Is outsourcing your bookkeeping cheaper than doing it yourself?

Doing it yourself seems cheaper, because you do not get a bill. But the real comparison also counts your own hours, the risk of mistakes and the knowledge you do not have yourself. Research among SMEs shows that business owners rarely choose on price alone. They often keep routine work in-house and outsource specialist work. Knowledge and trust in the bookkeeper tip the balance more often than the rate.

In this article

1. How do you make the calculation between doing it yourself and outsourcing?
2. Which tasks do business owners usually outsource?
3. Why do business owners outsource if it is not about price?
4. Does outsourcing lead to better business results?
5. When is it better to do it yourself?
6. What remains your responsibility if you outsource?

How do you make the calculation between doing it yourself and outsourcing?

By counting all the costs, not just the bookkeeper's invoice. Doing it yourself costs your time, software and the cost of mistakes. Outsourcing costs a fee, plus the time you spend on coordinating, supplying documents and checking.

That second kind of cost is called transaction costs: the costs of working with another company. Economist Oliver Williamson showed that companies weigh up for every task whether to do it themselves or buy it in. The smartest choice is the one where production costs and transaction costs together are lowest (Williamson, 1981).

The biggest item when doing it yourself is usually your own time. An hour you spend on receipts is an hour you cannot spend on customers or your product. So count those hours at what an hour of yours is worth to the business, not at zero.

Which tasks do business owners usually outsource?

Mainly tasks that occur rarely and require a lot of expertise. A Belgian study of SMEs with 10 to 250 employees found a clear pattern. Tasks that keep coming back, such as booking invoices and the VAT return, were kept in-house by most companies. Closing a period and the annual accounts were often done together with an external accountant (Everaert et al., 2006).

The corporate income tax return (the tax on the profit of a private limited company) was most often fully outsourced: by 63% of the companies (Everaert et al., 2006). That study was a working paper with 126 participating companies. The related publication in a scholarly journal confirmed the pattern: the more often a task comes back, the less companies outsource it (Everaert et al., 2010).

Outsourcing is much more common in some countries. In a study in Montenegro, 75.4% of companies outsourced their accounting to a bookkeeping firm or external accountant (Tomašević et al., 2023). So how many business owners outsource also depends on the rules and the market in a country.

Why do business owners outsource if it is not about price?

To buy knowledge they do not have themselves, and because they trust their bookkeeper. In the Belgian study, price was not the main reason. Companies that outsourced everything did so mainly for outside expertise and trust in their accountant (Everaert et al., 2006).

A study of 658 Iranian manufacturing companies came to the same picture. Companies that trusted their external accountant more outsourced more. Companies with a lot of company-specific knowledge in their accounting outsourced less (Kamyabi & Devi, 2011a). By company-specific knowledge, researchers mean knowledge that only has value within your company, such as exactly how your projects are invoiced.

Those who keep their own books have another advantage: the figures are right at hand. In the Belgian study, companies kept the work in-house mainly to be able to monitor their finances themselves (Everaert et al., 2006). Larger SMEs did more themselves, smaller companies relied more on an external accountant (Everaert et al., 2006).

Does outsourcing lead to better business results?

There are signs that it does, but the evidence is limited. In the Iranian study, more outsourcing went together with better company performance (Kamyabi & Devi, 2011b). A smaller Australian study found that outsourcing tax work went together with better profitability and cost efficiency (Rezazade et al., 2023).

The same Australian study found no link between outsourcing ordinary bookkeeping and higher productivity. Outsourcing management accounting (figures for managing the business, such as budgets and cost prices) was linked to productivity (Rezazade et al., 2023). The study had only 80 participants. And a link is not proof that outsourcing is the cause.

The lesson: the return does not lie in handing over data entry, but in the knowledge you get back. A bookkeeper who only books saves you time. A bookkeeper who helps you with taxes and management can deliver more.

When is it better to do it yourself?

When the work comes back daily, requires a lot of knowledge of your own business and you have the time for it. It is precisely for these tasks that the costs of coordinating with someone else are high (Everaert et al., 2010). Think of keeping track of sales invoices, following up on who still has to pay and booking your bank transactions.

Many business owners therefore choose a middle way. They do the daily work themselves and leave the annual accounts, the tax returns and difficult questions to a specialist. In the Belgian study, sharing tasks in this way was very common (Everaert et al., 2006).

In doubt? Keep track for a month of how many hours you spend on the accounts, and how often you have to look something up or correct it. That gives a fairer picture than a gut feeling.

What remains your responsibility if you outsource?

Everything the law requires of you. As a business owner you are legally required to set up and keep proper records. You complete your tax returns on the basis of those records (Dutch Tax Administration, 2026). That does not change when a bookkeeper does the work for you.

The duty to keep records also stays with you. You keep the basic data of your accounts, such as the general ledger, the accounts receivable and payable and the purchase and sales records, for 7 years. Data about real estate you keep for 10 years (Dutch Tax Administration, 2026).

So make clear agreements. Record who does what, when you supply documents and where the records are kept. That way you avoid a gap between what you think the bookkeeper does and what he actually does.

Sources

• Williamson, O.E. (1981). The economics of organization: The transaction cost approach. American Journal of Sociology, 87(3), 548-577. doi.org
• Everaert, P., Sarens, G. & Rommel, J. (2006). Sourcing of accounting: Evidence from Belgian SMEs. Working paper 06/403, Ghent University (not peer-reviewed, used as a supplement). ideas.repec.org
• Everaert, P., Sarens, G. & Rommel, J. (2010). Using transaction cost economics to explain outsourcing of accounting. Small Business Economics, 35(1), 93-112. doi.org
• Tomašević, I., Đurović, S., Abramović, N., Weis, L. & Koval, V.V. (2023). Factors influencing accounting outsourcing using the transaction cost economics model. International Journal of Financial Studies, 11(2), 61. doi.org
• Kamyabi, Y. & Devi, S. (2011a). An empirical investigation of accounting outsourcing in Iranian SMEs: Transaction cost economics and resource-based views. International Journal of Business and Management, 6(3), 81. doi.org
• Kamyabi, Y. & Devi, S. (2011b). Accounting outsourcing and firm performance in Iranian SMEs. International Journal of Economics and Finance, 3(4), 181. doi.org
• Rezazade, F., Minutillo, S. & Patel, N. (2023). Accounting outsourcing and its relationship with financial performance of SMEs: Manager and employee perspectives. South African Journal of Accounting Research, 37(2), 106-121. doi.org
• Belastingdienst (Dutch Tax Administration) (2026). Setting up records for your tax returns. Consulted 14 October 2026. belastingdienst.nl
• Belastingdienst (Dutch Tax Administration) (2026). How long must you keep your records for VAT: 7 or 10 years? Consulted 14 October 2026. belastingdienst.nl