The Average Cost of an Accountant for a Small Business

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Small business owners often have a lot on their plate, from managing employees to ensuring customer satisfaction. One aspect that can be particularly overwhelming is financial management. Keeping track of expenses, invoicing, and tax filings can be time-consuming and complicated. That’s where an accountant can be an immense help. But what is the average cost of an accountant for a small business? Let’s explore the options and find out.

What is an Accountant?

An accountant is a certified professional who performs audits or financial statement analyses according to prescribed methods. They are adept at managing financial accounts, interpreting complex financial information, and ensuring businesses comply with tax laws.

Accountants can specialize in several areas, including management accounting, tax accounting, auditing, or forensic accounting. For small businesses, accountants can assist with bookkeeping, financial reporting, tax preparation, and guidance on revenue and cost trends, ensuring the financial health and sustainability of the business.

Related Reading: What is the Difference Between an Accountant and Bookkeeper?

What is the Benefit of Hiring an Accountant?

Hiring an accountant can be highly beneficial for small business owners. Accountants possess extensive knowledge and expertise in navigating the complex financial regulations businesses must adhere to. They can provide invaluable advice and guidance on remaining compliant with these regulations, ensuring your business operates within the legal framework.

Moreover, accountants bring a wealth of experience in various financial areas, such as budgeting, forecasting, and cash flow management. These skills are paramount for the success of any business, as they enable you to allocate resources effectively, plan for the future, and ensure healthy financial stability.

And, accountants can offer valuable insights into the optimal business structure for tax purposes. They can help you identify the most tax-efficient structure for your business, minimizing your tax liabilities while staying fully compliant with the tax laws. Additionally, they can assist in accurately filing taxes, saving you from the stress and burden of navigating the intricate tax filing process.

By having an accountant on board, you can also save significant time and effort. They can handle many of the financial tasks involved in running a business, allowing you to focus on core operations and strategic decision-making. This streamlines your business processes and ensures that your financial records are accurate and up-to-date.

What is the Average Cost of an Accountant?

The cost of hiring an accountant will depend on the size and complexity of your business operations and the services you require. It’s important to know what services you need before approaching an accountant so that you can receive accurate quotes and find a suitable provider for your needs.

For basic bookkeeping help, such as invoicing customers and managing accounts payable and receivable, the cost can range from $30-$100 per hour. This is usually a flat rate. The cost could be closer to $150-$300 per hour for more complex tax preparation work or auditing services. Of course, the cost of an accountant will vary depending on various factors, including their experience level, location, and the services you require. According to a recent survey by the National Society of Accountants, the average hourly fee for a small business accountant is $150 per hour. However, some accountants may charge more or less than this, depending on their experience and location. It’s important to get quotes from a few different accountants in your area to ensure you’re getting a fair price.

Depending on your needs, you may also consider a full-time accountant. A full-time accountant will cost an average salary of $40,000-$75,000 per year, depending on experience and the complexity of the work required.

Determining the Need for an Accountant

As a business owner, identifying the right time to hire an accountant can significantly impact your company's financial health and growth. Here are some scenarios when you might need the services of an accountant:

1. During the Start-Up Phase: When you're just starting your business, you have to deal with numerous legal and financial complexities. An accountant can provide valuable guidance on business structure, financial analysis, and tax obligations, helping you make informed decisions from the get-go.
2. Business Growth: If your business is rapidly growing, it might be challenging to keep up with the increased financial demands. An accountant can manage this growth, ensuring your finances remain organized and compliant.
3. Tax Time: If you're having difficulty understanding your tax obligations or if the process of filing taxes is too time-consuming, an accountant can take over. They are well-versed in tax laws and can ensure accurate and timely filing, saving you potential penalties.
4. Financial Complexity: If financial tasks are becoming complicated or too time-consuming, it may be time to hire an accountant. Complexities could include managing payroll for employees, dealing with government red tape, and interpreting financial data.
5. Decision Making: If you need help analyzing your company's financial data to help with strategic decision-making, an accountant's expertise can be invaluable. They can provide insights into cash flow patterns, business trends, and financial forecasting, guiding you in making sound business decisions.

Remember, hiring an accountant is an investment in your business. While a cost is involved, the potential financial savings and the peace of mind they provide can far outweigh the expense.

Related Reading: When to Hire an Accountant for Your Small Business

Alternative Options for Hiring an Accountant

Small businesses can benefit from outsourcing their accounting services to a third-party provider if they don’t have the budget or resources for a full-time staff member. This option is often more cost-effective because you’re only paying for the services that you require.

Consider Bench Accounting, for example. Bench is an online bookkeeping service that provides small business owners with a team of experienced bookkeepers who can manage their finances remotely. Bench’s pricing starts at $249 per month, which includes monthly financial statements and support from a dedicated team of bookkeepers. Their service is ideal for small businesses that don’t need the services of a full-time accountant but still want reliable financial management.

Get Started Organizing Your Financials Today

Ultimately, hiring an accountant is a great way to save time and money for small business owners who don’t have the bandwidth or expertise to manage their financials. They can help ensure that your financial records are accurate and up-to-date, provide expert advice, and save you time and effort. However, if the cost of an accountant is not the best investment for you right now, it may be time to consider a bookkeeping service like Bench Accounting. They promise to provide you with accurate financials and total peace of mind. What's stopping you? Sign up today with Fundid's exclusive offer and get 30% off your first 3 months with Bench Accounting!