Guide · Running your technology
What does an IT department cost a small business in the UK?
What one IT hire really costs, what a full department costs, and the cheaper ways to get the same cover. Real UK numbers, with sources.
Most small businesses never set out to have an IT department. They get one by accident.
Somebody in the office is "good with computers", the business grows, and five years later the office manager is running the servers, the backups, the Microsoft 365 licences and the supplier who built the website, on top of their actual job.
At some point the question comes up: should we hire someone? Here's what that really costs, and what the alternatives cost, using real UK numbers. All the figures were checked in October 2026, and salaries move, so follow the links for the latest.
What one IT hire really costs
In Kent, a support engineer who looks after laptops and accounts is advertised at a median of about £32,500 (ITJobsWatch). Someone who can also run servers or write code costs more: full-stack developer jobs in Kent advertise at a median of £45,000 (ITJobsWatch), and the UK median for a systems administrator is also £45,000 (ITJobsWatch). So call it £45,000 for a decent all-rounder outside London, and more inside it.
The salary is only the start.
| Cost | Roughly, a year |
|---|---|
| Salary | £45,000 |
| Employer's National Insurance (15% above £5,000, GOV.UK) | About £6,000 |
| Employer pension (3% minimum on qualifying earnings, The Pensions Regulator) | About £1,200 |
| Laptop, software, training | £1,000 to £2,500 |
| Recruitment (agency fees are usually 15% to 20% of first-year salary, recruitly, spread over three or four years) | £1,700 to £3,000 |
| Total | About £55,000 to £58,000 |
That's about £4,600 a month. And you get one person, with one set of skills, who goes on holiday for several weeks a year and is off sick for a few days more.
The skills problem
This is the bit that catches people out. A small business doesn't need one IT skill. It needs about six:
- someone to look after laptops and accounts
- someone who understands servers and cloud hosting
- someone who knows security well enough to get you through Cyber Essentials
- someone who can build or join up software
- someone who can manage suppliers
- someone who can sit in a board meeting and say what's worth spending money on
You won't find all of that in one person at that salary. You'll find someone good at two of them and gamely muddling through the rest. That's not a criticism of IT people. It's just too much for one job.
What a proper in-house department costs
To cover those skills properly in-house you'd want four people: a support technician, a sysadmin, a developer and someone senior to plan and manage it. Using UK median advertised salaries from ITJobsWatch, that's roughly:
- support engineer: £36,000 (source)
- systems administrator: £45,000 (source)
- developer: £60,000 (source)
- head of IT: £72,500 (source)
That's about £210,000 in salaries, or roughly £250,000 a year once you add the same on-costs as above. It makes sense for a firm of a few hundred people. For a business of 20 it's out of the question, which is why most of them don't have one.
The cheaper ways to get the same cover
An IT support company
Usually charged per user per month, from about £30 a user for basic help desk and patching up to £150 for a fully managed service with some advisory work (Compare the Cloud's UK pricing guide has a good breakdown of what each level buys). For a 20-person firm that's roughly £7,000 to £36,000 a year. Good value for what it covers: laptops, printers, email, password resets and keeping Windows up to date.
What it usually doesn't cover: building or changing software, looking after the custom systems your business runs on, or the strategic stuff. When you need any of that, they'll refer you elsewhere.
A software house or freelance developer
Charged per project or by the day. The median advertised day rate for a UK software developer contract is about £525, with the middle half between about £430 and £575 (ITJobsWatch). You get what you asked for, built properly, with changes and upkeep priced separately afterwards. That suits a one-off build with a clear brief, and Dev Partners still works this way for plenty of clients. It suits a business that needs things built and changed all year round less well.
A fractional CTO
A senior person a few days a month. Published UK day rates run from about £800 to £1,100 outside London and £1,200 to £1,600 in it (fractional.quest, which notes these are asking prices). Excellent for decisions and strategy. Most don't do the work themselves, so you still need someone to do it. We compare the options in more detail in fractional CTO, IT support or an in-house hire.
An outsourced tech department
This is what we sell, so take this bit with the appropriate pinch of salt. A team that plans, builds, runs and secures your systems for one monthly fee, with custom software builds included. You get the six skills, holiday cover and a month's notice instead of an employment contract. What you don't get is someone sitting in your office every day.
We don't publish a price, because it depends on how many people you have, how many systems we're looking after and how much is being built at once. We work it out after a first conversation. As a yardstick, it comes in well under the cost of one in-house hire. Our guide to what an outsourced IT department should cover explains what to look for in one, whoever you choose.
So what should you do?
- Under 10 people: you almost certainly don't need a hire. You need decent cloud accounts, two-factor login on everything, tested backups, and someone to ring.
- 10 to 50 people: a local IT support company for desk support, plus someone who owns the systems, security and software side. That's the gap that usually hurts, because nobody's responsible for it.
- 50 to 100 people: an in-house IT person can make sense here, for the day to day. Pair them with outside help for the specialist work (security, development, servers) so they're not expected to be six people at once.
Whichever way you go, write down who's responsible for what. Most of the messes we get called in to fix happened in the gap between two suppliers who each thought the other one had it.
Common questions about IT costs
Around £55,000 to £58,000 a year all in, for a salary of about £45,000. Employer National Insurance, pension, kit, training and recruitment add roughly a fifth on top of the salary.
A department of four (support technician, sysadmin, developer and a head of IT) costs about £210,000 a year in salaries at UK median rates, or roughly £250,000 once National Insurance, pension, kit and recruitment are added.
For businesses under about 50 people, almost always. Outsourcing gets you several skill sets and holiday cover for less than one salary. Above that size, a mix of an in-house person and outside specialists often works best.
IT support companies look after the desk: laptops, printers, email and accounts. An outsourced IT department also plans your systems, looks after servers and cloud, handles security and certification, and builds or maintains software.
It depends on the size of the business, how many systems we look after and how much is being built at once, so we work it out after a first conversation rather than publish a number. It is one monthly fee with a month's notice, and it costs less than one in-house hire.
Work out what you actually need
Tell us how big you are and what you have, and we'll tell you what we'd do.
If one hire, an IT support company or a freelancer is the better answer for you, we'll say so.
What we will cover:
- What you're paying for now
- Where the gaps are
- What the options would cost you
- Whether you need us at all
Rather talk now? Book a call or ring 01474 639 089.
We reply within one working day.
