Running a small business in the UK is no easy task. It involves a lot of hard work and balancing many different roles. As a small business, you’re never just ‘owner’. You’re the marketer, worker, customer support, accountant, and more, all rolled up into one. It’s a tough job.
There are many pros to doing everything yourself. It’s you making the decisions, and you don’t need to rely on (or pay!) anyone else. But no small business owner is superhuman – there comes a time when you need to know when to keep certain tasks under your wing or to get help from the professionals.
If you’re thinking now might be the time to hire a professional accountant, then this blog is the place for you. We’re here to round up the full list of pros and cons of using an accountant for small businesses in the UK and help you assess whether the help is a much-needed investment or if another path is right for you.
Top 7 pros of using an accountant for small businesses
First, let’s look into the pros of using an accountant for your business. Some of these pros will depend entirely on what your business is, how complex your accounts are, and the jobs that you need an accountant to do.
Accountants can offer more than basic bookkeeping and tax returns. If required, they can also assist with a variety of jobs, such as helping to grow your business, securing funding, and assisting with all matters of financial planning and decisions. If you want to know more, see our guide on how accountants can help your business succeed.
For now, let’s get into the top advantages of using an accountant for a small business.
1. Access to knowledge and expertise
It’s your job to know your business inside and out. It’s not your job to understand everything about the UK’s complex financial landscape, tax system, and changing regulations.
If reading that sentence alone is causing your mind to drift, then it might be best to get an accountant who brings years of expertise and knowledge to your business and your accounts.
70% of firms hadn’t changed their accountant in the past five years, which shows how irreplaceable they are for a successful business (Carey & Tanewski, 2016).
2. They keep your business compliant
No one wants late fines, penalty notices, or, heaven forbid, an HMRC investigation.
Accountants ensure your business is compliant and that your accounts are submitted accurately and on time.
3. They save you time
As the saying goes, time is money. Every hour that you don’t have to spend working out your finances or submitting your returns is precious time and resources that you can put into other areas of your business.
Just think: what would you do instead if you didn’t have to balance your books?
4. They can provide long-term cost savings
Accountants do cost money. But, in the long term, this cost can actually save your business money. The first is through time alone, which we mentioned just now.
But because of an accountant’s expertise, they will be able to find ways to save your business money on your taxes and returns by identifying eligible expenses, reliefs, and tax-saving opportunities that you wouldn’t have known about otherwise.
UK SMEs with an accountant on their payroll gained £28,000 average annual savings (Quickbooks, 2022).
Top-Rated Online Accountants:
| Accounting Software | Cheapest Package | Value For Money | Our Rating | Review | Official Site |
|---|---|---|---|---|---|
 | £24.50/mo | Excellent | 9.4 | Read Review | Visit Website |
 | £42/mo | Good | 9.3 | Read Review | Visit Website |
 | Variable | Good | 9.1 | Read Review | Visit Website |
5. They can provide strategic advice to grow your business
By having a complete view of your finances, accountants can offer a lot of strategic advice to help grow your business.
They can present cash flow projections for smarter planning (particularly during seasonal highs and lows) and identify potential pitfalls before they become a problem for your business.
Secure funding easily by having them prepare your financial information for investors, loan applications, and more.
Accountants also provide connections to other businesses that they work with that might be able to help your business grow.
As a result, SMEs working with accountants enjoyed 11.5% more profit compared to those who don’t (Quickbooks, 2024).
6. They can enhance your business credibility
Having a professional accountant manage your books gives your business a level of credibility, which could be all the difference if you’re currently trying to negotiate contracts or seek external financing.
7. They give you peace of mind
Did we save the best for last?
Having an accountant by your side gives you the peace of mind knowing that your accounts are in the best possible hands. It’s one less stress for you and your business, and will be sure to give you a better night’s sleep without worrying about upcoming returns.
The 4 cons of using an accountant for small businesses
Now that we’ve been through the good parts of having an accountant, let’s balance the picture by looking at the drawbacks.
1. It’s an extra cost
Perhaps the biggest drawback of hiring an accountant is the cost to your business.
The exact cost of an accountant will vary depending on your business, including what type of business you are, how much your annual turnover is, whether you’re VAT registered, if you have any PAYE employees, and more. For example, the average accountancy costs for a limited company are as follows:
| Service | Company turnover | Average accountancy costs |
| Business accounts | £20,000 to £30,000 | £150 |
| £100,000 to £130,000 | £400 | |
| £250,000 to £300,000 | £600 | |
| Payroll services (such as PAYE) | 50 employees | £200 per month |
| 100 employees | £500 per month | |
| Director’s tax return | £300 | |
| VAT returns | £0 to 100,000 | £100 |
| £100,000 to 200,000 | £150 | |
| £200,000 to 400,000 | £200 |
For sole traders, accountancy costs tend to be lower, running from around £100–£150 monthly for basic services like Self-Assessment and tax advice, or £150–£300 as a one-off payment just to submit your tax return.
Generally speaking, the more complex your accounts are and the more services you need, the higher the accountant’s fee. In addition, if you already use accountancy software, you might find that your account costs are reduced as they won’t have to manually go through your accounts.
2. You’re handing over control
Having an external accountant for your business means entrusting someone else with the reins. For some business owners, giving someone else control can be tough, as you have to trust someone with your most sensitive data.
3. Not every accountant is a match for your business
Not every accountant is the same. Without proper research, you might end up trusting and paying an accountant who just doesn’t work as well with you as you had anticipated. That means time and money lost – and might put you off using an accountant in the future.
So if you are considering hiring an accountant, it’s vital to find the right one for your business. We have put together the top questions to ask an accountant before engaging them, so you can work together with confidence.
4. You might pay a premium for services you don’t use
As we outlined earlier, accounts offer a number of different prices and services. Some charge by the hour, while others might offer packages that include a variety of services that, on the surface, look like they might provide the most value for your business.
However, not all accountancy packages are right for all businesses. If you are handling all the bookkeeping and record-keeping but still paying for a full-service package, you may be overpaying for services you aren’t actually using.
So it’s important that you know what services you need beforehand. This will allow you to choose the right package/accountant for you without overpaying.
Running the numbers: Does your business need an accountant?
Now that you have a clearer picture of the pros and cons of using an accountant for small businesses UK, it will be easier to assess if hiring one is right for your business. Ultimately, this decision is yours to make – and will depend entirely on your unique circumstances.
However, if you’re:
- Approaching the VAT threshold or are about to hire employees
- Struggling with multiple income streams
- Spending far too much time on your accounts
- Are uncertain about any part of your finances or returns
- Want advice on how to grow your businesss
Then you might just benefit from hiring an accountant.
Still unsure?
Find out how to weigh the accountancy costs versus the value and whether paying for accountancy software might be the best move for you in our full guide: Do I need an accountant for a small business in the UK.
If you’re ready to find your accountant, we’re here to help with the top questions to ask when hiring an accountant and our reviews of the best accountants in the UK.
EXCLUSIVE OFFERS – Save On Your Accountancy Costs
