Small accounting practices that cannot afford to hire can use outsourcing services to manage bookkeeping, VAT returns, payroll and year-end accounts without committing to a full-time salary. Outsourcing services have proven themselves very dependable for multiple small accounting practices when it comes to handling their additional workload without requiring additional recruitment.
To understand the importance of outsourcing services, we will put you in a situation. When your client base expands fast, you will face a bookkeeping pile-up, difficulties in meeting VAT deadlines, and be forced to have your staff work late nights to complete year-end accounts. Hiring an accountant may seem a great idea, but permanent salary costs must be taken into consideration.
Hiring will provide you the expertise and capacity but will also increase your financial costs like recruitment costs, employer National Insurance, pension contributions, training and ongoing management.
So, what options do you have? Outsourcing certainly.
Outsourcing services will handle the recurring accounting work without you needing to hire another employee. The key is choosing work that can be delegated while your practice retains client relationships, review and final decisions.
Let’s understand more about outsourcing through this blog.
Why Hiring Full-Time Staff Is Becoming Difficult for Small Practices
For a small accounting practice, hiring an accountant is costly and getting the right one is even more difficult. The cost of a salary can be quite burdensome when your extra workload is seasonal.
Recruiting the right talent is a challenge for UK accounting practices. In the ICAEW research Evolution of Mid-Tier Accountancy Firms, 56% of surveyed firms identified attracting and recruiting qualified staff as a key talent challenge
Also, the cost of hiring goes beyond salary. For the 2026/27 tax year, employers generally pay National Insurance at 15% on earnings above the £5,000 annual secondary threshold, subject to applicable rules and reliefs. You will also need to budget for pension contributions, recruitment, software and training.
You could think of handling the hiring cost if the workload is high and consistent enough, but if not, then you will have to think of other options.
Which Outsourcing Services Can Small Accounting Practices Use?
The ideal outsourcing arrangement will depend on the problems you are trying to resolve. Through the following examples, you can identify the issues you face and make your outsourcing decision.
The best outsourcing service for you will be the one that resolves all your issues. Let’s go through some examples.
- If bookkeeping is falling behind: Do outsource the transaction processing and reconciliations.
- If VAT deadlines are becoming problematic: Outsource VAT preparation while retaining review and submission controls.
- If payroll takes too much time: Let your outsourcing partner handle routine payroll processing with a specialist team.
- If year-end creates a bottleneck: Outsource working papers and defined accounts preparation tasks.
- If your workload changes each month: Get yourself an outsourcing provider that offers pay-as-you-go services.
- If you have a temporary backlog: You can use project-based support until the work is cleared.
Equallto’s pay-as-you-go accounting services are quite reputed among small accounting practices. It allows practices to access accounting capacity when they need the most.
What Are the Benefits of Outsourcing Services for Small Practices?
The major benefits of outsourcing services include access to instant flexible capacity, reduction in workload, access to expertise, and much more. Let’s understand the benefits in detail.
Let’s understand each benefit in detail.
Lower Fixed Employment Commitments
You will be paying for the agreed services or workload instead of carrying the costs of another full-time employee. Whether this saves money depends on the provider’s fees, the work involved and your internal review time.
More Capacity During Busy Periods
Get more immediate capacity during the self-assessment period or during increased VAT work, which is not possible through recruitment.
More Time for Clients
With the outsourcing of recurring accounting tasks to your provider, your staff will have more time for client meetings, tax planning, advisory services, and business development. All these activities are high-value, profit-generating, and develop new business connections.
Access to Specialist Skills
Professional outsourcing providers have experienced accounting teams with experience in handling bookkeeping, payroll, accounts preparation and accounting software that would be difficult to recruit for in one person.
Less Dependence on One Employee
Rather than depending on a single employee to handle an entire accounting process, you can depend on your outsourcing staff as a backup, provided a clear brief is given.
Flexible Growth
You can reduce or increase the scope of work you want to outsource based on your client base and workload instead of depending on recruitment.
Outsourcing Services vs Hiring: Which Option Is Right for Your Practice?
It’s easy to do an outsourcing services vs hiring but finding out which one is the best is difficult. Let’s do a comparison.
| Factor | Hiring an employee | Using outsourcing services |
| Cost structure | Salary plus employment and operating costs | Fee based on agreed work or capacity |
| Workload | Best suited to consistent demand | Can suit recurring, seasonal or project-based demand |
| Recruitment | Requires advertising, selection and onboarding | Requires provider assessment and onboarding |
| Skills | Depends on the person recruited | May provide access to a wider range of skills |
| Management | Direct day-to-day management | Managed through agreed processes and service expectations |
| Flexibility | Changes may require restructuring or further recruitment | Scope may be adjusted according to the agreement |
Make an analysis of the annual workload and include the entire hiring cost along with salary cost, which includes national insurance, pension contribution, recruitment costs, and so on.
Then compare that figure with the provider’s fee, internal review time, onboarding costs and any additional software or communication requirements. You will come to a better conclusion.
What Should You Look for in an Outsourcing Services Provider?
The right outsourcing service provider should meet your requirements and not force you to rebuild your systems around theirs.
That’s why before committing, check these six areas:
1. Relevant Accounting Experience:
Identify providers with experience in working with practices, HMRC processes, and UK accounting standards before you intend to delegate.
2. Clear Responsibilities:
Choose an outsourcing partner who prepares, reviews, approves and submits each item. Avoid outsourcing client-facing tasks and final decision-making.
3. Software Compatibility:
Confirm the provider can work with your systems, such as Xero, QuickBooks or Sage, where relevant.
4. Data Security:
Verify their data security measures like their access controls, document sharing methods, staff training, and data protection procedures.
5. Quality Checks:
Check their review stages, error reporting, turnaround times and a process for resolving queries.
6. Flexible Pricing:
Understand whether you pay per task, per hour, per month or through a pay-as-you-go arrangement. Check minimum commitments and additional charges.
Go for a pilot test with a small sample of your tasks to review the quality and communication, and expand only when the arrangement works for your team.
How Equallto Helps Small Accounting Practices Scale Without Hiring
Equallto has made its name amongst small accounting practices that need additional capacity without building every function in-house through its outsourced accounting services.
It has adopted a flexible approach to adjust to each practice’s unique needs. This can include bookkeeping, year-end accounts preparation, payroll and other recurring accounting tasks.
Rather than hiring an accountant for a workload that may fluctuate, your practice can explore a service model that matches the volume of work required. Your team can retain client relationships and review responsibilities while agreed production work is completed externally.
Explore Equallto’s accounting outsourcing services to see whether flexible, output-based support fits your practice’s workload and budget.
People Also Ask
Is outsourcing cheaper than hiring an accountant?
It can be, particularly when you need help with specific tasks or seasonal workloads. However, the actual cost depends on the provider’s fees, the volume and complexity of work, and the time your team spends managing and reviewing it. Compare total costs before deciding.
Can a small accounting practice outsource only certain tasks?
Yes. You can outsource one task, such as bookkeeping or payroll, or delegate several processes. Starting with a defined workload lets you assess quality and communication before expanding the arrangement.
What outsourcing services can accounting practices use?
Common options include bookkeeping, bank reconciliations, VAT preparation, payroll, year-end accounts, management accounts, accounts preparation, catch-up bookkeeping and tax preparation.
What is outsourcing accounting services?
Outsourcing accounting services is the practice of hiring an external firm or specialist to manage a company’s financial, bookkeeping, and back-office accounting operations instead of building a full-time, in-house department.
Conclusion
There is no need to keep all your accounting work in-house and burden your staff to save the cost of recruiting new employees. You have the option of outsourcing services, which will be handy during busy periods so that you don’t have to divert any resources away from high-value client relationship work.
The sensible first step toward outsourcing is to identify the work creating the biggest bottleneck, calculate what hiring would really cost and compare it with a flexible alternative.
Need more capacity without another permanent hire? Explore Equallto’s flexible accounting services. Contact us and find a model that fits the way your practice works.
