Accounting Cost for Small Business?
As a small business owner, managing finances can be challenging, often leading to the cost of hiring an accountant. But what should small business accounting costs be? The answer isn't straightforward.
What is the role of accounting in a small business?
Small business accounting closely ties to your business bank account. Key tasks like double-entry bookkeeping, recording transactions, and reconciling accounts all ensure your ledger matches your bank records—making a business bank account a crucial first step.
If you offer services, your focus will be on service transactions. Retail businesses need to manage inventory, while production companies must also track fixed assets. Different industries require different accounting priorities.
How much do small business accounting typically cost?
Realistically, depending on how you approach your accounting, there are generally three options. Each option has its own advantages. We've tried to break down some of the costs to give you a clearer picture of what a small business might be billing.
DIY with accounting software
You’ll need to subscribe accounting software that you can manage on your own. For example, QuickBooks, a popular choice, starts at $30 per month. While this option is more affordable, it requires your time and carries a higher risk of errors. It’s best suited for small or early-stage businesses with simpler accounting needs.
Hiring an
accountant
A part-time accountant's salary starts from $500 per month, while a full-time accountant typically starts from $3,000 per month. These figures exclude employee benefits and taxes. Although this is the most expensive option, the advantage lies in having an internal team to handle all accounting matters directly. It’s more suitable for growing businesses that have reached a certain scale.
Outsourcing to accounting firm
Outsourced accounting services cost $300–$800/month, depending on business complexity. They offer professional support at lower cost and greater flexibility, helping small businesses focus on core operations. While there may be security risks, choosing a trustworthy firm with strict contracts and confidentiality agreements can minimize them.
Conclusion
According to the SCORE report, small businesses typically pay $1,000 to $5,000 annually for accounting services. For individual accounting tasks, Investopedia states the average fee ranges from $146 to $457. If you have employees, consider hiring a part-time accountant to manage payroll. Contact us to learn more.