The verdict in three sentences
For a 35-person accounting practice in London, custom practice management software costs between £35,000 and £78,000, compared with £14,000 to £32,000 a year for off-the-shelf licences. Custom becomes worthwhile once the firm has its own processes (engagement letters per service line, time tracking per client job, a production dashboard) that packaged tools force staff to work around with Excel. With Making Tax Digital for Income Tax rolling out from April 2026 for sole traders and landlords above £50,000, this is the right moment to rethink the internal tool rather than bolt on yet another module.
What a 35-person practice pays today
Most London practices of this size combine a production suite (IRIS, CCH, Xero Practice Manager or similar) with a practice management layer billed per user. The real cost hides in double entry: the engagement letter is drafted in Word, the hours budget tracked in Excel, fee invoicing done separately.
| Item | Off-the-shelf (2026 estimate) | Custom |
|---|---|---|
| Practice management licence | £35 to £75 per user per month | £0 licence |
| Annual cost for 35 users | £14,700 to £31,500 | Hosting and maintenance £5,000 to £10,000 |
| Initial build | £0 to £4,000 configuration | £35,000 to £78,000 |
| Engagement letters | Generic templates | Generated per service type, e-signature |
| Time tracking | Separate entry | Linked to the job and the engagement letter budget |
| Production software integration | Partial, vendor-dependent | Custom API or scheduled export |
| Go-live time | 1 to 2 months | 4 to 6 months |
Over five years, a firm paying £26,000 a year in licences spends £130,000. A custom build at £56,000 plus £8,000 a year of maintenance comes to roughly £96,000 over the same period, and the firm owns the tool.
The modules that justify a custom build
Not every module deserves rebuilding. Accounts and tax production stays in the existing suite: that is the vendor's core job, and rewriting a tax engine makes no sense. Custom work focuses on the practice management layer.
| Module | Indicative 2026 budget | Measured gain |
|---|---|---|
| Engagement letter and variation generator | £7,000 to £13,000 | 45 min saved per letter |
| Time tracking per client and job | £8,500 to £17,000 | 1 to 2 h per staff member per month |
| Production dashboard (VAT, CT600, self-assessment deadlines) | £7,000 to £15,500 | Missed deadlines halved |
| Fee invoicing and chasing | £5,000 to £12,000 | Debtor days down 10 to 20 days |
| Production software connector | £4,300 to £10,000 | No more duplicate client records |
| Client portal (document upload, e-signature) | £7,000 to £14,000 | 30% fewer emails |
The regulatory point to plan for: MTD for Income Tax requires quarterly digital updates from April 2026 for qualifying sole traders and landlords, with the threshold dropping to £30,000 in April 2027. For a practice, that means many more recurring deadlines per client. A custom dashboard can pull those quarterly obligations from HMRC's API and display them alongside VAT and corporation tax deadlines.
Mini case study
Claire, partner at a 35-person accounting practice in Farringdon, London, pays £27,000 a year in practice management licences. She gets a quote for a custom tool at £58,000, plus £8,500 a year for maintenance and hosting.
The estimated time saving is 4 hours per staff member per month. Across 35 people, that is 140 hours a month, or 1,680 hours a year. Valued at an internal cost of £40 an hour, that represents £67,200 a year of freed time, which can be redirected to billable advisory work.
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Licence savings: £27,000 - £8,500 = £18,500 a year. Total annual gain: about £85,700. The £58,000 project pays for itself in just over 8 months after go-live.
FAQ
Should we replace our tax and accounts production software with a custom tool?
No. The production engine stays with the vendor, which tracks tax changes every year. The custom build covers practice management (engagement letters, time, billing, client portal) and connects to your production suite for a budget of £4,300 to £10,000.
How long does a project take for a 35-person firm?
Allow 4 to 6 months: 3 to 4 weeks of scoping, 3 to 4 months of development in releases, then 3 to 4 weeks of testing and data migration. The first modules (engagement letters, time tracking) can go live from month three.
How does the tool handle Making Tax Digital?
It connects to HMRC's MTD APIs to read client obligations and deadlines, and can feed them into the production dashboard. Filing itself stays in your HMRC-recognised software. This connector usually accounts for £3,500 to £7,000 of the budget.
Is client data UK GDPR compliant?
Yes, if hosting is in the UK or EU, with encryption, access logging and role-based permissions. A UK-based ISO 27001 hosting provider costs £250 to £700 a month for this volume.
Is a 3 to 5 hour saving per staff member realistic?
It is a 2026 order of magnitude seen when duplicate entry between Word, Excel and production software is removed. Across 35 staff, even the low case of 3 hours means 1,260 hours a year.
Let's scope your project. We work with you on your practice's priority modules (engagement letters, time, billing, client portal), with an indicative budget of £35,000 to £78,000 and go-live in 4 to 6 months. Detailed quote within 48 h. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
