Are accounting expenses draining your profits quietly? A recent report by SCORE discovered that over 40% of small businesses rank accounting and bookkeeping as the most stressful areas of operating a business. If you are running a startup or expanding your company, you most likely want to know how much it costs to hire an accountant for a small business. In this blog, we will help you find the answer.
In reality, there's no uniform answer. From the intricacy of your operations to whether you are dealing with a CPA or a remote freelancer, a no. of variables influence what you pay. Let us clearly understand what drives these costs, what services you require, and how you can select wisely without sacrificing quality, all in this complete guide.
Why Hire an Accountant for a Small Business In the First Place?
Before you jump into costs, know what an accountant brings to your company. You are not only paying an accountant to do math if you employ them for small business assistance.
You are getting help with:
- Bookkeeping & monthly reconciliations.
- Financial reporting/projections.
- Tax planning and filing.
- Budgeting & cash flow analysis.
- Conformity with federal & state regulations.
- Support for payroll & invoicing.
- Business audits/financial reviews.
Good accounting is not just for tracking expenses; it is about keeping your business legally compliant, financially sound and prepared for expansion.
What Services Do You Actually Need?
Not all businesses require complete accounting assistance. A freelancer doing tax and bookkeeping filing once per year might only need basic bookkeeping and tax filing for handmade items. A growing eCommerce startup with inventory and employees may want monthly reports, sales tax filing in several states and strategic economic advice.
The following are typical service levels:
- Basic bookkeeping: USD 300 - USD 600
- Bookkeeping plus payroll: USD 600 - USD 1,200
- Full service accounting + advisory: USD 1,500 - USD 5,000
- CPA support (hourly): USD 100 - USD 400/hr
The more complicated your needs, the more you pay.
What Affects the Price of Hiring an Accountant for Small Business?
Now we need to see what variables actually affect the cost of hiring an accountant for small businesses:
A) Business Complexity: A sole proprietor with a single income stream pays much less than a retail company with multiple locations, vendors & tax demands.
If your business involves :
- Inventory management.
- Sales in several states.
- Workers or contractors.
- Loans or investor funding.
- International transactions.
Then you need an experienced accountant or CPA, which adds cost.
B) Volume of Transactions: More invoices, payments or payroll entries means more time for reconciliation. Accountants might charge by the hour or charge a higher fixed charge in case your monthly transactions get beyond a certain limit.
C) Tax Preparation Needs: Some accountants offer tax prep in their monthly service; others bill individually. For business owners, business tax returns (Forms 1120 or 1120S) cost more than Schedule C. With complex deductions, multiple filings or IRS representation, you'll pay more.
D) Your Location: Accountants in costly towns like New York, San Francisco or Los Angeles usually charge more than experts in smaller towns. This holds particularly true for firms that hold in person meetings. Remote or outsourced accounting (like with virtual teams) can usually save 30-50% on fees without sacrificing quality.
E) Accountant Experience & Credentials: A licensed CPA or experienced accountant with a good portfolio will probably charge more than a beginner. But this investment can pay off in reduced taxes, compliance and financial guidance.
Should You Work In-House or Outsource?
This is among the most essential cost decisions you can make for your company. Let us compare these options:
In-House Accountant
- Salary: USD 50,000 to USD 80,000 a year (for full time).
- Extra costs: benefits, payroll tax, insurance, equipment.
- Best for: larger small businesses with complicated daily needs.
Outsourced Accountant
- Monthly packages: USD 500 to USD 2,500 for each scope.
- Absolutely no overhead for staff.
- Scalable to your growth.
- Best for: startups / lean teams / seasonal companies.
The Fino Partners provides outsourced accounting packages for startups and growing companies that make professional accounting more accessible and affordable.
Common Accounting Costs Breakdown
Here are the common accounting costs in simpler terms:
A) Monthly Accounting Services - Bookkeeping, Reconciliation and Financial Reports
Majority of small businesses call for USD 500-USD 1,200 per month.
B) Year End Tax Filing
USD 300-USD 2,000 depending on entity and complexity.
C) Strategic Financial Consulting - Budgeting, Cash Flow Forecasting, Financial Modelling
USD 100-USD 300/hour.
D) Payroll Processing
Often included in accounting or USD 50-USD 150/month individually.
E) Accounting Software Costs - QuickBooks, Xero or FreshBooks subscriptions
USD 30-USD 70 / month (not including accountant's fees).
Knowing these ranges can enable you to avoid sticker shock and plan your budget.
Tips to Lower Accounting Costs Without Sacrificing Quality
If you are hiring an accountant for startup operations on a limited budget, the following are some essential tips to keep in mind:
- Bundle services: Choose firms that do bookkeeping + tax + payroll together.
- Use cloud software: Organise receipts and automate categorization to minimize manual labor.
- Remain organized: Clean financial records save your accountant time to sort things out.
- Go remote: Hiring a virtual accountant or utilizing services like The Fino Partners can lower overhead.
- Avoid the cheapest: Cheap services typically lack support or expertise. It costs more to fix errors later than it can correctly the very first time around.
Helpful Links
- 10 Signs Your U.S. Business Needs to Hire an Accountant
- How Much to Hire an Accountant? 2025 Cost Guide
- Hire an Accountant in New York for Small Business Success
It isn't always about selecting the cheapest accountant for small business. It is about balancing affordability, experience and support. Whether you are operating a small business or starting a high growth startup, the right accountant could be your true financial partner.
Remember that what you spend on accounting could influence how your business functions as time passes. Rather than viewing it as a cost, consider it an investment for precision, compliance and better decision-making.
If you want to hire an accountant for startup growth or simply upgrade from your current setup, The Fino Partners offer the flexibility, quality & affordability that modern small businesses like yours need.
