How Much Does an Accountant Cost for Tax Returns UK?

When it comes to filing taxes in the UK, one of the most common questions is: “How much will an accountant actually cost me?” Whether you're a sole trader navigating your first self-assessment, a freelancer with multiple income streams, or a limited company balancing payroll and VAT, understanding the cost of hiring an accountant is more than a budgeting exercise; it’s a step towards accuracy, compliance, and peace of mind.

The right accountant won’t just crunch numbers, instead they’ll save you time, reduce stress, and potentially uncover savings you didn’t even know you were missing. In this blog, we’ll break down the average costs, monthly fees, and key factors that affect how much you’ll pay an accountant for tax returns in the UK, so you can make an informed choice that suits your business and your budget.

What Is the Average Cost to Hire an Accountant for Tax Returns?

The average cost for a one-off personal or freelancer tax return in the UK is around £150 to £300. This typically includes basic tax preparation and submission to HMRC.

For more complex filings, such as for landlords, contractors, or company directors, the fee may rise to £300 to £600, depending on your income sources and deductions. The cost of tax preparation increases further if multiple income streams, real estate, or capital gains are involved.

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How Much Does an Accountant Charge to Do a Tax Return Monthly?

If you need more than an annual return, such as bookkeeping, payroll, and VAT returns, monthly packages offer better value. Typical monthly costs include:

• Sole traders: £60–£150/month
• Limited companies: £100–£450+/month

These prices depend on your business type, transaction volume, and the range of services provided. For instance, if you require VAT submissions and employee payroll, expect to pay towards the higher end.

What Factors Influence Accountant Fees for Tax Returns?

Several key factors influence how much you’ll pay an accountant for your tax return in the UK. Let’s break them down:

1. Type of Business Structure

Sole traders and freelancers typically have straightforward tax affairs, often requiring just a simple self-assessment. This makes them the most affordable to handle. In contrast, limited companies face stricter reporting requirements, including filing annual accounts with Companies House and submitting a corporation tax return. These added layers of compliance increase both time and cost.

2. Complexity and Transaction Volume

If your business has multiple income sources, high transaction volumes, or operates payroll, the level of complexity rises. More financial data means more time spent on reconciliation, accuracy checks, and reporting, leading to higher accounting fees.

3. Range of Services Required

Some businesses only need basic tax return support, while others require comprehensive services like VAT returns, bookkeeping, payroll, and year-round tax planning. Accountants may offer bundled packages or charge separately for each service. The more services you require, the higher the overall cost, but bundled plans often offer better long-term value.

4. Location of the Accountant

Geography still matters. Accountants based in larger cities like London generally charge higher fees due to increased overheads. Meanwhile, those in smaller towns or offering virtual services may provide the same quality of service at a lower price. However, it’s important to balance cost with expertise and accessibility.

What Services Are Typically Included in Monthly Fees?

Many accountants offer monthly packages tailored to the needs of small businesses, freelancers, and limited companies. These packages are designed to provide ongoing support, reduce financial stress, and ensure you stay compliant throughout the year.

Here’s what’s typically included in monthly accountancy fees:

1. Bookkeeping and Reconciliations

Accurate bookkeeping is the foundation of sound financial management. Accountants will record day-to-day transactions, reconcile bank accounts, and maintain ledgers, giving you a clear picture of your cash flow and business performance.

2. Quarterly VAT Returns

If your business is VAT-registered, your accountant will prepare and submit your VAT returns every quarter. This includes ensuring your records are MTD-compliant and helping you reclaim eligible input tax, reducing the risk of HMRC penalties.

3. Annual Accounts Preparation

Limited companies are legally required to submit annual accounts to Companies House. Monthly packages often cover the preparation of these reports, ensuring they meet all compliance and formatting standards well ahead of the deadline.

4. Self-Assessment Tax Return

For sole traders, directors, and freelancers, your self-assessment return will be handled as part of the package. This includes calculating your total income, allowable expenses, and ensuring your return is filed accurately and on time.

5. Payroll Services

If you employ staff, your accountant can manage your payroll, like calculating salaries, deductions, and issuing payslips. They’ll also handle HMRC submissions and ensure you're staying compliant with real-time reporting requirements.

6. Tax Advice and Planning

Good accountants don’t just file returns; they help you plan ahead. Monthly packages often include access to ongoing tax advice, helping you make strategic decisions, reduce liabilities, and improve long-term profitability.

What Should You Look for in a Good Accountant?

Finding the right accountant is an investment in your business’s long-term stability and success. Here’s what to look for when making your choice:

1. Do They Offer Tailored Support for Your Business?

A good accountant understands that no two businesses are the same. Whether you're a sole trader managing invoices or a limited company dealing with payroll and VAT, your accountant should offer personalised advice and services that align with your operations, goals, and industry challenges.

2. Are They Clear About Pricing and Deadlines?

Transparency is key. Look for an accountant who clearly outlines their fees, explains what services are included, and sets realistic deadlines. This helps you avoid unexpected charges and ensures you stay on top of important tax and filing obligations throughout the year.

3. Are They Professionally Qualified and Registered?

Always check that your accountant is registered with a reputable UK body such as ACCA, ICAEW, or CIMA. This not only confirms their qualifications but also ensures they adhere to strict ethical and professional standards, giving you confidence in the advice and services they provide.

4. Are They Up-to-Date with UK Tax Laws?

Tax laws in the UK can change frequently, from new reliefs and deductions to changes in VAT thresholds and reporting requirements. An experienced accountant will stay informed and ensure you remain compliant while helping you take advantage of any tax-saving opportunities.

5. Can They Support You Across Multiple Tax Years?

Your financial needs evolve over time, and your accountant should grow with you. Look for someone who can support you across multiple tax years, helping you plan ahead, track performance, and make smarter decisions as your business expands.

Is It Worth Paying for an Accountant or Should You Use Software?

Tax accounting software can be useful, especially for small businesses and sole traders comfortable managing their own finances. These tools help automate invoicing, expense tracking, and even generate basic reports to assist with tax returns.

However, while software streamlines day-to-day bookkeeping, it doesn’t replace professional advice. A qualified UK accountant can interpret complex tax rules, ensure full HMRC compliance, and identify tax-saving opportunities that software alone might miss. They also provide strategic insights tailored to your business goals, something no app can offer.

In short, if your tax affairs are straightforward and you have the time to manage them, software may be enough. But for growing businesses, limited companies, or anyone seeking peace of mind, working with a good accountant is often the smarter, more valuable investment.

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Conclusion

Understanding how much an accountant costs for tax returns in the UK or how much tax return accountant per month helps you make smarter financial decisions. Whether you’re a sole trader, freelancer, or managing a limited company, the right accountant offers far more than tax preparation; they provide peace of mind, strategic advice, and time-saving expertise.

While costs vary based on business type, complexity, and services required, the long-term benefits often outweigh the expense. Investing in a good accountant not only ensures compliance with HMRC but can also uncover savings you might otherwise miss, helping your business grow with confidence.

Frequently Asked Questions

Is it cheaper to file your own taxes?

Yes, it can be more affordable if you understand self-assessment and tax laws. However, filing incorrectly can result in penalties or missed deductions, costing you more in the long run than hiring a qualified professional.

Can I claim accountant fees on my tax return?

Yes, accountant fees related to business activities are usually tax-deductible. Sole traders and limited companies can claim them as allowable expenses, reducing overall taxable income and making the service more cost-effective over time.

How often do I need an accountant?

At the very least, you’ll need an accountant annually for your tax return. However, monthly or quarterly support is ideal for growing businesses or VAT-registered companies that need ongoing financial guidance and compliance support.

Do I need a tax preparer if I use accounting software?

Not always, but many businesses use both. While accounting software helps with basic record-keeping, a tax preparer ensures compliance, finds deductions, and offers personalised advice, reducing errors and improving overall financial management.

How much notice should I give an accountant before the tax deadline?

It’s best to contact your accountant at least 4–6 weeks before the filing deadline. This gives them enough time to review your records, request missing documents, and ensure your return is accurate and submitted on time.