Is Outsourcing cheaper than hiring an In-house accountant? A Guide for Accounting Firms

Ask five accounting firms how much does an accountant cost in the UK, and you'll get five different answers and none of them wrong. Fees vary much for good reason: a sole trader’s self-assessment return and a growing SME’s full management accounts package sit at opposite ends of the same profession, and the work behind each look nothing alike. For firm leaders setting pricing, benchmarking against competitors, or working out where the cost base is heading in 2025 and 2026, the useful question isn’t “what’s the average fee” but “what’s driving the range, and how is that range about to shift.” 

This guide sets out current UK fee benchmarks by service and business type, breaks down what it actually costs a firm to deliver that work, and looks at the specific pressures from the Employer National Insurance rise to Making Tax Digital for Income Tax reshaping the cost structure behind the profession over the next two years.

The Quick Answer

If you need the headline number before the detail, how much does an accountant cost in the UK right now - here’s where fees typically land in 2025/26, before we get into what drives each range.

Service	Typical Range	Billing
Self-assessment tax return	£150 – £800	Per return
Ltd co accounts + Corporation Tax	£600 – £3,500+	Per year
VAT return	£120 – £300	Per quarter
Payroll	£30 – £150	Per month
Monthly bookkeeping	£80 – £400	Per month
All-in package (small ltd co)	£100 – £300	Per month

Figures are illustrative UK market benchmarks for 2025/26

The width of each range is the real story here, and it’s explained section by section below.

What Accountants Charge UK Clients, Service by Service 

Self-assessment remains the entry point for most fee conversations, and it’s also where the range is widest. A return built entirely from employment income and a single savings account sits at the low end of that range; add self-employment, rental property, dividends, or overseas income, and the same return can easily double or triple in price, because each additional schedule brings its own reconciliation work and its own risk if it’s got wrong.

Limited company work follows the same logic but compounds it. Annual accounts and the Corporation Tax return are usually priced as a single package, and the figure that ends up on the invoice reflects transaction volume, the state of the underlying bookkeeping handed over, and whether the company has anything more involved than straightforward trading income R&D claims, multiple income streams, or a group structure all move the fee upward, sometimes substantially.

VAT and payroll tend to be quoted separately and scale more predictably: VAT with transaction volume and scheme (standard, flat rate, or margin), payroll with headcount and pay frequency. Bookkeeping is the most variable line of all, priced anywhere from an hourly rate for occasional catch-up work to a fixed monthly retainer for clients who want the books maintained continuously and it’s increasingly the fixed monthly retainer that firms are steering clients toward, for reasons that have as much to do with cash flow predictability for the firm as convenience for the client. 

Growing SMEs pull accountants into a different kind of relationship entirely. Once a business needs monthly management accounts, cash flow forecasting, or part-time finance director support layered on top of compliance work, pricing shifts from a compliance fee to something closer to a retained advisory relationship and the fee moves accordingly, often into four figures a month rather than three.

Service	Sole Trader	Small Ltd Co	Growing SME
Self-assessment	£150 – £450	—	—
Annual accounts + CT	—	£600 – £1,800	£1,800 – £3,500+
VAT return (quarterly)	£120 – £200	£150 – £250	£250 – £400+
Payroll (monthly)	—	£30 – £80	£80 – £250+
Bookkeeping (monthly)	£80 – £150	£150 – £300	£300 – £600+
Management accounts	—	Add-on service	£200 – £600+

Ranges are indicative and vary by region, transaction volume, and firm positioning

Why Accountant Fees Vary So Much

Understanding how much does an accountant cost in the UK starts with understanding what actually drives the range, and four factors do most of the work. Complexity comes first: the number of transactions, income sources, and reconciling items in a job has more influence on price than almost anything else. Pricing model comes second - fixed fee, hourly, and value-based pricing are three different ways of charging for overlapping work, and they don’t produce the same number for the same job. Firm positioning matters too: a boutique specialist and a high-street generalist are often pricing different things even when the deliverable looks identical on paper, because one is selling judgement and the other is selling throughput. And location still counts, with a London postcode commanding a premium over a regional one for broadly comparable work, though that gap has narrowed as remote service delivery has become normal.

The direction of travel matters more than any single snapshot, though. Fixed-fee and value-based pricing have been steadily displacing the pure hourly rate, partly because clients dislike unpredictable bills, and partly because automation has made time-based billing a poor match for work that increasingly happens inside software rather than in billable hours logged against a task.

The Other Side of the Ledger: What It Costs to Deliver This Work

The True Cost of an In-House Hire

Client-facing fees are one half of the pricing equation. The other half, the question of how much does an accountant cost in the UK to actually employ, rather than to hire as an adviser - gets far less boardroom attention, and the headline salary figure understates it substantially.

Take a qualified accountant on a £40,000 base salary as a working example. Employer National Insurance now runs at 15% above the £5,000 secondary threshold, a rate and threshold that both changed in April 2025, adding roughly £5,250 a year on this salary alone. Auto-enrolment pension contributions add a further layer on top. Then there’s the cost that rarely makes it into a salary benchmarking spreadsheet at all: recruitment, where agency fees routinely run to 15–25% of first-year salary; onboarding and training time; CPD and exam support; software licences; and a share of office overhead. Add it up, and the fully loaded cost of that £40,000 hire typically lands somewhere between £50,000 and £52,000 - an uplift in the region of 25–30% over the number on the offer letter.

Cost Component	Illustrative Annual Amount
Base salary	£40,000
Employer National Insurance (15% above £5,000 threshold)	£5,250
Pension (auto-enrolment, employer contribution)	£1,200
Recruitment, training & overhead (allocated)	£5,000
Fully loaded cost	£51,450

Worked example only. Pension and overhead allocations are illustrative; National Insurance rate and threshold reflect the change effective April 2025

In-House vs Outsourced: A Direct Comparison

This is increasingly the calculation firms run before they recruit, rather than after: what does the fully loaded cost of an in-house hire look like against the cost of sourcing equivalent capacity through an outsourced or offshore delivery model? The honest answer depends heavily on scope, how much oversight and client-facing work stays in-house, how much routine processing moves elsewhere, and which provider and jurisdiction are involved. But the direction is consistent across most of the benchmarking we see: outsourced delivery models tend to bring the all-in cost per unit of capacity down meaningfully against a UK-based hire, particularly once National Insurance, pension, and recruitment costs are weighed against base salary rather than compared to it alone.

Delivery Model	What’s Typically Included	Illustrative Annual Cost (per FTE-equivalent)
In-house hire (fully loaded)	Salary, Employer NI, pension, recruitment, overhead	£50,000 – £52,000+
Outsourced / offshore capacity	Delivery cost, provider management overhead, oversight time retained in-house	Typically lower.

The outsourced figure is directional rather than a quoted rate - actual cost depends on scope, provider, and jurisdiction, and should be benchmarked against specific proposals.

Market Forces Reshaping Accountant Costs in 2025 and 2026

Three changes are doing most of the work in reshaping this picture over the next two years, and none of them are cosmetic.

The Employer National Insurance increase that took effect in April 2025 - the rate rising from 13.8% to 15%, and the secondary threshold dropping from £9,100 to £5,000 - raised the cost of every UK employee, but it hit lower and mid-earners hardest, because the lower threshold means NI now applies to a larger slice of every salary than it did before. For firms with sizeable teams of trainees and junior staff, this alone shifted the in-house cost calculation noticeably, and it’s a large part of why how much does an accountant cost in the UK to employ has become a live boardroom question rather than a background HR detail.

Making Tax Digital for Income Tax adds a different kind of pressure - not to salaries, but to workload. From April 2026, sole traders and landlords with income above £50,000 must keep digital records and submit quarterly updates rather than filing a single annual return; that threshold drops to £30,000 in April 2027, and is due to fall further to £20,000 in April 2028. Four submissions a year instead of one means significantly more client touchpoints, and firms are already recalibrating both fee structures and headcount around that reality.

Layered on top of both is a quieter shift: rising subscription costs from the major practice software platforms, a persistent recruitment squeeze for qualified staff, and a steady move toward automation that’s changing what “billable work” even means. Together, these are pushing firms toward the same question from two directions at once - client fees are under upward pressure, and the cost of the staff needed to deliver the work is rising in step. How a firm resolves that tension, through pricing, through automation, or through a different delivery model, is shaping up to be one of the defining strategic decisions of the next two years.

Frequently Asked Questions

How much does an accountant cost in the UK?

It depends heavily on the service and the complexity behind it, but as a general guide, a straightforward self-assessment return starts from around £150, a small limited company’s annual accounts and Corporation Tax return typically run from £600 to £1,800, and an all-in monthly package covering accounts, VAT, and payroll for a small company commonly falls between £100 and £300 a month.

What does an accountant charge in the UK for a self-assessment tax return?

Straightforward returns typically fall between £150 and £250. Once self-employment, property, or investment income is added, the same return commonly runs to £400–£800, reflecting the extra schedules and reconciliation involved.

How much does a limited company accountant cost per year?

A small trading company can expect combined accounts and Corporation Tax fees of roughly £900–£1,800 a year, rising past £3,500 for larger or more complex companies. Many firms now bundle this with VAT, payroll, and bookkeeping into a single monthly fee instead of billing each separately.

Why do accountant fees vary so much between firms?

Complexity, pricing model, firm positioning, and location account for most of the spread. Two firms quoting very differently for what looks like the same job are often, in effect, pricing different things.

Is outsourcing cheaper than hiring an accountant in-house?

It depends on scope, but most benchmarking shows outsourced delivery models bringing the all-in cost per unit of capacity down meaningfully against a fully loaded UK hire, once National Insurance, pension, and recruitment costs are included in the comparison rather than salary alone.

Will Making Tax Digital increase accountant fees?

Very likely for affected clients. Quarterly submissions from April 2026 for income over £50,000 mean substantially more touchpoints per client than the current annual return, and fee structures are already adjusting accordingly.

The Bottom Line

There isn’t a single number that answers how much does an accountant cost in the UK, and there probably shouldn’t be the range reflects real differences in complexity, delivery model, and positioning rather than inconsistent pricing. What’s changing is the cost structure underneath that range: rising employment costs, a heavier compliance workload from Making Tax Digital, and a steady shift away from hourly billing are all pushing firms to reconsider not just what they charge, but how the work behind that fee actually gets delivered. Firms that treat pricing and delivery as one connected decision, rather than two separate ones, are the ones best placed to protect their margins through 2026 and beyond.

Sources & Further Reading

Figures in this guide are indicative, based on typical UK market positioning, and should be checked against current rates. For the latest official guidance, we’d point you to HM Revenue & Customs (gov.uk) for Making Tax Digital and Employer National Insurance guidance, the Institute of Chartered Accountants in England and Wales (icaew.com) and the Association of Chartered Certified Accountants (accaglobal.com) for profession-wide benchmarking and standards, and the Federation of Small Businesses (fsb.org.uk) for small business cost and confidence data.