You know you need a bookkeeper. The question is: do you hire someone in-house or outsource to a firm?

Most business owners default to whatever feels more familiar. But when you run the actual numbers — not just salary, but the full cost of each option — the comparison often surprises people.

Here's an honest breakdown of what each option really costs and when each makes sense for a Canadian business.

The True Cost of an In-House Bookkeeper

When you hire an in-house bookkeeper, the salary is just the starting point.

Salary

In Canada, a full-time bookkeeper earns $40,000–$60,000/year depending on experience and location. In major markets like Vancouver, Toronto, or Calgary, experienced bookkeepers command $55,000–$65,000+.

Employer Costs (On Top of Salary)

• CPP employer contribution: ~5.95% of salary
• EI employer premium: ~2.21% of salary (1.4× the employee rate)
• Workers' Compensation: Varies by province, typically 0.5–2%
• Vacation pay: Minimum 4% (2 weeks), often more
• Benefits: Extended health, dental, RRSP matching — typically $3,000–$8,000/year

For a $50,000 salary, expect an additional $8,000–$15,000 in employer costs. Total: $58,000–$65,000/year minimum.

Software and Tools

Your in-house bookkeeper needs:

• Accounting software license (QuickBooks Online Plus: ~$100/month, $1,200/year)
• Computer and workspace
• Receipt management tool (Dext/Hubdoc: $30–$60/month)
• Payroll software if applicable

Hidden Costs

• Training and onboarding: 2–4 weeks of reduced productivity while they learn your systems
• Sick days and vacation: Coverage during absences (who does the books when they're away?)
• Turnover: If they leave, you're starting over — recruitment, onboarding, knowledge transfer
• Management time: You're supervising an employee, handling HR, doing performance reviews
• Single point of failure: One person with all the knowledge is a risk

Realistic Total: $60,000–$80,000/year

That's the real all-in cost for a full-time, in-house bookkeeper in Canada.

The True Cost of Outsourced Bookkeeping

Outsourced bookkeeping fees vary based on the complexity and volume of your business.

Monthly Fees

• Simple businesses (sole proprietor, <100 transactions/month): $300–$800/month
• Growing businesses (small team, multiple accounts, 100-300 transactions): $800–$1,500/month
• Complex businesses (multi-entity, payroll, inventory, 300+ transactions): $1,500–$3,000+/month

What's Included

A reputable outsourced bookkeeping firm typically includes:

• All transaction categorization and reconciliation
• Monthly financial statements
• GST/HST preparation and filing
• Accounts payable and receivable management
• Year-end preparation for your accountant
• Software licenses (often included in the fee)
• Backup coverage — you're never dependent on a single person

No Hidden Costs

• No CPP, EI, WCB, or benefits
• No office space, equipment, or software to provide
• No vacation or sick day coverage issues
• No recruitment or turnover costs
• No management overhead

Realistic Total: $3,600–$36,000/year

For most small-to-medium Canadian businesses, outsourced bookkeeping runs $6,000–$18,000/year — roughly one-quarter to one-third the cost of a full-time hire.

Side-by-Side Comparison

In-house bookkeeper: $60,000–$80,000/year

• Dedicated to your business full-time
• You manage and supervise them
• Single point of failure
• Handles high-volume, daily transaction work
• Fixed cost regardless of actual workload

Outsourced bookkeeper: $6,000–$36,000/year

• Scales with your actual needs
• Managed by the firm (not your problem)
• Team-based — no single point of failure
• Access to senior expertise when needed
• Variable cost that matches your business stage

When In-House Makes Sense

Despite the cost difference, in-house bookkeeping is the right choice in certain situations:

Very high transaction volume — If your business processes hundreds of transactions daily (retail, e-commerce with thousands of orders, high-volume food service), the sheer volume of work may justify a full-time person.

Complex daily operations — If your bookkeeper also handles inventory management, purchasing, or accounts payable/receivable that requires constant vendor communication, having someone on-site makes the work flow better.

Large company — Once you're past $5M+ in revenue with multiple departments, an in-house bookkeeper (or accounting team) becomes practical and necessary.

Sensitive or regulated industries — Some businesses prefer to keep financial data in-house for confidentiality or regulatory reasons, though reputable outsourced firms maintain strict confidentiality protocols.

When Outsourcing Wins

For most Canadian small and medium businesses, outsourcing is the clear winner:

You're under $2M in revenue — At this stage, you don't have enough bookkeeping work to fill 40 hours per week. You'd be paying a full-time salary for part-time work.

You want expertise without the salary — An outsourced firm gives you access to a team with diverse experience. Your in-house bookkeeper might be great at data entry but struggle with complex reconciliations or tax filings. A firm has specialists.

You don't want to manage another employee — Hiring, training, supervising, handling PTO, dealing with turnover — outsourcing eliminates all of this.

You need scalability — As your business grows, your outsourced bookkeeping scales with you. No need to hire additional staff, buy more software, or create an accounting department.

You want continuity — When an in-house bookkeeper quits, you're scrambling. When your outsourced firm handles transitions internally, nothing changes for you.

Real Example: The 20% Savings

One of our clients — a growing Canadian service business — was spending approximately $72,000/year on an in-house bookkeeper (salary + benefits + overhead). When they switched to Path 2 Profit's outsourced bookkeeping, their annual cost dropped to $14,400 while getting access to a broader team of specialists.

That's a 80% cost reduction — and the quality of their financial reporting actually improved because they now had access to senior expertise they couldn't afford to hire full-time.

Read the full story in our case study: Outsourcing Bookkeeping Services Saves 20%.

Making the Switch

If you're currently doing your own books or have an in-house arrangement that isn't working, switching to outsourced bookkeeping is simpler than most people expect:

1. We assess your current books and systems

2. We set up access to your accounting software and bank feeds

3. We bring your books current (if they're behind)

4. We take over monthly bookkeeping going forward

5. Your books are done, your reports arrive on time, and you move on to running your business

Book a Free Accounting Consult — we'll show you exactly what outsourced bookkeeping would look like and cost for your specific business. No obligation.