
Suitable for:
- Medium and large companies
- Fast-growing startups
- Firms with constant bookkeeping and payroll tasks
You pay a fixed monthly fee, which is normally lower than hiring a UK full-time employee.
Block-of-hours model
Here, you buy a set number of hours each month. The accountant uses this time to complete your bookkeeping, VAT, payroll, or other tasks.
Suitable for:
- Businesses with regular tasks
- Companies that need predictable monthly billing
Pros:
- Fixed pricing
- Easy budgeting
Cons:
- Unused hours may not roll over
- Harder to manage if workload varies a lot
Onshore support solutions
This means your outsourced team is based in the UK. It usually costs more but comes with benefits like:
- Better understanding of UK tax law
- Easier communication
- Faster response times
Useful for businesses that need close support or deal with complex UK tax issues.
Practice outsourcing solutions
This is used mainly by accountancy firms that outsource some of their own internal work. While not aimed at business owners directly, it affects pricing if your accountant uses outsourced labour behind the scenes.
Managed full-time employee (FTE) solutions
This option gives you a dedicated accountant, but they are fully managed by the outsourcing firm. They handle:
- Training
- Quality control
- Work allocation
- Deadlines
Your business receives consistent support while avoiding the cost of hiring and managing staff.
Pricing models in outsourcing accounting services
Common pricing structures include:
- Fixed monthly packages
Ideal for ongoing bookkeeping and compliance tasks. - Hourly rates
Used for complex or irregular work. - Project-based pricing
Often used for year end accounts or a bookkeeping clean-up project. - Tiered plans
Packages with different levels of service, such as basic, standard, and premium.
Each model has its own pros and cons. The right one depends on how predictable your accounting needs are.
Engagement Models for Outsourcing
Choosing the right engagement model helps you control cost, service quality, and flexibility.
What is an engagement model in outsourcing?
An engagement model is the structure that defines:
- How you work with the outsourced accountant
- What services are included
- How communication happens
- How pricing is calculated
- How long the contract lasts
It acts like a service agreement that outlines roles and responsibilities.
Examples include:
- Fixed monthly support
- Project-only support
- Hybrid or shared work model
- Dedicated accountant model
How to choose the right outsourcing model
To choose the best fit, consider:
- Your budget
If cost control is important, fixed or block-hour packages work well. - Your internal skills
If you struggle with bookkeeping or VAT, full support may be better. - Your growth plans
Growing companies may need scalable packages that can be increased easily. - The complexity of your accounts
Some industries need more detailed support. - Your preferred style of working
Some businesses prefer constant communication, while others need simple compliance only.
A good provider will always explain the model to you before you sign a contract.
What Influences the Cost of Outsourcing Accounting Services
Many factors affect the price you pay for outsourced accounting. Knowing these helps you compare quotes fairly and avoid hidden fees.
What services you need
The more services you want, the higher the cost. Basic bookkeeping is usually the lowest priced, while specialist tasks cost more.
Lower-cost tasks:
- Bank reconciliations
- Sales and expense entry
- Simple VAT filing
Moderate-cost tasks:
- Payroll
- Management accounts
- CIS support
Higher-cost tasks:
- Year end accounts
- Tax planning
- Cash flow forecasting
- Complex VAT work
Business size and complexity
Larger businesses usually pay more because they have:
- More transactions
- Multiple revenue streams
- More staff
- More reporting requirements
A small service-based business may only need 3–5 hours of bookkeeping per month, while a busy retail shop might need daily work.
Industry-specific expertise
Some industries need accountants with specialist knowledge, for example:
- Construction
- Hospitality
- Healthcare
- Creative industries
- Property and rental businesses
- Charities
These sectors may need extra compliance work, which can increase cost slightly.
Level of expertise required
Junior bookkeepers cost less than qualified accountants. If your accounts need technical review or tax advice, the price increases.
The more complex your transactions, the more qualified your accountant needs to be.
Technology and software costs
Software can affect the cost, especially if you require:
- Cloud bookkeeping systems
- Stock systems
- Payroll software
- Timesheet tools
- App integrations
Many accounting firms include software costs in their monthly packages, which saves you money.
Frequency of support
More frequent support increases the cost:
- Weekly bookkeeping is more expensive than
- Monthly bookkeeping, which is more expensive than
- Quarterly bookkeeping
Choose a frequency that suits how quickly your business needs up-to-date records.
Location and market rates
Prices vary across the UK. London and the South East often have higher accounting rates than other areas. Some firms offer national pricing, which can be more affordable.
Contract terms and service agreements
Longer contracts sometimes offer better pricing.
Month-to-month agreements give you flexibility but may cost slightly more.
Clear service agreements should include:
- What is covered
- What counts as extra work
- Response times
- Reporting style
This avoids misunderstandings and surprise fees.
Services included
Some firms offer all-inclusive packages. Others charge extra for:
- Payroll
- VAT
- Year end filings
- Software subscriptions
- CIS
- Reports
Always check exactly what is included in your quote.
Specialist expertise
Specialist work such as R&D claims, tax planning, or complex VAT issues can raise the overall cost.
These tasks need advanced knowledge and carry higher compliance risk, so they cost more.
Factors influencing cost of outsourcing accountants
To summarise, the final cost is shaped by:
- Volume of work
- Technical difficulty
- Your industry
- Frequency of support
- Type of pricing model
- Contract length
- Level of expertise required
Most small UK businesses pay somewhere between £50 and £500 per month for outsourced accounting, depending on their needs.
Larger companies or those with complex accounts may pay more.
Cost Comparison: In-House vs Outsourced Accounting
One of the biggest decisions for any business is whether to build an internal finance team or outsource accounting to an external provider. While hiring staff may seem like a long-term solution, it comes with a wide range of hidden costs that many business owners do not expect.
Outsourcing, on the other hand, offers flexible pricing and access to trained accountants without the full employment costs.
Below is a clear comparison so you can understand the true financial difference.
The true cost of hiring accountants in-house
Hiring an accountant or bookkeeper internally involves much more than just paying a salary. You must also consider:
- Employer National Insurance
- Pension contributions
- Holiday pay
- Sick pay
- Training and CPD
- Office space if on-site
- Software licences
- Recruitment costs
- Equipment such as laptops
- Payroll processing costs
These additional costs often add 25 to 40 percent on top of the base salary. For some roles, the total annual cost can be thousands more than expected.
Internal staff also require management, regular reviews, and ongoing support, which take time away from running your business.
How much would it cost to hire internally?
Below are typical UK salary ranges for common finance roles. Note that London and the South East usually sit at the higher end.
Financial manager
A financial manager oversees reporting, budgeting, cash flow, and financial strategy.
- Typical UK salary: £45,000 to £70,000 per year
- Total cost with NI, pension, and employer overheads: £57,000 to £90,000+
This role is usually suited for larger companies or businesses with complex financial needs.
Finance director
A finance director (FD) handles high-level strategy, forecasting and leadership.
- Typical UK salary: £80,000 to £120,000+ per year
- Total cost to employer: £104,000 to £150,000+
Most small businesses cannot justify this expense and instead rely on part-time external FD support.
Bookkeeper
A bookkeeper manages daily entries, bank reconciliation, and basic records.
- Typical UK salary: £22,000 to £32,000 per year
- Total cost to employer: £28,000 to £40,000
Even though this is the lowest-cost role in the finance department, you still face additional expenses for training and software.
Credit controller
This role manages overdue payments and follows up with customers to improve cash flow.
- Typical UK salary: £25,000 to £35,000 per year
- Total employer cost: £31,000 to £44,000
Late payments are one of the biggest issues in UK business, so this role can be important — but also expensive.
Sales ledger clerk
A sales ledger clerk deals with invoicing, receipts, and customer accounts.
- Typical UK salary: £22,000 to £30,000
- Total employer cost: £28,000 to £38,000
Many businesses outsource this role because it is repetitive and easy to handle externally.
How much could a finance team cost at different sizes?
Below is an example of what a typical UK business might pay for an internal finance department.
Basic set-up
Suitable for a small business with simple needs:
- 1 bookkeeper
Total annual cost: £28,000 to £40,000
This team may struggle with VAT, tax planning, and reporting.
Mid-level
Suitable for growing businesses:
- Bookkeeper
- Part-time accountant
Total annual cost: £45,000 to £65,000
This gives a balance of admin and technical support.
Growing team
Suitable for businesses with higher turnover and more activity:
- Full-time bookkeeper
- Accountant
- Credit controller
Total annual cost: £75,000 to £110,000
This team can handle most daily finance tasks, but may still need external tax support.
Full in-house team
Common for firms with complex operations:
- Bookkeeper
- Management accountant
- Credit controller
- Finance manager
Total annual cost: £140,000 to £200,000+
This is a major financial commitment and often more than most small or medium businesses need.
Advantages of Outsourcing Accounting
Outsourcing offers a wide range of benefits that go beyond cost savings. Many business owners say it reduces stress and helps them make better decisions.
Saving time
Managing accounts takes hours every week. Outsourcing gives you that time back so you can focus on running and growing your business instead of entering receipts or preparing payroll.
Saving costs
Outsourcing avoids:
- Salaries
- Employer NI
- Pension contributions
- Training costs
- Software fees
- Recruitment
For most businesses, outsourcing costs less than hiring even one junior bookkeeper.
Access to experts
You gain access to:
- Bookkeepers
- Payroll specialists
- Tax experts
- VAT advisers
- Finance managers
Instead of hiring multiple staff, you have a full team of trained professionals available when needed.
Improving operational efficiency
With outsourced accounting, your books are kept up to date consistently.
You receive:
- Clean records
- Clear reports
- Better cash flow tracking
- Accurate invoices and payments
This makes your whole business run more smoothly.
Accuracy and compliance
Professional accountants ensure:
- VAT is filed correctly
- Payroll follows HMRC rules
- Deadlines are met
- Year end accounts are accurate
- Tax savings are not missed
This reduces errors and helps avoid penalties.
Time back to focus on your business
When someone else handles the financial admin, you can dedicate time to:
- Winning more clients
- Managing operations
- Improving products
- Training staff
- Planning for growth
Business owners often feel relieved when they no longer have to deal with bookkeeping piles.
Tax efficiency and savings
Good accountants help you:
- Claim all allowable expenses
- Use the correct VAT scheme
- Improve cash flow
- Plan taxes in advance
- Reduce your overall tax liability legally
These savings often cover the cost of outsourcing.
Better financial insight
Outsourcing provides access to monthly or weekly reports that help you understand:
- Profit
- Cash flow
- Costs
- Sales trends
- Budget performance
This gives you better control over your business and clearer decision-making.
Peace of mind
Knowing that trained professionals are handling your accounts reduces stress.
You do not have to worry about:
- Missed deadlines
- Incorrect VAT
- Late payroll
- Tax errors
- Missing receipts
Everything is taken care of, giving you confidence that your finances are in safe hands.
Disadvantages of Outsourcing Accounting
While outsourcing has many advantages, it is not without drawbacks. Some businesses worry about losing control, adjusting to new processes, or relying on external teams. Understanding the potential disadvantages will help you create a setup that works smoothly and avoids common issues.
Service quality concerns
Not all outsourcing providers offer the same level of quality. Some may not review your records carefully or may use junior staff for key tasks. This can lead to errors, slow responses or outdated reporting. To avoid this, it is important to work with a provider that offers clear standards, trained staff and consistent communication.
Confidentiality and security risks
When you outsource your accounts, you are trusting another organisation with sensitive financial data. If they do not have strong data protection measures, there could be risks around security, privacy and system access. Reputable firms use secure portals, encrypted software and strict internal controls to protect client information.
Management challenges
You still need to oversee the work, even if an external team is handling the day to day tasks. This means reviewing reports, approving payments and sharing documents on time. Some businesses expect outsourcing to be completely hands off, but the best results come when clients maintain regular contact and provide updates when needed.
Flexibility issues
Outsourced services usually work to set schedules and defined scopes of work. If you need urgent support, last minute changes or additional tasks, the provider may need extra time or may charge additional fees. Internal staff can sometimes respond quicker, so businesses should choose an outsourcing partner that offers flexible service levels.
Meeting regulatory requirements
Your provider must stay up to date with HMRC rules, VAT changes and accounting standards. If the outsourced team does not follow current regulations, your business could face errors or penalties. Choosing a firm with proper training, quality checks and a strong understanding of UK accounting helps reduce this risk.
Steps to Minimise Outsource Accounting Costs
Outsourcing should save you money, but only if the service is managed well. Many businesses reduce their costs by streamlining tasks, setting clear expectations and choosing a package that fits their needs.
Prioritising value over cost
It is tempting to choose the cheapest option, but low-cost providers often cut corners or offer limited support. Instead of focusing only on price, look at the level of experience, range of services and the quality of reporting offered. A reliable accountant often saves you more money than a cheaper alternative.
Avoiding unexpected fees
To prevent surprise charges, make sure you understand what is included in your package. Some firms charge extra for payroll, VAT, amendments or additional queries. Asking for a full breakdown of services at the start helps you avoid misunderstandings later. A fixed-fee agreement gives more clarity and stability.
Managing communication gaps
Communication can affect the cost and efficiency of your outsourced service. Slow responses, missing paperwork or unclear instructions can lead to extra time and additional fees. Setting clear contact points and sharing documents on time helps keep your costs down and ensures the work is completed smoothly.
Avoiding data security risks
Using secure systems protects your business and prevents costly issues. Choose accountants who use encrypted software, safe document upload portals and strong cyber security practices. This reduces the risk of breaches, which can be expensive and damaging to your reputation.
Ensuring scalable services
As your business grows, your accounting needs will change. Make sure your outsourced provider can scale with you by offering flexible service levels, additional support and more advanced reporting when needed. This prevents you from outgrowing your provider and needing to switch firms later on.
How to Outsource Your Accounting Function
Moving to outsourced accounting may feel like a big shift, but with the right steps it can be simple and smooth. The key is choosing a partner who understands your business and can support your goals.
How to outsource your accounting and bookkeeping functions
Start by assessing which tasks you want to outsource, such as bookkeeping, payroll, VAT or year end accounts. Once you identify your needs, meet with potential providers to discuss your processes and the support you require. The onboarding phase usually includes signing an engagement letter, granting software access and agreeing on deadlines.
Where to find a reliable outsourcing partner
You can look for an outsourcing partner through professional directories, online searches or referrals from other business owners. Look for accountants who specialise in your industry, offer clear pricing and have strong client reviews. A local UK-based accountant may offer better support with HMRC and UK regulations.
How to choose the right accountant for your business
The right accountant should understand your business model, respond promptly and offer clear explanations. Ask about their experience, software skills, team structure and how often they provide updates. It helps to choose a firm that can grow with your business and offer extra support when required.
How to determine whether outsourcing is right for your business
Outsourcing is ideal if you want to save time, reduce costs and improve accuracy without hiring new staff. If you prefer to have direct day to day control, in-house staff may be better. Think about your workload, budget and long term plans. Many businesses use a mix of both, such as outsourcing bookkeeping while keeping some tasks internal.
Key Takeaways: In-house vs Outsourced Finance
When comparing the cost of in-house and outsourced accounting, the difference is often clear. In-house teams provide direct control but come with high salaries, training costs and management responsibility. Outsourced accounting offers expert support, flexibility and cost savings, often at a fraction of the price. The best choice depends on your workload, growth plans and financial goals.
Frequently Asked Questions
What are the benefits of outsourcing accounting services?
Outsourcing saves time, reduces cost and gives you access to experienced professionals. It improves accuracy, supports compliance with HMRC and provides clearer financial insight for decision making.
How do I find the right outsourcing partner?
Look for a firm with strong reviews, clear pricing, industry experience and reliable communication. Meet them to discuss your needs and check whether they understand your business.
What is the typical cost of outsourcing accounting services for a small business?
Most small businesses pay between £50 and £500 per month, depending on the services they need and the complexity of their accounts.
How much does outsourcing accounting services cost per month in the UK?
Monthly costs generally range from £50 to £5,000, depending on business size, transaction volume, payroll needs and reporting requirements.
What factors influence the cost of outsourcing accounting services?
Costs depend on service scope, business size, industry complexity, software needs, reporting frequency and the level of expertise required.
How much does outsourcing cost using offshore vs onshore providers?
Offshore services are often cheaper but may have challenges around communication and time zones. Onshore providers usually cost more but offer better understanding of UK tax rules and easier communication.
How much does outsourcing cost for a mid-sized firm?
A mid-sized firm usually pays £500 to £2,500 per month, depending on the volume of work and the level of financial reporting needed.
What determines the cost of an accountant in the UK?
The cost depends on the accountant’s experience, location, the services included and the complexity of your accounts. Larger cities usually have higher rates.
How much does an accountant cost per month?
Most businesses pay between £50 and £1,000 per month, but costs can be higher for advanced support such as management accounts or cash flow planning.
How much does an accountant cost for a small business in the UK?
Small businesses typically pay £150 to £600 per month, covering bookkeeping, VAT returns, payroll and year end accounts.
How much does an accountant charge for a Self Assessment?
Self Assessment returns usually cost £100 to £350, depending on the complexity of your income and whether you have rental or business earnings.
How much does an accountant cost per hour in the UK?
Hourly rates range from £30 to £100, depending on the level of expertise. Senior accountants and tax specialists often charge more.
Is it worth paying for an accountant?
Yes, most businesses find that an accountant saves them time, reduces errors and helps lower their tax bill. The savings and peace of mind often outweigh the cost.
What is the key cost of outsourcing?
The main cost is the monthly or annual fee for the services you choose. This replaces the need for hiring and managing internal staff.
Is it better to outsource accounting?
For many businesses, yes. Outsourcing is often more affordable, more efficient and more reliable than hiring in-house staff. It gives you expert support and helps your business stay compliant.
