As a business grows, the bookkeeping outgrows the founder. At that point there are two options: hire someone in-house, or outsource to a bookkeeping and accounting firm. Both can work. The right choice depends on your volume, complexity and budget.
The cost of in-house bookkeeping
In the UK, typical hourly costs for in-house finance staff range from around £12.71 to £20 per hour for an accounts executive, £30 to £45 for a senior accountant and £50 to £70 for an accounts manager. On top of salary come employer's National Insurance, pension contributions, holiday cover, recruitment, training and software licences. And one person rarely covers every skill a finance function needs, from bookkeeping to VAT to management reporting.
The cost of outsourced bookkeeping
Outsourced bookkeeping is usually priced as a fixed monthly fee based on transaction volume and complexity. You pay for the work your business actually generates, with no recruitment, holiday cover or training costs, and you get access to a team with a wider range of skills.
Advantages of outsourcing
Outsourcing gives you continuity, because the work doesn't stop when someone is off sick or leaves. You get qualified oversight, with work reviewed by experienced accountants. You get scalability, because the service grows with you without another hire. And specialist firms bring established processes, automation and software expertise that are hard to build in-house.
Advantages of in-house
An in-house bookkeeper is physically present, can handle non-finance admin alongside the books, and builds deep knowledge of your business. For very high-volume businesses with complex, daily finance operations, a dedicated in-house team can make sense, often supported by an external accountant.
A hybrid approach
Many businesses combine the two: an in-house administrator handles day-to-day paperwork, while an outsourced firm does the reconciliations, VAT, month-end close and management accounts. This keeps local knowledge in the business while adding professional review.
How to decide
Consider your monthly transaction volume, how complex your accounting is (multiple currencies, VAT schemes, stock, payroll), how quickly you need reports, and the true cost of an employee once overheads are included. For most small and growing businesses, outsourcing is the more cost-effective and resilient option until the finance workload justifies a full-time team.
Key takeaway
In-house bookkeepers bring presence and business knowledge, but carry salary, overheads and continuity risk. Outsourcing gives you a qualified team for a fixed monthly fee, and suits most small and growing businesses.
Frequently asked questions
Is it cheaper to outsource bookkeeping?
For most small and growing businesses, yes. Once employer's National Insurance, pension, holiday cover, recruitment and software are added to salary, a fixed monthly outsourced fee is usually lower than the full cost of an employee.
What does an outsourced bookkeeper do?
An outsourced bookkeeper records and categorises transactions, reconciles bank and card accounts, manages sales and purchase invoices, and prepares monthly reports, often alongside VAT returns, payroll and management accounts.
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