I am in the process of starting my own business up on a self-employed basis. I am wondering if anybody has some advice they could give me regarding rates of pay per hour.
Hi.
This is a very difficult question to answer.
Most depends on each individual client.
You want to be earning, after expenses, at least 15-20 per hour. In this game, you'll spend half your time learning new rules, regulations, and most definitely new tax laws as they come about.
Account for time spent marketing, etc.
As an estimate, you'll be looking at 300 - 500 for each self employed client. 100 - 200 for a simple, dare I say....SA, eg, Avon lady, driving instructors. Guy who rents one house. For limited, small Ltd, double it. Add in payroll, charge a little more. The more you do, the faster you will become, so let's say in 12 months, your efficency will create you its own wealth. Slow and steady.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
You want to be earning, after expenses, at least 15-20 per hour. In this game, you'll spend half your time learning new rules,
Hi John
Surely that depends on the area? Whilst rates in an affluent area will obviously be more say £25-30 ph top line, You would be hard pushed to get £20 ph in a depressed area.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
The price is based on fixed rates, to include SA. I doubt you'd find a babysitter in this day and age for £20 ph
If people are charging <£20 Per hour for a full service, then they are seriously under valuing their services. Visit a chartered practice, you'd be looking at £50 per hour, for the junior to be completing sole trader work. ( Tongue in cheek )
-- Edited by abacus12345 on Tuesday 9th of February 2016 10:55:19 PM
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
Again, it depends on the area. £20 an hour for a babysitter? That's at least £60 probably £100 before you've even gone out. I'm so glad my son has grown up!!
I used to babysit for £5 a night lol, but that was back in the mid 70's
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
If people are charging <£20 Per hour for a full service, then they are seriously under valuing their services. Visit a chartered practice, you'd be looking at £50 per hour, for the junior to be completing sole trader work. ( Tongue in cheek )
Sorry John, are we talking bookkeeping or accountancy here? I had assumed (wrongly possibly) that Julia was referring to bookkeeping. If it's accountancy we're talking about then obviously £20 an hour would be seriously undervaluing your services.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
That baysitter analogy reminds me of the person that we had on here some time back who was both a cleaner and a bookkeeper.
Eventually they gave up bookkeeping to concentrate on the cleaning as whilst busineses had no issue paying someone £15 per hour to clean the offices the clients always complained about paying for a bookkeeper no matter how low the rate.
The issue I fear is that we are seen by too many as an overhead rather than a benefit to the business.
(Lol on the office junior line... Many a true word spoken in jest!)
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
If people are charging <£20 Per hour for a full service, then they are seriously under valuing their services. Visit a chartered practice, you'd be looking at £50 per hour, for the junior to be completing sole trader work. ( Tongue in cheek )
Sorry John, are we talking bookkeeping or accountancy here? I had assumed (wrongly possibly) that Julia was referring to bookkeeping. If it's accountancy we're talking about then obviously £20 an hour would be seriously undervaluing your services.
How many bookkeepers actually realise where bookkeeping stops?
How many clients realise that there is a difference between bookkeepers and accountants?
Bookkeepers are quite often expected by micro businesses to be cheaper accountants. Indeed, that now seems to be the market that the (innapropriately named) bookkeeping bodies are actually aiming at.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I agree that the lines are blurred between bookkeeper and accountant but I think a bookkeeper who wants to make a decent living (what a decent living is will probably vary from person to person but I would suggest a minimum of £30k profit p.a. pro rata?) needs to be proficient in simple tax work and should strive to be able to get a set of accounts and a tax return prepared for sole trader clients at the very least. Anything less will be quite restrictive in building a business (I realise not everybody wants to build a business and it can be a lifestyle choice too) and you end up just having a job. With that in mind Juno, I would try to get away from an hourly rate (back to having a job rather than a business??) and go with John (Abacus) and where possible quote a fixed rate. Suddenly that £15 per hour rate that the client wasn't happy with can be closer to £30 and the client snaps your hand off, even in the less affluent areas (I'm in Coventry).
If people are charging <£20 Per hour for a full service, then they are seriously under valuing their services. Visit a chartered practice, you'd be looking at £50 per hour, for the junior to be completing sole trader work. ( Tongue in cheek )
Sorry John, are we talking bookkeeping or accountancy here? I had assumed (wrongly possibly) that Julia was referring to bookkeeping. If it's accountancy we're talking about then obviously £20 an hour would be seriously undervaluing your services.
How many bookkeepers actually realise where bookkeeping stops?
How many clients realise that there is a difference between bookkeepers and accountants?
Bookkeepers are quite often expected by micro businesses to be cheaper accountants. Indeed, that now seems to be the market that the (innapropriately named) bookkeeping bodies are actually aiming at.
Fair point Shaun, and my market is specifically aimed at the small business. Small businesses haven't got shed loads of money to splash around and that's going to be more true as the new 025 minimum wage kicks and AE kicks in. I know strictly speaking a bookkeeper stops at trial balance, and as you know I go all the way and offer a full service. I'll admit that my fees are sub £20 an hour, and maybe that is too low, but I know that in the area I do most of my work, it's about right.
@ John
It would obviously depend on how many hours bookkeeping involved but based on approx 10 hours it would be £230. If the plumber just brought his books in, already completed on software, it would be £125, assuming they were reasonably ok. That's a set price, so does work out at more than my normal "hourly" rate. (All my work is carried out on a fixed fee basis)
If I was an accountant then the fees would be higher, but then that's because I've put the extra training and the time in to gain an accounting qualification.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Fixed fees are the way to go. You'll end up in time becoming faster at what you do, thus earning more money. Hourly rates just don't work, unless you can claim to be chartered, and work for real SME, not micro entities. There are only so many hours in a day. If you spend 40-50 hours on your business each week, not all of those hours can you bill for. Surely, if you bill £15 per hour, after expenses, stress, CPD, exams, you'd be better off as 1) a window cleaner 2) working in a warehouse. There is absolutely nothing wrong with either of those jobs, but my point is, this is a professional trade. Charge what your worth. This is business after all.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
St. Peter, of course, is there, looking through the files and asking a few quick questions.
"What sort of accountant were you?"
"Oh, I was a ICAEW", was the reply.
"Name?" asks St. Peter.
The accountant gives his name and St. Peter finds his file.
"Oh yes, we've been expecting you. You've reached your allotted time span."
The accountant says, "I don't get it. How can that be? I'm only 40 years old."
Peter looks again at the file and says, "Well, that's impossible."
"Why do you say that?" asks the accountant.
"Well," says St. Peter, "we've been looking over your time sheets and the hours you've charged your clients. By our reckoning, you must be at least 93 years old!".
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
