Fixed fee accounting means one agreed price, no surprise invoices, and no clock running when you pick up the phone. But "fixed fee" doesn't mean the same thing at every firm. Here's what a fixed fee accountant should include, what it typically costs, and what to ask before you sign.
Paying an accountant by the hour makes it hard to budget, and it can put you off asking the questions that would actually save you money. That's why more small businesses now choose a fixed fee accountant: a set monthly price, agreed up front, for a clearly defined package of work. Whether you're looking for accountants in Bristol or a fixed fee accountant anywhere in the UK, this guide explains what you should expect to get for your money.
What does "fixed fee" actually mean?
A fixed fee accountant agrees a set price for a defined scope of work, usually paid monthly, instead of billing you for their time. Spreading the cost evenly across the year means no large invoice landing at year end and no charge every time you send an email.
The important words are "defined scope". The price is fixed for everything inside the package, and anything outside it is quoted separately. A good accountant will tell you exactly where that line sits before you sign, not after.
What a fixed fee package should include
For a sole trader, a typical package covers:
- Your Self Assessment tax return, prepared and filed with HMRC
- Year-end accounts, or a summary of your income and expenses
- Cloud bookkeeping software, such as Xero or QuickBooks
- Support by phone and email without being charged by the minute
For a limited company, you should expect more, because there is more to file:
- Statutory year-end accounts filed with Companies House
- Your Corporation Tax return prepared and filed with HMRC
- Your annual confirmation statement
- The director's personal Self Assessment tax return
- Payroll and PAYE for directors and a small team
- Bookkeeping and management reports, depending on the package
- VAT returns if you're VAT registered (check whether this is included or an add-on)
How much do fixed fee accountants cost?
There is no single price, because the work involved varies from one business to the next. Sole traders generally pay less than limited companies, because there is less statutory filing involved. The main factors that affect your fee are:
- Your business structure: sole trader, partnership, or limited company
- How many transactions and bank accounts you have each month
- Whether you do your own bookkeeping, or want it done for you
- Whether you're VAT registered
- How many people you have on the payroll
- The state of your records, since tidy, up-to-date books take less time to work with
As a guide, our own fixed fee plans start from £45 a month (exc VAT) for sole traders and from £150 a month (exc VAT) for limited companies. Growing businesses that need forecasting or outsourced finance director support get a bespoke quote.
What is often charged as extra
Fixed fees are designed to cover your regular, predictable compliance work. One-off or unpredictable work is usually quoted separately. Common examples include:
- Catch-up bookkeeping, or overdue returns from previous years
- Dealing with an HMRC enquiry or compliance check
- Forming a company, or changing its share structure
- One-off projects, such as raising finance or selling a business or property
- Payroll for more employees than your package covers
None of these are red flags. Just make sure you know how they're priced before you need them.
Fixed fee or hourly: which is better?
For most small businesses and limited companies with regular, predictable needs, fixed fee accounting is better value and far easier to budget for. It also changes how you work with your accountant. When the clock isn't running, you raise questions early, before a decision is made, and that's when good advice is worth the most. Hourly billing can still make sense for a genuine one-off piece of work.
Questions to ask before choosing a fixed fee accountant
- What exactly is included, and what is quoted separately?
- Is the accounting software included in the fee?
- Are phone calls and emails included, or charged as extra time?
- Will I have a named contact who knows my business?
- What happens to my fee as my business grows or my needs change?
- Are you professionally qualified? In the UK anyone can call themselves an accountant, so look for membership of a professional body such as CIMA, ACCA or ICAEW.
- Will you handle the switch from my current accountant?
A local accountant in Bristol, or online?
Cloud accounting software means a good fixed fee accountant can look after your business from anywhere in the UK. Even so, many business owners value an accountant who is local and understands the area they trade in. Based in Bristol, we work with small businesses and limited companies across north Bristol, South Gloucestershire and North Somerset, and with clients right across the UK using cloud software such as Xero and QuickBooks.
Switching to a fixed fee accountant
Switching accountants is simpler than most people expect, and you don't have to wait until your year end. Your new accountant contacts your previous one for professional clearance and arranges the handover of your records, so there's very little for you to do.
Fixed fee accounting from LN Accountants
We're a CIMA-qualified practice in Bristol with over 20 years of combined experience, offering fixed fee accounting for sole traders, small businesses and limited companies. Every plan has a clear monthly fee agreed up front, with your accounting software included and support that doesn't come with a running clock. Take a look at our pricing, or get in touch for a quote tailored to your business.
