Bookkeeping is a vital task for businesses of any size – including if you’re self-employed. It involves organising and recording financial transactions which is crucial to submitting accurate self assessment tax returns and ensuring that everything is in order should you get audited by HMRC.

So, how much will bookkeeping cost? Let’s explore everything in this guide.

How much does bookkeeping cost?

How much bookkeeping costs depends on a variety of factors, including the complexity of the tasks you need completing, the experience of the bookkeeper and how they choose to charge. If you’re looking for a fixed set of monthly services, the average cost for basic small business bookkeeping is £225 per month.

Bookkeeping costs vary widely depending on what you need your bookkeeper to do. To help you understand how much you might pay, take a look at the table below to get an idea of average costs for different services:

Service	Average hourly rate	Average monthly fee
Basic small business bookkeeping	£16	£225
Payroll (for up to 20 employees)	£20	£300
Invoicing, bill payments, accounts receivable/payable	£20	£320
Financial analysis & reports	£31	£525
Quarterly and annual tax preparation	£27.50	£450

What does a bookkeeper do?

A bookkeeper is responsible for keeping track of a business’ finances. They will monitor all accounts, managing transactions and bills to ensure that payments are made on time and everything is in order for tax return time.

Common bookkeeping tasks include:

• Recording financial transactions and ensuring the books are balanced

• Bank reconciliation

• Accounts receivable/payable (ensuring customers pay on time and suppliers are paid on time)

• Payroll

• Monthly and end-of-year reporting

You might not want or need help with all of these bookkeeping tasks. Most accountants and bookkeepers will have a range of packages for you to choose from, and you may be able to ask for a bespoke package based on the tasks you need help with.

What is a full charge bookkeeper?

If you’ve been researching bookkeepers for a while, you’ve probably seen the term ‘full charge bookkeeper’. This type of bookkeeper looks after all accounts a business holds and has sole responsibility for accounts within the organisation.

Full charge bookkeepers are often more experienced as they have to have the knowledge to run the entire accounting side of the business. This means you’ll usually pay more for full charge bookkeeping services.

A full charge bookkeeper is ideal for you if you have a small business that doesn’t need a large accounting team or the expertise of a financial controller.

What will affect the cost of bookkeeping for my business?

There are a few factors that will affect the cost of bookkeeping for your business:

Business type

The type of business you run will have a big impact on the cost of bookkeeping. If you are a retail business with lots of stock, your bookkeeping needs are likely to be higher than a small software business that mainly needs invoicing support.

What services you need

As you’d expect, you’ll pay less for simple bookkeeping tasks like bank reconciliation and data entry and more if you require full charge bookkeeping including payroll, credit control and financial analysis.

How complex your finances are

The more complex bookkeeping that’s required, the more you’ll pay. If your business is small with one type of revenue stream and little outgoings, you’ll pay less than a business with many income streams, payments made to or received from abroad and complicated tax needs.

Your bookkeeper’s experience

If you choose a bookkeeper with many years of experience, expect to pay more. They will have more knowledge to deal with various situations that might arise in your business, and may be able to offer more insight and financial analysis that someone that’s less experienced.

Your location

The cost of living varies across the UK, so bookkeepers will charge different rates. If you live in London or the south east, expect to pay more for bookkeeping than if you live in the north of England or Scotland.

What is the difference between a bookkeeper and an accountant?

The main difference between a bookkeeper and an accountant is that bookkeepers tend to focus on the day-to-day financial tasks for your business, whereas accountants generally provide more financial advice and tax guidance.

Accountants will take the data that your bookkeeper works hard to keep up-to-date and organised, and analyse it to help you make strategic decisions about cash flow and business growth.

Chartered accountants can be bookkeepers, whereas bookkeepers cannot be accountants unless they have the correct qualifications.

Here’s a breakdown of the different tasks that bookkeepers and accountants typically do:

Bookkeepers	Accountants
Record all financial transactions and balance the books Deal with accounts receivable/payable Prepare monthly and yearly reports Manage payroll	Analyse a bookkeeper’s data Prepare and file tax returns Advise the business on compliance, tax and other financial situations Help apply for business loans and find funding opportunities

Why do I need a bookkeeper for my small business?

If you’re a small business owner and you’re doing your bookkeeping yourself, there are so many reasons why it makes sense to hand the responsibility over to a bookkeeper. It will save you valuable time that you can spend on growing your business rather than getting bogged down in receipts and bank transactions.

Here are just some of the reasons why you need a bookkeeper for your small business:

• Saves you time: You can focus on growing your business and doing work that pays

• Helps you track growth: Pinpoint where your business is spending money

• Helps you budget: See how your finances are at any time and look for opportunities for cutbacks or further spending

• Prepares you for tax: Your accountants will be able to do your end-of-year accounts and tax returns easily

• Prepares you for audit: If you are audited, your finances will be in top shape and ready for auditors to review

• Facilitates strategy: Well-organised books make it easy for you and your accountants to work on strategies and conduct deep analysis to help with growth

• Offers data for investors: Well-kept financial reports will help investors to see that your business is a worthy investment and that they can trust you

Is it worth paying a bookkeeper?

We think it’s well worth paying a bookkeeper. Hiring a bookkeeper gives you time back to spend on growing your business, and it also ensures that you’re on top of your accounts so that tax return time or an audit doesn’t come as a surprise.

While you may think that paying a bookkeeper is an unnecessary expense, consider how much time it takes you to get your books ready for your accountant every year – is it worth paying someone to keep on top of them all year round? Only you can decide.

If you’re ready to find a bookkeeper, use our partner Unbiased to find one in your area.

Estimates for common accountant jobs;

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