I’ve noted a steady stream of accountants asking the same question in online groups: “When should I increase my fees, and how do I even begin that conversation if I have not upped them for years?”
If you already review your fees regularly, don’t worry about this blog post.
It is, however, for you if you are like all the accountants who think they should review their fees more often than they do.
I’ve talked with accountants who have put off such conversations for two or three years, some who have left it a little longer and one who has a number of clients whose fees have remained the same for twenty years.
In each case what might have been a straightforward annual adjustment has turned into something where the accountant fears a confrontation, an admission of poor business practice or the loss of multiple clients.
Those fears are very natural even though they are often unwarranted. With a little encouragement and support we can ‘rip off the plaster’ and get on top of things. This often has the positive consequence of increased turnover and profits.
What clients are actually buying
In reality, much of that tension comes from a misunderstanding about what clients are actually buying. It’s NOT your time. It’s much more likely to be the peace of mind of knowing that their legal obligations to prepare and file accounts and tax returns are being dealt with. And, perhaps the valuable advice and insights they get on top of the compliance work.
Many accountants fall into the trap of linking their fees too closely to the time it takes to do the work. So when systems improve, or you become more efficient, it can feel as though the fee should stand still, or even come down. That sounds reasonable on the surface, but it quietly ignores how clients perceive value.
Your clients rarely see your processes. They are not tracking how long something takes you now compared to three years ago. What they experience is the outcome: compliance handled, problems avoided, questions answered, and a sense that things are under control.
Efficiency is your gain, not something that automatically belongs to the client. Just as inefficiency should not be their burden.
Why your costs are not your client’s concern
The same logic applies in reverse. If you decide to move from a home office into a more visible or professional space, that is a business decision. Clients do not expect to pay more simply because your costs have increased. Nor would they expect a discount if you move to cheaper premises or because you have found a quicker way to complete their accounts this year.
Once you separate fees from internal effort and overheads, the conversation becomes clearer. Fees are not a reflection of your costs; they are a reflection of the value and responsibility you carry for that client.
The hesitation around “catching up”
This is where the idea of “catching up” often creates hesitation.
If you have not increased fees for several years, introducing a meaningful rise can feel uncomfortable. There is a temptation to soften it, to phase it, or to justify it with a detailed explanation of rising costs or improved systems. In doing so, you risk reinforcing the idea that fees are negotiable or driven by your internal circumstances.
And there is the natural fear that some clients will choose to leave and seek a cheaper accountant. Maybe some will.
In reality it’s rare for an accountant to lose many clients when they review their fees; especially if they handle the communications with care.
Invariably the aggregate uplifted fees are greater than the total old fees – even after allowing for a few client departures. You can even model this before you have any conversations.
Here’s a simplistic example:
Assume an accountant has100 clients each paying fees, on average, of £1,200 a year. Total fee income £120,000
After a 4 year hiatus the accountant wants to increase fees by 15%.
If 10% of clients refuse and leave, the accountant’s total fee income is now: 90 x £1,380 = £124,200
That’s higher than before, they will have reduced pressure and potentially the capacity to go out and take on more new clients.A 10% loss of clients is probably extreme by the way.
A more useful question to ask
A more grounded approach is to step back and ask a simpler question: is this client commercially viable at the current fee? And to be fair the accountant who hadn’t increased some fees for 20 years, did think that most of the clients in question were worth retaining – even though they were getting a very good deal!
Answering the question means looking beyond the headline number. Consider the time involved, the complexity, the interruptions, and the level of responsibility you carry. Then compare that with the income you would expect to earn for all that, once overheads are taken into account.
If the answer is that the client isn’t commercially viable, you are not really deciding whether to increase fees. You are deciding whether to continue working at a loss.
Framed like that, the decision becomes less about confidence and more about commercial reality.
How clients actually experience fee increases
Of course, not every situation requires a dramatic adjustment. Some clients will comfortably absorb a modest increase, particularly if it is positioned as part of a regular review rather than a long-overdue correction. Others may need a more direct reset, especially where fees were set too low at the outset.
There is also a practical point here that is often overlooked. Most clients expect fees to rise over time. They see it everywhere else in their business and personal lives. What tends to create friction is not the increase itself, but the surprise of it after a long period of silence.
Regular, considered adjustments tend to feel far less confrontational than occasional, significant jumps.
Do note, by the way, that I have consistently referenced ‘reviewing’ fees rather than ‘increasing’ them, even though that may well be what happens most of the time. Words matter and how you present chnages to fees can impact how clients respond.
Deciding to have the conversation
The real issue, then, is not how to have the conversation. It is deciding that the conversation is justified in the first place.
Once you are clear on that, the tone naturally follows. You are not asking for permission, and you are not apologising. You are explaining how your fees will change and when. Some clients will accept that without hesitation. A few may question it. Occasionally, someone will decide to leave. And, you may want to fill the gap. That, of course, is a separate issue.
This is all part of running a commercial practice, not a sign that you have handled things badly.
What happens if you avoid it
Avoiding the conversation has a more predictable outcome. You end up with a portfolio that looks busy but delivers less and less in real terms, while the underlying pressure quietly builds.
At some point, something has to give.
Better that it is a considered decision about your fees than a slow erosion of your margins and motivation.
If this is something you have been putting off, it may be time to look at it with a fresh perspective and a more commercial lens.
Let’s talk.
