Hosted VoIP has become the default business phone system in the UK. With the traditional PSTN network shutting down in 2027, every business with a landline will need to switch to an internet-based alternative. This guide covers everything: how hosted VoIP works, what it costs, how to choose a provider, and how to migrate without disruption.
What Is Hosted VoIP?
Hosted VoIP (Voice over Internet Protocol) is a phone system that runs entirely over the internet. Instead of copper phone lines connecting to a physical exchange, your calls travel as data packets over your broadband connection to servers managed by your VoIP provider.
The “hosted” part means all the infrastructure — the call servers, routing, voicemail, auto-attendant — sits in your provider’s data centre, not on your premises. You don’t need a server room, a PBX box, or an IT team to manage it. Everything is configured through a web portal or app.
How It Differs from On-Premise VoIP
On-premise VoIP (using solutions like 3CX or Asterisk installed on your own server) gives you more control but requires in-house technical expertise. Hosted VoIP trades some customisation for simplicity — your provider handles all maintenance, updates and failover. For 95% of UK SMEs, hosted VoIP is the right choice.
How Much Does Hosted VoIP Cost in 2026?
| Cost Element | Typical Range | Notes |
|---|---|---|
| Per-user licence | £6-15/user/month | Includes calls, voicemail, softphone app |
| Desk phone hardware | £50-200 per handset | Or rent from £3/month. Softphone-only is free |
| Number porting | Free-£10 per number | Most providers include this free |
| Setup/installation | Free-£200 | Often waived on 12+ month contracts |
| International calls | 1-5p/min (EU), 5-20p/min (rest) | Much cheaper than traditional rates |
| Call recording add-on | £2-5/user/month | Some providers include this at no extra cost |
For a typical 10-person business: Expect to pay £80-150/month total, compared to £200-350/month for a traditional PBX system with ISDN lines. That’s a saving of 50-60%.
Top Hosted VoIP Providers in the UK (2026)
| Provider | Starting Price | Best For | Standout Feature |
|---|---|---|---|
| RingCentral | £8.99/user/mo | Teams of 10-100 | All-in-one UCaaS platform |
| 8×8 | £10/user/mo | International businesses | Unlimited calls to 48 countries |
| Vonage | £9/user/mo | CRM integration | Deep Salesforce/HubSpot integration |
| 3CX | Free (up to 10 users) | Tech-savvy SMEs | Self-hosted or cloud, maximum flexibility |
| HyperCloud (CT) | £6/user/mo | UK SMEs wanting white-glove setup | Free migration, UK-based support |
| GoTo Connect | £10/user/mo | Simple setup | Visual dial plan editor |
| Mitel | £12/user/mo | Enterprise/contact centres | Advanced call centre features |
| BT Cloud Voice | £13/user/mo | BT broadband customers | Bundle discount with BT broadband |
For a detailed head-to-head comparison, see our hosted VoIP providers compared article.
Key Features of Hosted VoIP
Auto-Attendant (Virtual Receptionist)
Automatically greets callers with a professional menu (“Press 1 for Sales, 2 for Support”) and routes them to the right person or department. Replaces the need for a dedicated receptionist for many small businesses.
Softphone Apps
Every hosted VoIP system includes desktop and mobile apps that turn any device into a business phone. Your team can make and receive calls on their business number from anywhere — the office, home, or on the move.
Call Recording
Record calls for training, compliance and dispute resolution. Essential for financial services, recruitment and healthcare businesses. See our business call recording guide for GDPR compliance details.
CRM Integration
Connect your phone system to Salesforce, HubSpot, Zoho or Microsoft Dynamics. When a customer calls, their record pops up automatically. Call logs and recordings are attached to the contact record without any manual data entry.
Call Analytics
Real-time dashboards showing call volumes, wait times, missed calls and agent performance. Essential for sales teams and customer service departments where response time directly impacts revenue.
Number Porting
Keep your existing business phone numbers when you switch. Porting is managed by your new provider and typically completes in 1-10 working days with zero downtime.
Setting Up Hosted VoIP: Step by Step
- Check your broadband: You need at least 1Mbps upload per concurrent call. Run a speed test at your office during peak hours.
- Choose your provider: Compare based on features, price and contract flexibility. Get quotes from at least 3 providers.
- Port your numbers: Give your new provider your existing phone numbers. They handle the transfer with your old provider.
- Configure your system: Set up extensions, auto-attendant menu, call groups and voicemail through the web portal.
- Install phones/apps: Plug in IP desk phones (they auto-configure) and download softphone apps to computers and mobiles.
- Test and go live: Make test calls, check call quality, and switch over. Most businesses are fully live within 24-48 hours.
Hosted VoIP vs SIP Trunking: Which Do You Need?
This is a common confusion. SIP trunking connects an existing on-premise PBX to the internet. Hosted VoIP replaces the PBX entirely. Choose SIP trunking if you’ve recently invested in a PBX and want to keep it. Choose hosted VoIP if you want a clean, fully cloud-managed solution.
The 2027 PSTN Switch-Off: Why You Need to Act Now
BT is switching off the traditional phone network (PSTN/ISDN) by January 2027. Every business still using a traditional landline will need to move to a VoIP-based alternative. If you haven’t switched yet, starting now gives you time to test, train staff, and iron out any issues before the deadline.
Read our full guide on preparing for the 2027 landline switch-off.
Common Concerns About Hosted VoIP
Call Quality
Modern hosted VoIP delivers HD call quality that’s audibly better than traditional phone lines — provided your broadband is adequate. Quality of Service (QoS) settings on your router prioritise voice traffic over other data, eliminating jitter and latency.
Reliability
Enterprise-grade hosted VoIP providers guarantee 99.99% uptime (less than 53 minutes downtime per year). If your internet drops, calls automatically redirect to mobile numbers or voicemail. 4G/5G failover routers add an extra safety net.
Security
All reputable providers encrypt calls using TLS and SRTP. Your calls are as secure as — if not more secure than — traditional phone lines, which are trivially easy to tap at the exchange.
Hosted VoIP for Specific Industries
Legal and Professional Services
Law firms and accountancy practices need call recording for compliance, detailed call logs for billing clients, and absolute reliability during client consultations. Hosted VoIP delivers all three at a fraction of the cost of a traditional PBX. Look for providers offering per-second billing for accurate client time tracking.
Healthcare and GP Practices
NHS-connected practices need N3/HSCN compliant connections and the ability to handle high call volumes during morning appointment slots. Hosted VoIP with call queuing and callback features reduces engaged tones and improves patient experience. See our healthcare telecoms guide.
Recruitment Agencies
High outbound call volumes, CRM integration and call analytics are essential. Hosted VoIP integrates with Bullhorn, Vincere and other recruitment CRMs to auto-log calls, and analytics dashboards track consultant performance in real time. See our recruitment telecoms guide.
Retail and Hospitality
Multi-site businesses benefit from centralised call routing — a single number for all branches, with calls automatically directed to the nearest or least-busy location. Hold music, out-of-hours messaging and IVR menus are included as standard.
Hosted VoIP and Microsoft Teams Integration
Many UK businesses use Microsoft Teams for internal communication but need external phone capabilities. There are three ways to add phone calls to Teams:
- Microsoft Teams Phone + Calling Plan: £7.20/user/month for the Teams Phone licence, plus £6/user/month for a Domestic Calling Plan. Total: ~£13.20/user/month. Simple but expensive and limited.
- Direct Routing: Connect a third-party VoIP provider to Teams via a Session Border Controller (SBC). Cheaper calling rates, more flexibility, but requires technical setup.
- Standalone VoIP alongside Teams: Use Teams for video/messaging and a separate hosted VoIP system for phone calls. The simplest approach and often the cheapest overall.
For most SMEs, option 3 (standalone VoIP) or option 2 (Direct Routing) offers the best value. Connection Technologies can set up either approach.
Migrating to Hosted VoIP Without Disruption
The Parallel Running Approach
The safest migration strategy is to run your new VoIP system alongside your existing phone system for 1-2 weeks. During this period:
- Your existing numbers continue working as normal
- New VoIP numbers are set up and tested internally
- Staff are trained on the new system
- Any issues are identified and resolved
- When everyone is comfortable, numbers are ported across in a single switchover
This approach means zero downtime, zero missed calls, and a confident team on go-live day.
What to Tell Your Customers
Nothing. If you port your existing numbers, your customers won’t notice any difference — except potentially better call quality. There’s no change of number, no downtime, and no action required from their side.
Troubleshooting Common VoIP Issues
Echo or Delay on Calls
Usually caused by excessive network latency. Enable QoS (Quality of Service) on your router to prioritise voice traffic. If the issue persists, check that your broadband upload speed is adequate — run a speed test during business hours.
Calls Dropping
Almost always a broadband issue, not a VoIP issue. Check for packet loss using a VoIP-specific speed test tool (many providers offer these free). If your broadband is unreliable, consider a dedicated business-grade connection or 4G failover.
Poor Sound Quality
Check that the G.722 (HD voice) codec is enabled on your phones/softphones. Ensure your headset is compatible and the microphone isn’t muted or on low volume. Use wired ethernet for desk phones rather than Wi-Fi for the most reliable quality.
Frequently Asked Questions
Is hosted VoIP suitable for a one-person business?
Absolutely. Even a sole trader benefits from a professional auto-attendant, voicemail-to-email, and the ability to take business calls on a personal mobile without sharing the number. Plans start from £6/month.
Can I use my existing desk phones?
If they’re SIP-compatible (most IP phones from Yealink, Polycom, Cisco are), yes. Your provider will supply configuration settings. Older analogue phones need an Analogue Telephone Adapter (ATA) — typically £20-40.
What broadband speed do I need for hosted VoIP?
Each concurrent call uses about 100Kbps. For a team of 10 all on calls simultaneously, you need at least 1Mbps upload. We recommend 5x that as a buffer. Any fibre broadband connection will handle this easily.
How long does it take to set up?
Most hosted VoIP systems are live within 24-48 hours. Number porting can take up to 10 working days, but your provider will set up temporary numbers so you’re not waiting.
Can I keep my business number?
Yes, 100%. Number porting is a regulated right in the UK. Your new provider handles the entire process with your old provider.
Get a Free Hosted VoIP Quote
Connection Technologies provides HyperCloud hosted VoIP from £6/user/month with free migration, free number porting, and UK-based support. We also compare quotes from RingCentral, 8×8, Vonage and 20+ other providers to ensure you get the best deal.
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