How much does an accountant cost for a limited company?

Running a limited company brings a range of financial responsibilities, from filing accounts to managing tax compliance. While some business owners try to handle their own bookkeeping, most choose to work with an accountant to save time, reduce errors, and ensure compliance with HMRC and Companies House. The cost of hiring an accountant for a limited company varies depending on the size of the business, the services needed, and whether you choose a local firm or an online provider. This article explains how much an accountant typically costs for a limited company and what you can expect for your money.

The cost of an accountant for a limited company in the UK usually ranges between £60 and £250 per month, depending on the complexity of your business and the level of service you require. Some firms charge annual fees starting from around £750 to £3,000, while larger companies with payroll, VAT, and multiple directors may pay more.

What you are really paying for is expertise, time, and peace of mind. A good accountant ensures your company meets every tax deadline, pays the right amount of tax, and runs more efficiently.

Factors that affect accounting costs

The price of accounting support can vary widely between businesses because every company’s financial situation is different.

1. Size and structure of your business

A small one-person limited company with minimal transactions will have simpler accounting needs than a company with multiple employees and VAT obligations. The more transactions, bank accounts, and sources of income you have, the higher the workload for your accountant.

2. Type of services you need

Basic accounting packages usually include preparing annual accounts and submitting the Corporation Tax return (CT600). However, many companies also need:

  • VAT returns and digital bookkeeping under Making Tax Digital.

  • Payroll processing and pension submissions.

  • Quarterly management accounts.

  • Dividend planning and tax advice for directors.

  • Cash flow forecasting and budgeting.

The more services you include, the higher your monthly or annual fee.

3. Frequency of support

Some business owners prefer year round support, while others only need help at year end. Monthly accounting packages provide regular updates, bookkeeping, and financial advice throughout the year, while annual services focus solely on preparing statutory accounts and returns.

If you handle your own bookkeeping and only need an accountant for year end filings, costs will be much lower than if your accountant manages everything from start to finish.

4. Location and type of accountant

Local accountancy firms sometimes charge slightly more than online accountants due to higher overheads and face-to-face service. Online accountants can be cheaper, with prices starting around £60 to £100 per month, but communication is typically handled via phone or email rather than in person.

Ultimately, the best choice depends on whether you prefer personal contact or value a lower cost and faster turnaround online.

5. Industry and complexity

Companies in highly regulated sectors such as construction, finance, or law often have more complex reporting requirements. Accountants working in these areas may charge higher fees because of the additional expertise and compliance work involved.

Typical accountant costs by service

While exact prices vary, these are common price ranges for limited company accounting in the UK:

  • Annual accounts and Corporation Tax return: £750 to £1,500 per year.

  • Monthly accounting package (including bookkeeping and VAT): £100 to £250 per month.

  • Payroll services: £20 to £50 per employee per month.

  • VAT returns: £150 to £300 per quarter.

  • Registered office and Companies House filing services: £50 to £150 per year.

  • Management accounts or financial forecasting: £500 to £1,000 per year, depending on scope.

Some accountants offer fixed price packages, while others charge hourly rates ranging from £50 to £150 depending on seniority and expertise.

What is included in a typical accounting package

Most accounting packages for limited companies include:

  • Preparation and submission of annual accounts to Companies House.

  • Corporation Tax return and tax calculation.

  • Bookkeeping and bank reconciliation.

  • VAT returns (if registered).

  • Payroll and pension submissions.

  • Director’s Self Assessment tax return.

  • Ongoing advice and support for business decisions.

Comprehensive packages often include software such as Xero, QuickBooks, or FreeAgent, allowing directors to track real-time financial data while the accountant manages compliance.

Why investing in an accountant is worthwhile

Although accounting fees are a business cost, they often save far more money than they cost. Accountants ensure that:

  • Your company remains compliant with HMRC and Companies House deadlines.

  • You claim all allowable expenses and reliefs to reduce Corporation Tax.

  • Dividends and salaries are structured tax efficiently.

  • VAT and payroll submissions meet Making Tax Digital requirements.

  • Cash flow is monitored to prevent shortfalls or penalties.

In short, an accountant gives you clarity, saves time, and protects you from costly mistakes.

How to keep accounting costs down

You can reduce your accounting fees by:

  • Doing your own bookkeeping using digital software.

  • Keeping receipts and invoices organised.

  • Reconciling bank accounts regularly.

  • Providing your accountant with accurate records on time.

  • Choosing an accounting package that matches your business size.

By maintaining clean and accurate records, you make your accountant’s job easier, which often results in lower fees.

Example in practice

A small marketing agency with one director and turnover of £100,000 hires an accountant for £120 per month. The service includes bookkeeping, VAT returns, payroll for one employee, annual accounts, and tax planning advice.

The accountant identifies £3,000 in allowable expenses that the director had missed, reducing their Corporation Tax bill by £570. Even after accounting fees, the company saves money and gains peace of mind that all filings are compliant.

Choosing the right accountant for your company

When selecting an accountant, consider:

  • Whether they are qualified (for example, ACA, ACCA, or CIMA).

  • Their experience with limited companies in your industry.

  • What software they use and whether it suits your needs.

  • How communication and support are handled.

  • Whether fees are fixed or charged hourly.

A good accountant should offer clear explanations, transparent pricing, and proactive advice to help your company grow.

Conclusion

The cost of an accountant for a limited company varies, but most small businesses pay between £60 and £250 per month, depending on the level of service. While this is an extra expense, professional accounting support saves time, reduces tax bills, and ensures full compliance with HMRC.

By choosing the right accountant and keeping your records organised, you can build a valuable partnership that supports your company’s financial health and long-term success.