A question that we have been frequently asked is “how much does a bookkeeper cost in the UK?” to assist, we’ve written the article below to show the range of fees that you can expect to pay in different circumstances and to help you decide the best solution for you.
Bookkeeping is normally quoted on an hourly basis. Rates in the UK are currently in the range of £12 to £80 per hour. This is quite a wide price range, so we have provided more details below.
An outsourced bookkeeper in the UK will typically charge between £30-£50/hour. For this, you should expect them to be fully insured, a member of a recognised professional body, and to offer you some continuity and backup from other staff, or partners, if they are absent. This rate may be higher if there are additional complexities or if you use an accountant for bookkeeping work.
You can expect to pay a lower hourly rate if you employ a bookkeeper inhouse, with typical salaries around £12-£20 / hour. However, there are additional costs to consider - pension contributions, employers National Insurance contributions, sickness, holidays etc. An inhouse person usually becomes the most economical once you have more than 20 hours of bookkeeping work per week, or if they can also assist with other tasks in the business.
The cheapest bookkeeping hourly rates currently being quoted are from overseas agencies. We are regularly contacted by agencies offering to provide us with bookkeeping services from India starting at £8/hour. For a more detailed comparison, please read our blog “Is a local bookkeeper superior to an overseas agency” here.
An hourly rate is not particularly informative, if you don’t know how the long the work will take. The time taken will vary significantly depending on the volume of transactions, the complexity of your business, and the level of communication between your business and your bookkeeper. Let’s look at each of these in turn to see how they influence how much you will pay for bookkeeping services.
The less there is to process, the quicker it will be, and the less you will pay. As volumes increase, you can expect to pay more. The relationship between cost and volume is not quite linear. At the bottom end of the scale, there is usually a minimum charge from most bookkeepers, and at the top end, once you reach high volumes, you can expect to achieve some efficiency savings by automating some tasks.
The more complex the business setup, the longer the bookkeeping work will take. We find the easiest way to describe business complexity is by examples. Take business A and business B described below. They are both the same size with the same turnover, the same number of transactions and the same number of employees.
Business A is less complex than Business B, the bookkeeping will be quicker, simpler, and therefore cheaper.
In our experience, one of the best ways you can keep your bookkeeping costs low is to establish good disciplines for frequent and regular information exchange between your bookkeeper and yourself and to stick to them.
We recommend that you and your bookkeeper together compile a list of all the things that you need to provide to them every month (e.g. bank statements, credit card statements, purchase invoices, expenses etc) and that you are meticulous at providing everything on the list in the agreed format, to the agreed timescale. By doing that your bookkeeper can read each document only once and process it first time, and work at maximum efficiency. The more information that they are missing, the more queries they will have for you and the longer the work will take.
We hope that the above article has given you some insights into potential bookkeeping rates and the influences on how long the work will take. For more precise cost estimates for your business, contact us here and we will be happy to provide you with a quote tailored to your business.
