Skip to content

EXPENSES •  24 NOVEMBER 2022 • 5 MIN READ

The cost of getting an accountant for your small business in New Zealand

Female with calculator and diary

Dealing with accounting can be tedious and stressful, but it’s necessary chore for every small business owner. It can be challenging to balance your business, maintain good accounting records, analysing financial statements, and complying with tax deadlines. Hence, hiring an accountant is a wise decision. Although it’s considered an overhead expense, paying an accountant ensures that your finances are in check, comply with the law, and often save you far more in tax that you spend on the accountant’s fees.

The cost of an accountant in New Zealand ranges from around $1,000 to $5,000 per entity per year, this could be either a fixed monthly fee or an hourly charge (vary from $100 to $800). However, other factors, such as the scope of the work and the accountant's experience and expertise must be considered as well.

What’s the difference between a bookkeeper and an accountant?

Bookkeeping and accounting are integral parts of your business’s finances. Many business owners think they are one and the same, however, there are a few key differences.

A bookkeeper is typically involved in recording business day-to-day transactions (e.g., payroll, invoicing, payment of bills etc). Their job is more repetitive. It does not require a lot of high level knowledge or experience to be a bookkeeper. Normally, university graduates or business administrators with some training can take on the job. Their main focus is to make sure the accounting records are completed and up to date. 

However, an accountant provides insights based on the information key financial data. Depending on their experience and knowledge base, they can provide you strategic advice, tax planning for the future and more. They review the business’s financial statements, budget for the coming year, prepare and file tax returns with IRD, and analyse business performance for you.

What factors affect accountant costs?

The cost of an accountant commonly depends on several factors such as business size, expertise, business timing, experience level, level of accounting support you need, the tidiness of record keeping, and location.

Business size

The general rule applies when it comes to the cost of a small business accountant: the bigger and more complex your business is, the more the accountant needs to review. Compared to a small business that is operating under a sole trader structure, larger companies may likely have more transactions. For example, if you own a residential property vs own a popular restaurant in CBD; the amount of the transactions in a year is different. This means accountants need to spend more time reviewing and filing your tax returns. 

At Beany, our are based on your business's gross annual income. You can opt in for Form Package with a monthly fee of $139 (GST exclusive) if your annual gross earning is up to 250k. If your income exceeds this threshold, you can choose other packages such as Flow or Flex. 

Expertise 

Some accountants have vast experience in specific industries (e.g., construction, farming, real estate). For example, the cost of hiring an accountant specialises in the construction industry might be higher due to its complexity. Not only do they have to know and comply with specific laws and regulations, but also they need to have an in-depth understanding on ring fencing, inventory, and bright-line rules. 

Business timing 

If you’re looking for an accountant closer to the date when your tax is due, the cost can also increase. Consult an accountant prior to filing so you avoid the stress of cramming and the extra cost of expediting the process. 

Another option is to hire an accountant who offers fixed monthly fees. For example, Beany breaks your accountant fees into 12 months and you’re guaranteed to pay a fixed monthly fee. The packages offer tax return service plus returns for 2 shareholders. Besides, completing and filing Companies Office annual returns is also included. 

Your accounts are in good hands with Beany, we’ll send you an alert and your dedicated accountant will do everything you need after completing the hassle-free questionnaire (You save time sending heaps of paperwork to your accountant!).

Experience level  

Experience plays a role in how much an accountant costs. A certified accountant with more experience will be more expensive. Although you can choose to use a less expensive accountant, be sure to do your due diligence to see if they meet your expectations. In NZ, the commonly recognised certification for accountants are CAANZ. Be sure to find a good Chartered Accountant. They may appear to be expensive to start with, but in reality, the services they provide to you may save you more on tax or increase business sales. 

Level of accounting support 

If you need more support from your accountant, that will obviously push the fee up. If you have no idea about accounting, you are likely need more help from your accountant to teach you from the basic GST ruling, bank reconciliation and so on. However, if you have been in business for many years, you may already know all the tax deadlines, xero functions, which requires less help from you accountant.

Businesses operating under different business structures have an impact on the level of accounting support you need. Sole traders won’t need the same level of support as a business operating under trust or company structures.  The bare minimum support you need from your accountant is to meet compliance with IRD. However, if you’re running a small business as a sole trader, your accounting and tax requirements will be more straightforward than trusts or companies. You can read more on business structure in this article.

Tidiness of records

The better you keep your records tidy and up to date, the cheaper your accountancy fee will be. Some business owners have the idea to dump all information to the accountant at the year end, and expect things to be tidied up nice and quick. It can be done, but it will also be more costly. As more time and effort is spent digging into the records. 

Also, it is important to remember it is your business to start with. We generally find business owners with good record keeping and willingness to learn accounting knowledge will have good business results and keep accounting fees low. With the help of technology, it isn’t that hard. When you make a large purchase, simply take out your phone and take a photo of the invoice, and upload that to Xero straight-way. This can reduce the work for your accountant at the year end, asking you about an invoice back in November 2021, which you will find hard to recall what you brought and where the invoice was. 

Location

In general, it is cheaper to find an accountant in a big city, e.g. Auckland, compared with a smaller town. There are more competitions in a big city, which can push down the accountancy fee. However, the key isn’t to find the cheapest one, but the best one at a lower cost. 

Tess, Problem Solver

Got any questions about Beany?

Chat to one of our friendly problem solvers today to get clarity.

Do I need an accountant for my small business?

It is common for small business owners to believe that they don't need an accountant if they’re using accounting software. But the truth is: it is better to have both. Technology certainly helps, but hiring an accountant will ensure you're properly guided and compliant with laws and regulations. Having them on board not only can help you improve your financial systems, but also eliminate the headache when it comes to understanding the nuances behind the key numbers and enabling you to grow your business further. 

Who are Beany? 

We’re an online accounting firm that is always right here for you, your accounting pain relief. The most advanced technology lets us work way more closely with you than a normal accountant world. ​

We have a dedicated team of certified accountants and a support team to take care of your business no matter where you are, so you can focus on growing your business. We take out the ‘fluff’, break down the barriers and get things done. Looking out for you is what we are all about. Get started for free today.

Tori as a dog

Tori Ma

Performance marketer

Performance marketer at Beany, and into true crime documentaries.

subscribe + learn

Beany Resources delivered straight to your inbox.

Beany Resources delivered straight to your inbox.

Share:

Related resources

View all resources
View all resources