Contractor accountant fees – what are the typical costs?

There are hundreds of specialist accountants working within the contracting industry – a fact that promotes healthy competition and keeps fees relatively low.

And most contractors have a very similar accounting profile – unlike other small businesses.

They’re typically one-man bands with a simple share structure – taking a tax-efficient salary and extracting profits as dividends.

For this reason, you can fairly accurately compare contractor accountants – as they almost all offer the same core services as standard.

In our experience, cost and customer service are the two most important things contractors look out for when choosing an accountant.

In this concise guide, we look at the typical fees and additional costs you’re likely to pay when you hire an accountant.

What are the typical monthly fees?

Here are some examples of how much the leading specialist firms charge:

Accountancy FirmFeeNotes
Aardvark Accounting£76Free company formation, FreeAgent software. Tax planning and IR35 advice.
Clever Accounts£99.50IR35 FLEX solution – any contract, now and in the future - £99.50 per month + 6 months' free business insurance.
SG Accounting£109Free company formation, face-to-face meeting, free tax return, IR35 contract review.
InTouch£120Free company formation, registered office address, unlimited IR35 reviews

What’s included in the monthly fee?

Most contractor accountants charge fixed monthly fees.

You can pay anything from £50 to £150 per month and more, depending on the firm, and the number of services they provide.

Firms sometimes offer different service packages, often known as ‘essential’, ‘standard’ and ‘ultimate’, or similar.

The more expensive packages often contain things like business insurance, and extra tax planning services. Or they give you priority above other clients when it comes to completing your annual accounts.

Core services

However, all monthly packages, whatever the cost, should include some specific core services.

These are the basics which ensure your company accounts are processed, and your statutory deadlines are met.

As part of their core offering, your accountant should:

  • Complete your company’s annual accounts.
  • Process the payroll for the company director.
  • Submit the company’s quarterly VAT returns.
  • Provide inclusive accounting software. FreeAgent is a very popular choice.
  • Deal with correspondence from Companies House and HMRC.

For more details, read our guide to typical accountants’ duties.

Additional services

On top of these core services, many accountants will:

  • Form your limited company.
  • Register your company for Corporation Tax, VAT and any other taxes.
  • Set up a business bank account for your company.
  • Provide a registered address for your company, and a service address for company officers.
  • Complete your personal tax return (Self Assessment).
  • Submit your company’s Confirmation Statement to Companies House (£13).
  • Provide IR35 contract reviews.
  • Complete accounts handed over by your previous accountant.
  • Add additional employees to the payroll.
  • Complete extra personal tax returns (for a co-director, for example).
  • Provide references for mortgage or lettings companies.

Some monthly packages include all of these ‘extras’ and meet all your company accounting needs for under £100.

Others will let you add some ‘extras’ to your monthly fee, or charge a one-off fee for specific tasks.

So, you need to find out exactly what each monthly fee includes if you want to accurately compare accountants’ fees.

What other factors are important apart from cost?

  • Is the accountant a contractor specialist? A specialist firm will have industry-specific knowledge.
  • What qualifications does the accountancy firm have?
  • What service guarantees will I receive?
  • Does the accountant provide access to online accounting software – either bespoke or third party (like the excellent FreeAgent)?
  • Will you have a dedicated account manager?

These are important questions to ask any prospective accountant.

Further Information

Partner Contractor Accountants

Last updated: 21st March 2024