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Banknotes AccountingWEB How much are you charging for a tax return?
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How much are you charging for a tax return?

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With 90% of UK accountants charging between £126 and £400 for a tax return, do you fall somewhere in between or buck the trend?

20th May 2024
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Pricing has always been a popular topic on AccountingWEB, especially in our Any Answers community. It’s a subject that constantly sparks debate and interest among accountants.

IRIS recently surveyed UK accountants looking at how much they charge for a range of services, including a tax return. 

It shared that 90% of accountants charge between £126 and £400 for a tax return. This seems to be the sweet spot for most, reflecting what accountants believe is fair for their location, time and expertise.

The remaining accountants charge between £400 and £600, and then there’s the 1% who charge more than £600 for a single tax return. 

What is the community charging?

One community member, WinterDragon, highlighted the challenges of competing with online prices after he had found a self assessment tax return for just £20.

“If this is what the rest of you are charging then I tender my resignation with immediate effect as I refuse to join this race to the poverty line,” he said.

Unsurprisingly, this seems to be a one-off price and definitely not what the Any Answers community is charging. 

An Any Answers that was posted last year by m.wardle2 asked: “Does anyone fancy being open about what they charge for a tax return these days?”

Despite being over a year old, the answers seem to match IRIS’ survey results. 

The lowest price mentioned was by CardiffAccountant, who said: “Straight forward directors return (PAYE plus dividends), starts at £75. Straight forward self-employed accountants and return is £360.”

Regular commenter, Tornado, was the highest charger.

“Generally I will not take on any new client for less than £500 plus VAT for anything. For me, it is all about quality rather than quantity. I treat each tax return at a cheap rate as more of a potential liability than an asset.”

In general, the most common price range for a tax return seemed to be between £250 and £400, with many members mentioning prices within this range.

Differing factors 

Pricing for tax returns among UK accountants therefore varies widely depending on many different factors, one being geographical location. For example, one member, Open all hours, who works in “a very rural Yorkshire”, said that they charge £150, whereas Justin Bryant added: “I doubt any City of London regulated firm would charge less than £350 (plus any VAT) even for a simple SA100 (and even then that would likely be mates rates).”

Another factor that came up was whether a client was new or long-standing.  Many accountants mentioned that they have long-standing clients who benefit from older, lower rates that haven't been updated.

AccountingWEB commenter, Paul Crowley, said: “I still have quite a few below £250, which are legacy clients. My £250 start point for a new client has been stagnant for some years so I had decided during January that the starting point would be £300.”

Another member, Bendybodbendybod, agreed: “Elderly clients with whom we've had a long working relationship, probably more like £250.”

What factors influence your pricing decisions for tax returns, and where does your fee fall within this range? Are you the 1% that charges over £600? Let us know in the comments.

Replies (27)

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Tornado
By Tornado
20th May 2024 12:34

I don't have a set price for a Tax Return, it all depends on how long it takes to complete.

My minimum charge for anything is about £300.00 (plus VAT) and then upwards to several thousands of pounds.

I know that a lot of Accountants use fixed rates, but I firmly believe that working to fixed rates can result in corners being cut and increased risk of mistakes. I still use discretion in making my final charges if I have taken longer to be sure of my facts than may have been necessary, but I do not complete Tax Returns unless I have been diligent in information gathering.

Thanks (15)
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By Paul Crowley
20th May 2024 20:34

This is really a new client thing.
Client usually wants to know the full cost, so it really depends upon what is needed to make up the return.
My start price is £3oo plus VAT.
One or two easy letting properties could be included, or a small self-employment would be possible to include. But the records must be easy to follow.
Thereafter it is a matter of predicting the time expected over the full year.
The problem is that small jobs have an exposure and just an hour of extra time can make them less economic than bigger predictable jobs.
New clients in Dec to Jan can expect higher fees.

Thanks (5)
Replying to Paul Crowley:
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By FactChecker
20th May 2024 21:04

"The problem is that small jobs have an exposure and just an hour of extra time can make them less economic than bigger predictable jobs."

Quite ... the bane of those with a majority of small clients is that an unplanned hour can wreck profitability of that client, whereas it barely touch the sides of a larger one.

And of course that's precisely why HMRC's current total incompetence (in replying to queries that often arise from their mistake) is SO painful - not just an aggravating waste of precious time, but pouring profits down the drain.

Thanks (17)
Replying to Paul Crowley:
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By WallyGandy
21st May 2024 09:06

Paul Crowley wrote:

This is really a new client thing.
Client usually wants to know the full cost, so it really depends upon what is needed to make up the return.
My start price is £3oo plus VAT.
One or two easy letting properties could be included, or a small self-employment would be possible to include. But the records must be easy to follow.
Thereafter it is a matter of predicting the time expected over the full year.
The problem is that small jobs have an exposure and just an hour of extra time can make them less economic than bigger predictable jobs.
New clients in Dec to Jan can expect higher fees.

Thanks (0)
Replying to WallyGandy:
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By WallyGandy
21st May 2024 09:09

Sorry for earlier misclick.... Higher fees AND payment either before work starts or before filed with HMRC, surely! I politely ask the "would be" client to look elsewhere. Usually Google.....

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By The Innkeeper
21st May 2024 07:03

For new cases minimum of £500 plus vat. The onboarding process and aml compliance does not make it worthwhile for anything less. If they are more complex returns anything up to £1000 plus vat or higher. We have given up on the race to the bottom for pita clients. If they don’t like the price they can go elsewhere

Thanks (7)
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By tim_g
21st May 2024 07:47

Should the next question be what work are you doing to complete a tax return?

Are there people just transferring p60 and dividend figures into the software, pressing send and charging £600 without asking any other questions, providing commentary or adding value?

Thanks (2)
Replying to tim_g:
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By Southwestbeancounter
21st May 2024 14:08

Yes that's the real question Tim.

We charge by time for accounts preparation etc and then the SATR would be separate but again based on time spent unless it was a stand alone tax return with no accounts preparation.

There are a couple of clients that we literally put P60, interest and dividend details on (with no accounts preparation etc) and our minimum fee for those tends to be between £110 & £175

Thanks (0)
Replying to Southwestbeancounter:
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By The Innkeeper
21st May 2024 14:18

How old fashioned to charge by time x hourly rate. Has nobody hear heard of value billing ?

Thanks (0)
Replying to The Innkeeper:
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By Southwestbeancounter
21st May 2024 17:11

Yeah well maybe, but it suits us to be 'old fashioned' as at least that way we can show the client how much time we expended on their accounts etc. if there was ever a query on our fee.

Thanks (2)
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By mkowl
21st May 2024 08:10

A lot of our SME clients where it is simply a case of transferring the information we have already produced its not charged - all gets wrapped up in the annual fees

For a standalone simple tax return its about £225 - £250 - which covers the processing and my review time. Having just got my Sage Taxation renewal quote then that is now coming in at £15 per submitted return so now pondering whether to identify that as a specific cost on the invoices where its not been built into the quote

I do go up to £750 for HNW clients

Thanks (1)
Replying to mkowl:
By ireallyshouldknowthisbut
21st May 2024 10:04

Wow on what SAGE are charging.

That is ridiculous. I would look at what else is on the market.

Thanks (2)
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By jackpot
21st May 2024 08:44

Our minimum fee is £750.

We do not look after any director/P60/dividend type clients. The majority are HNW/UHNW individuals with very complex tax affairs. Our client book includes a significant number of non-doms where the clients claim the remittance basis, so the returns can be very time consuming to prepare and review if remittances have been made.

Thanks (3)
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By Twickers Call
21st May 2024 09:16

We charge around £260 for rental accounts, paye income and the full tax return.

Thanks (0)
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By Self-Employed and Happy
21st May 2024 09:28

Minimum price is £175 + VAT, that is for a P60 and 1 rental property.

I think our highest charge is around £700 Ex Vat (but then you're talking Sole Trade Accounts), usually by the time they hit that price threshold they go Ltd anyway for tax / liability / other reasons.

If you have complicated ones that always cause a bit of hassle or need some CPD freshening up on a rule to make sure you get it right then they will always be charged more but we don't have any of those.

Thanks (0)
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By Ian McTernan CTA
21st May 2024 12:01

It really depends on what you mean when you say 'Tax Return'. Are we just talking about the actual Return or all the work that goes on all year to arrive at the figures that go in it?

I won't take on anything for less than £400 plus VAT these days (AML checks etc have added to the costs involved in onboarding).

Most of my self employeds are VAT registered...or became limited companies.

Not looking forward to quarterly reporting for my landlord clients in a couple years time their fees will definitely be going up, but it won't be such a shock.

Won't be so much fun for the guys currently charging a pittance for someone with 1-2 London property rentals when you need to do 5 reports a year...your clients might be in for a shock.

I would say for the majority of my clients I'm doing more than just completing the Tax Return once a year and that's built into my fee most of the time.

Thanks (2)
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By Jack the Lad
21st May 2024 12:03

The answer should be "How long is a piece of string"!
I'm with Tornado. It depends upon so many factors. I charge for setting up my file for new clients -- LoE, 64-8, etc, then a basic fee for simple processing, then additional fees for advisory work, and any time spent over and above the work included in the basic fee. It could be anything from £400 to much more. My hourly rate for tax work is £200 -- after 66 years of experience, I am worth it!

Thanks (1)
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By User deleted
21st May 2024 12:27

Being in the accounting industry, a discussion on pricing is a relevant and important one - thanks for sharing a blog on that. Competing with low prices is certainly a challenge. But we've found that for personalised services and our expertise, our clients are happy to pay, they understand the value we bring to the table.

Thanks (0)
stonks
By WinterDragon
21st May 2024 12:57

As others have pointed out, giving a price for a tax return is completely meaningless as the work involved in preparing one varies from one to the next-
However, I'd be lying if I said it wasn't one of the most common questions we receive from leads is "How much do you charge for a tax return?"

In order to answer that question we have set a price of £150+VAT. Almost none of our clients pay that price unless it really is the most basic of tax returns. The emphasis when giving that answer is that this price does not include preparing any figures to go into the tax return. The average fee for for just a tax return is typically £300-400 when factoring in the preparing of basic accounts for a sole trader (with good records).

I do feel torn between offering that low price to be able to answer the meaningless question but not getting caught up in drip pricing. Nobody enjoys the experience of buying a £15 flight but then an extra £60 to add a bag and a further £20 to secure seats that are next to each other.

As for the additional work in onboarding a new client, I've streamlined it as much as possible with templates and flowcharts to make most of it mindless admin and try to keep the initial meeting down to just one hour. If a potential client seems like they're going to need quite a bit of help then this will be factored into a quote.

Thanks (0)
Chartered Accountant
By bvijayakumarca
21st May 2024 13:03

The fee appears to be reasonable, if I convert it into INR. However, I am surprised that the fee (without conversion into INR) seems to be on low side. I believe that we should provide quality services that includes advices also and charge reasonably well.
In India, our Institute has recommended minimum scale of fees to be charged by the Chartered Accountants in practice for various professional services. The fee structure is available at https://cmpbenefits.icai.org/wp-content/uploads/2020/02/Details-download...
This is the benchmark used by us for charging fee to our clients. I hope that even in UK, such practice exists.

Thanks (0)
Replying to bvijayakumarca:
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By MartinLevin
22nd May 2024 16:04

if I convert it into INR.
What do those [infernal] initial letters stand for, please?

Asks: The GoodEnglish Professor, who deplores short-cuts - as they are not

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Replying to MartinLevin:
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By FactChecker
22nd May 2024 18:02

Not strictly speaking a 'short-cut' (or even an acronym) but, from the context, I'd assume it's the international Currency Symbol for Indian Rupee (like GBP for dear old Sterling).

Thanks (3)
Replying to FactChecker:
Chartered Accountant
By bvijayakumarca
22nd May 2024 18:39

You're right. INR stands for Indian Rupee. An international symbol like GBP, USD for currency

Thanks (0)
Replying to FactChecker:
Chartered Accountant
By bvijayakumarca
22nd May 2024 18:39

You're right. INR stands for Indian Rupee. An international symbol like GBP, USD for currency

Thanks (0)
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By Damon Williams
22nd May 2024 13:46

Great article, I think I can sympathise with a lot of what has been said here. With the idea of what exactly "a simple tax return" can entail, it's hard to come up with a base quote.

A good point made by Tornado with regards to some tax return only clients being more of a liability than an asset. I've experienced a "simple tax return" transforming into everything under the sun, including the kitchen sink, and the client being amazed that £120+VAT doesn't cover the work we have done for them.

Thanks (0)
paddle steamer
By DJKL
22nd May 2024 14:50

You are all ramping up your charges so that when I retire, and have to pay one of you to report my state pension, other pension, touch of interest , any unsheltered dividends I have and my gift aid payments, you can lift £400 plus vat from me every single year.

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Replying to DJKL:
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By FactChecker
22nd May 2024 17:56

... nah .. I've heard there's a website where they'll answer all your questions for free ... but really it's easy just to make up some numbers (so long as tax due = £0).

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