You're offline, showing the last version we saved.
Free template
Fee increase letter template for accountants
A fee increase letter does one job: it tells the client what changes, from when, and why, in a way that is easy to say yes to. The three letters here cover the usual cases. They leave every amount for you to fill in, because the right fee comes from your own costs and the value of the work, not from a template.
Updated · Editable Word document (.docx) · Free with a firm profile
Free with a firm profile
Get the editable fee increase lettersDownload the fee increase letters
The Word document (.docx), ready to fill in. Your profile unlocks every template on The Firm.
Or build it with AI
Open Claude or ChatGPT with the prompt filled in. It writes the finished document for your firm straight away, then asks a few questions to tailor it. No client data needed.
Works without client data. Don't paste client names, tax file numbers or ledgers into an AI tool your firm hasn't approved for them. AI data safety playbook.
How to use it
How to use this template
1
Read your engagement letter first
Find the clause on changing fees and the notice it requires. Your letter has to meet it, and the start date follows from it. The set and raise your fees playbook covers the whole process.
2
Work out each client’s new fee
From your own costs, the time the work takes and its value to the client. The free fee calculator works out the floor from your numbers. How to raise prices at an accounting firm covers the decision and the conversation.
3
Pick the letter that fits
Annual review for the routine rise, change of scope when the work has grown, minimum fee when a client is below what you can serve profitably.
4
Call your biggest clients first
Anyone who would be surprised by a letter should hear it from you. Send the letter the same day, so they have it in writing.
5
Reissue the engagement letter
If the scope or the fee basis changes, the client should sign an updated engagement letter, not just receive this one.
The template
The template in full
[Firm name] fee increase letter: [client]
Replace everything in [square brackets].
1. Before you send
The engagement letter’s notice period for fee changes is met: start date [date], letter sent by [date].
Each client’s new fee is set from your own numbers and recorded in [practice management software].
Tax is stated the same way as on the invoice: [plus GST / plus VAT / including tax].
Clients who will be surprised get a call first, from [name].
Recurring invoices, direct debits and payment plans are updated for the start date.
The team knows the letters are going, and who answers questions.
2. Letter A: annual fee review
Dear [first name],
Each [month] we review our fees for the year ahead. I am writing to let you know your new fees, which start on [date].
Service
Current fee
New fee from [date]
[Service, e.g. monthly bookkeeping]
[current fee and period]
[new fee and period]
[Service, e.g. annual accounts and tax return]
[current fee]
[new fee]
[One or two sentences on why, in your own words: what the work now involves, what you have invested in, or what it costs you to do it well.]
Nothing else changes: we will keep doing [the services] as set out in our engagement letter dated [date]. If you would like to talk through the new fees or what is included, reply to this email or call me on [phone].
Thank you for working with us.
[Name], [role]
3. Letter B: the work has grown (change of scope)
Dear [first name],
When we agreed your fee in [month and year], the work was [what it was, e.g. one entity with around a set number of transactions a month]. It has grown: [what changed, e.g. a second entity, employees, more transactions, a new location].
To keep doing the work properly, your fee will change to [new fee and period] from [date]. This covers [what is now included]. [Anything that is now quoted separately, e.g. advice outside the engagement.]
I will send an updated engagement letter for you to sign that sets this out. If you would rather we did less so the fee stays where it is, let me know and we can agree what to take out.
[Name], [role]
4. Letter C: minimum fee
Dear [first name],
From [date], we are introducing a minimum fee of [minimum fee and period] for [service]. Your current fee is [current fee], so it will change to [new fee] from that date.
[One sentence on why: for example, the time every client takes regardless of size, and the standard of work you want every client to get.]
If that does not suit you, I understand. Let me know by [date] and we will hand your records to the accountant you choose, as set out in our engagement letter, with everything they need to carry on.
[Name], [role]
5. What clients ask, and what to say
Question
An answer to adapt
Why now?
We review fees every [month]. [The reason in your letter, in one sentence.]
Can you hold it for this year?
[Your choice. If yes: "Yes, until [date]." If no: "No, but here is what we could take out to keep the fee where it is."]
What do I get for the extra?
[What is included, from the engagement letter. If nothing changes, say so: the fee pays for the same work done properly.]
Can I pay monthly?
[Your payment options.]
I want to leave.
"Thank you for telling me. We will make the handover easy." Then follow your disengagement process.
This template is a starting point, not legal advice. Your obligations depend on where you practise, your professional body and your clients; take advice on anything you are unsure of.
Common questions
Frequently asked questions
How much notice should I give clients of a fee increase?
At least what your engagement letter says. If it says nothing, give enough time for a client to plan, and for anyone who wants to leave to arrange a new accountant. Send the letter before the period the new fee covers starts, not with the first invoice.
Should a fee increase letter explain the reason?
Briefly, yes: one or two sentences in your own words about the work and what it costs you to do it well. A long justification reads as an apology and invites negotiation.
Should I say other firms are raising their fees too?
No. Explain your own reasons. What other firms charge is not a reason a client cares about, and fees are each firm’s own decision.
Do I need a new engagement letter when fees go up?
If the scope or the basis of the fee changes, yes: the client should sign an updated letter. A routine annual change may be covered by your existing letter’s fee review clause; check what it says.
What if a client says no?
Decide in advance whether you would rather keep the client at the old fee, do less for the same fee, or let them go. The minimum fee letter already offers a handover, so a no is not a crisis. If they do leave, the client disengagement letter template covers the handover.