Over half of accounting firms to raise fees for services: Ignition
Ignition’s latest tax and compliance pricing data reveals that 55 per cent of firms plan to increase fees across all services this year.
Rising complexity and costs are driving accounting firms to increase fees across their services this year with 5 or 10 per cent the most common increase, according to a recent survey by Ignition.
Ignition’s 2024 tax and compliance pricing benchmark shows that 81 per cent of firms plan to increase prices for basic individual tax returns, while 87 per cent will increase prices for company or trust annual accounts and tax returns.
The survey results also indicated that 74 per cent plan to increase prices for tax planning, 55 per cent for annual corporate compliance and 74 per cent for BAS.
In terms of individual tax returns specifically, nearly 28 per cent of firms nationally charge $200 to $250 for individual tax returns. Over 27 per cent plan to increase fees by 5 per cent, while 23 per cent will up fees by 10 per cent.
For tax planning, nearly 35 per cent of firms nationally charge $500 to $750 annually for tax planning services. Around 26 per cent plan to increase fees by 5 per cent while over 24 per cent will up fees by 10 per cent.
In relation to business activity statements, nearly 39 per cent of firms nationally charge $250 to $350 for BAS, with 29 per cent planning to increase fees by 5 per cent, while 22 per cent will up fees by 10 per cent.
Over 37 per cent of firms charge $150 to $250 for annual corporate compliance. Just over one in five plan to increase fees by 5 per cent, while over 16 per cent will increase fees by 10 per cent.
“When it comes to tax planning, it's great to see that an increase in price is trending,” says Rebecca Mihalic, Director at businessDEPOT and Ignition’s APAC head of accounting.
“This service has been steadily moving from a ‘nice to have’ to a ‘need to have’ and has been undervalued for years. If you’re really rolling up your sleeves to work with your clients on interim accounts and tax planning, you need to charge appropriately.
“For BAS, it appears the overall pricing hasn't moved a lot in the last decade. I would have expected a greater percentage of firms charging more than $250.”
Ignition’s APAC managing director Dave New said when re-evaluating pricing strategies, it’s critical for firms to factor in fee increases within annual client engagements and renewals, and leverage technology to make the process more seamless and eliminate any awkward client conversations.
“Platforms such as Ignition enable customers to easily incorporate fee increases within their engagement letter terms as well as automatically increase prices when renewing client agreements,” said New.
