June 19, 2026
At some point, all UK small businesses will reach the stage where the books simply become too much for one person to bear alone. Invoices mount up, and the simple spreadsheet system is unable to do its job anymore. Typically, your next thought will be to hire an accountant.
In today’s time, it is a wise decision. In recent years, outsourced accounting has emerged as a viable alternative, frequently cheaper and far more readily expandable than having staff employed internally. This guide looks at both options to help you make the right choice for your business, with guidance on the stages where support is required, what the accountant's job involves, what it might cost, and how it compares to outsourcing.
If you’re thinking about hiring an accountant for a small business, then the correct answer will be based on your budget and stage, as well as the direction your business is taking.
Quick Answer
For most UK small businesses, outsourcing your accounting tends to be more cost-effective than employing a full-time accountant. You get a whole team of professionals, modern accounting software, tax expertise, and compliance support, all for a fraction of what one in-house hire would cost.
There is no sudden sign when you realise you need to start looking for an accountant. Generally, numerous signs build up and become very difficult to ignore. And here are probably some of the more frequent ones:
Once bookkeeping is consuming most of your time, the hiring pressure grows. For every hour that you spend working through receipts and bank statements, it's a lost hour for acquiring new clients and enhancing your business. When administrative duties become more substantial than the real tasks, hiring new people becomes an obvious option.
Between VAT, payroll, corporation tax, and Making Tax Digital, obligations are increasing, and even small mistakes can lead to penalties. This is the time when business owners think about when to hire an accountant.
Growth is a good sign, but it can complicate the figures. More staff, more suppliers and a huge number of transactions are much harder to manage with the basic system you have. Professional help ensures nothing gets too messy.
Many owners operate without knowing their current financial picture. If you do not immediately understand your cash position and your margins, it can lead to poor decisions. Effective accounting will restore this knowledge as well as your ability to operate confidently.
An accountant is a big term, and it is much more than what people expect. For a new business, it comprises different jobs.
At its core, bookkeeping helps with reconciling and tracking all of the business income and expenses on an everyday basis. Your VAT returns will be calculated correctly and filed on time to keep you safe from penalties. Payroll means that you and your staff know that payments are processed correctly each time and in accordance with the required rules, with HMRC submissions and pensions handled well.
These account figures are then brought together by an accountant into management reporting format that enables you to use this data for business decisions. Meanwhile, tax planning is a proactive approach to identify ways to minimize what you have to pay in taxes. The year-end accounts are then prepared ready for submission, as per the relevant accounting standard.
All of it is supported by HMRC compliance, ensuring all the filings are made correctly and promptly. Furthermore, an expert accountant will go beyond to provide business advisory services that help you strategise, budget, and expand.
So, if you choose to hire an accountant for your business, these are all of the areas of assistance you can expect.
Hiring someone in-house has clear benefits, but it comes with real disadvantages also. Knowing how to hire an accountant is a part of the process, but it is advisable to view both sides before committing anything.
The benefits of hiring an accountant are easy to recognise:
Dedicated support: Unlike a consultant who will work with different clients at a time, you will have dedicated staff whose job is to manage only your business and make sure you are getting the support you need and expect.
Always reachable: Whether you’re at your desk or not, you will be able to reach them immediately for support and get instant answers. You need not wait in a queue, but rather get the direct answers that will keep your business running.
Business insights: Because they work within your company each day, they get a unique perspective on your actual operations. They know what your numbers signify.
Learn More: Benefits of Outsourcing Accounting and Bookkeeping Services
There are real challenges to overcome as well:
High salary: An experienced professional accountant demands a high salary, which can be a high fixed cost for a small business to maintain monthly.
Recruitment costs: The cost of identifying the best accountant often includes agency fees, job posting costs and the amount of time the interview process takes up, long before they are actually hired.
Employee benefits: Aside from the cost of their salary, the hirers need to bear the costs associated with employer National Insurance contributions, pension contributions and a range of other benefits.
Training costs: Because they want to keep on the pace with new legislation and updates, this incurs additional training costs over time.
Limited expertise: An accountant might not be aware of the complex or specific tax and payroll issues, which may remain unresolved.
Staff turnover risk: If your accountant leaves, you lose their expertise and need to initiate a complete hiring process all over again.
For many owners, this is why the decision to hire an accountant for small business needs is rarely as simple as it first looks.
When small businesses consider the price to hire an accountant, they typically focus on salary. However, the true cost is significantly more when you consider everything else. The values below are estimates - they vary based on geographic area, level of experience and working hours:
| Cost Component | Estimated Annual Cost |
|---|---|
| Salary | £30,000 to £45,000 |
| Employer National Insurance | £4,000 to £5,500 |
| Pension contributions | £900 to £1,400 |
| Recruitment costs | £3,000 to £5,000 |
| Software and training | £1,000 to £2,000 |
| Total estimated cost | £39,000 to £59,000 |
This is a key comparison that many business owners want. If you compare the two models against each other, the difference becomes clear. To give a summary, the table below shows how accounting outsourcing vs hiring an accountant will look:
| Factor | Hiring an Accountant | Outsourced Accounting |
|---|---|---|
| Cost | Higher | Lower |
| Recruitment required | Yes | No |
| Team expertise | One person | Multiple specialists |
| Payroll knowledge | Limited | Dedicated experts |
| Tax expertise | Limited | Dedicated tax specialists |
| Scalability | Difficult | Easy |
| Software access | Additional cost | Usually included |
| Business continuity | Staff dependency | Ongoing support |
Learn More: In House Accounting vs Outsourcing: Which is Best for Your Business?
There's a reason that more and more companies are choosing to outsource accounting and bookkeeping services work: because it fixes several big problems.
Employing a full-time accountant is expensive once you add up salary, National Insurance, pension, and software. Outsourcing replaces all of that with one fixed monthly fee. You pay a set amount each month and know exactly what it covers, with no extra employment costs on top.
When you hire one accountant, you are limited to what that person knows. Outsourcing gives you a whole team instead. If you have a tricky VAT question one day and a payroll issue the next, there is always someone who handles that area every day. You get a wider range of skills than any one employee could offer
Tax rules and deadlines change often, and missing them can be costly. A dedicated provider keeps track of all of it for you. They know when each return is due and what the current rules say, so your filings are accurate and submitted on time. This greatly reduces the risk of mistakes and HMRC penalties.
Your accounting needs are not fixed. They grow as you hire more staff, customers, and transactions. Outsourced support adjusts as per your needs. You can get more support when you are busy and scale back when you are not.
Good accounting software is not cheap, and it needs setting up and keeping up to date. Outsourced providers already use modern cloud platforms as part of their service. You get the benefit of these tools straight away, with real-time access to your numbers from anywhere.
Managing an in-house finance team takes time and attention. When you outsource, every task becomes someone else's job. You no longer have to manage staff or chase paperwork, which frees up your time. That time can be invested in managing the business.
To compare it realistically, let’s have an example of a standard-sized small business. For example, a VAT-registered business that has 5-25 employees needs its bookkeeping kept up to date each month, as well as monthly payroll and the full year-end accounts produced at the end of the year. These circumstances provide reasonable parameters for comparing the two alternatives.
Working with a full-time team to get all that done requires salary, along with NI and pension contributions made by the employer and accounting software. Putting this together, it generally costs £45,000 to £55,000 a year, which is a big investment and fixed cost for any company.
Outsourcing similar work tends to run on a monthly fee rather than a wage. With a team of that size, it would be anywhere from £ 6,000 to £ 15,000 per annum, depending on the amount of work required. The costs would be predictable and easy to budget, with the software and the broader team already accounted for.
A business like this can reduce its costs by thousands each year by outsourcing and still gain access to all of the tasks that an in-house team would have handled. You gain savings by removing salary, employment costs and software charges, and instead make a one-time payment.
Business Process Outsourcing can really work well for the right kind of company. That’s definitely true for businesses that are expanding rapidly, or transforming as an organisation.
Few startups have the workload for a dedicated, full-time accountant when they start, but they can still require professional help. Outsourcing an accountant works really well in this phase. Businesses benefit from expert financial assistance at a fraction of the cost of hiring an accountant outright.
Businesses usually do need more than simple bookkeeping, but they also cannot afford to hire a full-time finance team. Outsourcing is the answer here. For a fraction of the cost of a full-time role, a business gets a fully outsourced finance department which includes bookkeepers, payroll services, taxation and reports.
Online businesses can have many transactions running through several channels of sale and payment systems. To be precise, with all of those comes dedication, accuracy and time. Outsourced teams can handle high transaction volumes, match payments correctly, and keep records clean.
Agencies, consultancies and law firms need to coordinate and manage billing, payroll and compliance - all at once. It’s often complicated to manage them on their own and to ensure consistency across operations. By outsourcing all of them to one trusted provider, it becomes accurate.
Running finances from multiple sites/branches adds complexity. Every branch will generate their own numbers, and bringing them together may be a headache. But bringing them together into one system allows you to see the overall business clearly, as well as each site individually.
Learn More: How to Select an Accounting Outsourcing Firm for Your Business?
PCS Global was set up to solve exactly these challenges, providing small business accounting services and a fully outsourced finance function for UK SMEs without the cost, complexity, and effort of building an in-house finance team.
You get support from accountants committed to learning your business. The accounts are kept accurate on a daily basis by in-house bookkeeping, and your staff are paid correctly and promptly using payroll services. End-to-end VAT compliance ensures you're fully covered, and management accounts help translate data into good business decisions.
PCS Global ensures that your taxes are prepared and filed in a timely, accurate manner. Built on a cutting-edge cloud accounting system that provides anytime, anywhere secure client access, PCS Global’s uk tax preparation service is tailored with tiered pricing to grow with your evolving needs.
In summary, PCS global providing all accounting services for SMEs in one roof:
When compared directly with hiring an in-house team, the logic is simple to see why outsourcing with PCS Global is the right decision.
| PCS Global Outsourcing | Hiring an Accountant |
|---|---|
| Team of specialists | Single employee |
| Lower cost | Higher employment cost |
| No recruitment required | Recruitment process |
| Scalable services | Additional hiring needed |
| Business continuity | Risk of employee leaving |
| Latest technology | Additional investment |
For years it’s been the default choice for a UK small business to hire an accountant. And for some businesses this is still perfectly true. However, it is not the only choice, and in many circumstances it’s not even the correct one anymore.
The price and inherent risks associated with having someone employed under your own roof are high. The alternative, a provider outsourcing the work, is much less risky and much cheaper.
The ‘right’ option depends on your size, budget and what you actually want to do. If you want one key team member fully dedicated with an understanding of your business, hiring makes sense.
If you value extensive skills, consistent cost and the ability to focus on scaling your business, outsourcing is a more logical choice. Regardless of what you decide, the trick is to be deliberate about what it’s actually going to cost and deliver.
