There is a point where hiring an accountant becomes cheaper than outsourcing, and almost every company that reaches it does so later than the owner expects. Below that point the argument is not close, and above it the argument is not really about money.
What each option actually costs
Outsourced monthly bookkeeping for an Estonian company runs from roughly €20 for a dormant company to €300 for a complex multi-country operation. Most companies under €5 million in revenue sit between €45 and €300 a month, so €500 to €3,600 a year.
An in-house accountant is not the salary. It is the salary plus employer social tax and unemployment contributions, plus recruitment, plus software licences you currently do not pay for, plus holiday cover, plus the management time of having an employee. In Estonia the loaded cost of a competent full-time accountant is comfortably into five figures a year.
The comparison people make is a monthly fee against a monthly salary. The comparison that decides it is the annual total against the annual total, including everything that comes attached to an employee.
The number that actually matters
Not revenue. Hours of accounting work per month. A consultancy turning over €900,000 with three clients, twelve invoices a year and two employees generates less accounting work than a €200,000 e-commerce store with four sales channels and 800 transactions a month.
As a rough guide:
- Under about 20 hours a month of real accounting work, outsourcing wins clearly. You cannot hire a fifth of a person, and a part-time hire at that level is usually someone doing bookkeeping without the depth to spot problems
- Between 20 and 60 hours, it is genuinely arguable, and usually depends on whether the work is predictable or bursty
- Above that, an in-house hire starts to make sense — but typically alongside an external accountant rather than instead of one, because the reason to hire is control and speed, not compliance
Where outsourcing is straightforwardly better
- You are under €1 million and not complex. The work does not fill a role, and the fixed fee is a fraction of a loaded salary
- Your volume is seasonal. An employee costs the same in your quiet months; a fee scales with what you actually generate
- You need range rather than hours. VAT, payroll, cross-border questions and the annual report are different skills, and one junior hire has some of them
- You do not want key-person risk. When your only accountant resigns in May, the annual report is due in June and nobody else knows where anything is
Where hiring genuinely wins
Not at a revenue number, but at a complexity threshold. Hiring makes sense when you need someone inside the business: managing a credit control process, sitting in on commercial decisions, building internal reporting that the operations team uses weekly, or handling volume that genuinely fills a week.
If your reason for hiring is that you want faster answers, that is worth examining first. Slow answers are usually a service problem rather than a location problem, and hiring is an expensive way to fix a responsiveness issue.
The middle path most companies land on
Between roughly €1 million and €5 million, the common arrangement is a bookkeeper or finance administrator in-house handling day-to-day entry, invoicing and chasing payments, with an external accountant doing month-end, declarations, the annual report and advisory. That combination is usually cheaper than a single senior hire and covers more ground than either option alone.
The question worth asking a provider
Not the price. Ask what happens when you have a question that is not routine — a client in another country, an unusual purchase, a restructure. Firms that price cheaply and bill advisory separately will answer that question differently from firms that include it, and the difference will cost or save you far more than the monthly fee.
Frequently asked questions
Is outsourced accounting cheaper than hiring?
For almost every company under about €1 million in revenue, yes, and by a wide margin. The relevant comparison is annual outsourced fees against a loaded employment cost including social tax, software, holiday cover and recruitment.
At what revenue should I hire an in-house accountant?
Revenue is the wrong measure. What matters is hours of genuine accounting work per month. Under roughly 20 hours, outsourcing wins clearly; above 60, an in-house hire starts to make sense, usually alongside an external accountant rather than instead of one.
Can I have both an in-house bookkeeper and an outsourced accountant?
That is the most common arrangement between about €1 million and €5 million. The bookkeeper handles daily entry and invoicing; the external accountant handles month-end, declarations, the annual report and advisory.
What is the risk of relying on one in-house accountant?
Key-person risk. If they leave shortly before a deadline, nobody else knows the systems, the passwords or where the documents are, and the cost of reconstructing that usually exceeds several years of outsourced fees.
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General information, not tax advice
This article reflects Estonian law as it stands on the date shown. Rules change and individual circumstances differ - confirm your own position with us before acting.