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How much does a bookkeeper cost on average? Find out how to set your budget and find a brilliant bookkeeping professional to make your business soar.
Efficient bookkeeping is the backbone of your business's financial wellbeing, ensuring that every penny is accounted for and tracking where your finances go. But if you're a small business owner, the cost of bookkeeping services can be a significant part of your operational expenses. In the UK in 2024, bookkeeping costs vary based on multiple factors from the size of your enterprise to your exact location. Here’s your comprehensive guide to understanding bookkeeping costs in the UK - and how to choose the right one so your business goes from strength to strength!
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In a nutshell, bookkeeping is the art (and science) of keeping financial records and updating these records over time, so you have a completely reliable record of where your money has gone, and when. Bookkeeping needs to be carried out regularly - under ideal conditions, it should be done every day as part of every business’ daily operations.
So, you may know you need a bookkeeper - but if you don't want to tackle it yourself, how much does it cost to hire bookkeeping services in the UK?
Understanding the average cost gives the baseline for your bookkeeping budget. The price tag on this essential service can vary widely. On average, businesses in the UK spend around £200 to £600 per month for bookkeeping services, with smaller businesses at the lower end of this spectrum and larger ones at the higher end. However, these averages are just a ballpark figure.
You can hire a bookkeeper by the hour if your needs are simple, or for longer term work, some businesses choose a monthly rate. We'll go into more detail in a moment.
| Rate type | Price |
| Average hourly rate | £20-£40 |
| Average monthly spend | £525 |
There can be a big difference in rates, and lots of factors play into that - for example, if you're paying an agency (more expensive, but probably with more resources) or a freelancer (usually a cheaper option).
If you’re considering hiring a freelance bookkeeper, you’ll find that they typically charge on an hourly basis. In the UK, you can expect to pay between £20 to £40 per hour for freelance bookkeeping services. This hourly rate is influenced by factors such as experience, demand, and location. For smaller projects or businesses that only need periodic help, this can be a cost-effective solution.
If your business requires extensive bookkeeping services that might not fit into a few hours each month, daily rates could provide a more predictable pricing model. Daily rates for bookkeepers in the UK vary, but you can expect to pay between £200 to £400 a day.
For larger enterprises with significant transaction volumes or those with a consistent need for detailed and timely bookkeeping, hiring a full-time bookkeeper may offer the best value. In 2024, the average salary for a full-time bookkeeper in the UK ranges from £20,000 to £35,000 per year, depending on experience and the sector of the business.
Several variables can significantly impact the cost of bookkeeping services. These include the size of your business, the complexity of your financial transactions, and the number of accounts that need to be managed. Larger businesses typically have more extensive operational data and require more time for data entry, reconciliation, and reporting. Additionally, the experience and geographic location of the bookkeeper also play a role. Basically, the more you need, the more you pay.
Here’s a rough breakdown of average monthly bookkeeping costs based on business size:
Small Businesses
Monthly costs typically range from £120 to £700, with the smallest micro-enterprises paying on the lower end and larger SMEs on the higher end.
Medium Businesses
Monthly costs can vary between £500 to £1,700 for more complex bookkeeping needs and additional financial reporting.
Large Businesses
With multiple streams of revenue, complex accounting systems, and a larger volume of transactions, costs could reach up to £10,000 per month. This is the point at which a business will usually have a full time bookkeeper!
Unsurprisingly, the cost of living and doing business in various regions across the UK will affect bookkeeping prices. Here are some regional ranges:
Bookkeeping fees here are typically 20-30% higher than the national average due to the higher cost of living.
South East
Prices are slightly lower than London but still higher than most regions.
Midlands and North
These areas usually boast bookkeeping fees below the national average, making them an attractive location for cost-conscious businesses. Large cities like Birmingham may be an exception.
There are some ways around the regional variations, though - for example, if you find a bookkeeper who is happy to work entirely remotely, you might be able to find better prices (although you'll miss out on face-to-face time, which can also be useful.)
Different types of bookkeeping services may come with specific pricing models. If you need specialized services such as VAT returns or preparing for tax season, expect this to affect the cost. Remember that many financial jobs won't fall into bookkeeping at all, such as payroll services.
While bookkeeping is an indispensable part of running a business, there are ways to make it more cost-efficient.
Investing in bookkeeping software like QuickBooks or Xero can significantly reduce the amount of manual data entry required by a professional. This not only saves time but also can decrease the errors often associated with manual data input.
Keeping your financial records organized and maintained regularly can ease the workload for your bookkeeper, especially if you're paying by the hour. Tools like receipt scanners and cloud-based storage can help keep everything in one place and easily accessible.
If you have a small business with a straightforward financial landscape, you may be able to handle bookkeeping on your own. Many startups and sole traders can manage their financial records with basic accounting knowledge and simple bookkeeping tools.
Hiring a professional on a part-time basis may cut some extra costs for you. This way, you do not have to spend money when the services of the professional aren’t needed.
If you’re on a budget you might want to consider hiring a mid-range professional. Their services are usually a mix of expertise and affordability - win-win!
Hiring individual professionals is cheaper than hiring a bookkeeping/accounting agency to do the job for you.
It’s essential to strike a balance between the cost of services and the quality and value they bring. When your budget dictates your choice, consider these tips:
Define your needs
Establish what your business requires from a bookkeeper. This could be a monthly bank reconciliation, VAT returns, or other services.
Shop around
Don’t go with the first bookkeeper you find. Get quotes from a few professionals to compare pricing and services.
Review credentials and experience
Bookkeepers with relevant industry experience and certification may charge a premium, but the accuracy and expertise they bring can save you money in the long run.
Negotiate
Depending on the volume of work, bookkeepers may be open to negotiation on their rates or the services they provide within a package.
Understanding the dynamics of bookkeeping costs is crucial to financial planning for your business. By considering the various rates and pricing models available, as well as the strategies you can use to manage bookkeeping expenses, your business can maintain accurate financial records while staying within budget. Whether it's investing in automation tools, hiring a brilliant bookkeeper, or negotiating rates, the right approach can help you get to a healthy bottom line for your business!
The average rating for Bark Bookkeepers is 4.89, based on 107,050 reviews
5/5
based on 107,050 reviews
