How Much Should You Pay Your CPA

When hiring any new person on your team, one of the first things you’re likely to think about is whether you will be able to afford the person you are attempting to hire. While there is no perfect way to determine how much you should pay your CPA, here is a list of criteria which should help you through the decision-making process.

Hourly

Hourly rates can vary dramatically based on your location, the services you can provide and your experience. While lower hourly rates are great, they don’t necessarily indicate better value. A more experienced accountant may charge more money, but then complete the task in half the time. Remember, you will always get what you pay for.

Proposal Basis

Before beginning work, most CPAs offer their clients an estimate of what their total cost will be for the entire project. Once an estimate has been given, the accountant will prepare a proposal that will estimate how long the tasks will take and then multiply the number of hours required by the hourly rate so that the client will know exactly how much money they will be paying up front. Instead of waiting to see what the invoice says, you’ll know what to expect right away.

Fixed Fee Structure

There will be several tasks which will require ongoing assistance from your CPA, such as: balancing books, payroll and posting transactions. Most of these tasks have a structured fee, meaning there’s one set cost each time these tasks are completed.

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