For small to medium-sized businesses, the costs of VoIP and PBX phone systems typically fall into a few clear categories: upfront setup, ongoing service, and optional extras. On-premise PBX systems usually involve higher initial expenditure for hardware, handsets, licences and installation, often ranging from a few hundred pounds for very small offices to several thousand for multi-site deployments. VoIP and hosted PBX solutions, by contrast, tend to reduce capital outlay, replacing large one-off purchases with predictable monthly per-user fees. These can start from around £10–£25 per user per month, depending on features, call bundles and contract length. In both cases, you should also factor in broadband quality, internal cabling, and any need for professional configuration or training.
Beyond the headline figures, the true cost of a phone system is shaped by call volumes, the number of users, required features and the level of support you expect. Advanced options such as call recording, CRM integration, call centre functionality and mobile apps may add to monthly fees but can deliver significant operational benefits. Maintenance and support contracts for on-premise PBX equipment, or managed service fees for hosted VoIP, are another important consideration. When assessed over three to five years, many SMEs find that VoIP and cloud-based PBX systems offer lower total cost of ownership, greater scalability and reduced risk, provided the underlying connectivity is robust and the solution is correctly specified from the outset.
Typical costs for a PBX telephone system start with the core platform and handsets. For an on-premise PBX, hardware, licences and professional installation can range from hundreds to several thousand pounds, depending on the size of the business and complexity of the configuration. IP handsets usually cost £50–£200 each, with more advanced models attracting higher prices.
Hosted VoIP and cloud PBX solutions usually replace large upfront costs with monthly subscriptions. Expect to pay a per-user fee, often between £10 and £25 per month, which may include UK landline and mobile call bundles, voicemail, auto-attendant and basic reporting. Additional features such as call recording, contact centre tools or advanced analytics may be charged as add-ons.
Alongside system and licence fees, budget for connectivity and support. Business-grade broadband or dedicated connectivity, structured cabling, ongoing maintenance and local engineering support all contribute to the overall cost and reliability of the service.
