How to Start a Bookkeeping Business in 8 Steps

how to start your own bookkeeping business

You should plan on paying for help with online advertising, web design, search engine optimization (SEO), and website content management. Some CRM systems even offer a customer portal to make it easier for you and your clients to communicate. The best systems even integrate with popular accounting and bookkeeping software so data is always within easy reach. Additionally, an experienced bookkeeper can help business owners gain a better understanding of their company’s financial processes. Business owners can use this data to optimize financial performance and keep a close eye on their cash flow. You’ll also want to make sure that you set up a business bank account to keep your business finances separate from your personal finances.

  • You’ll also need to give some thought to how you plan to invoice your clients for your services.
  • The process involves sending estimates and invoices and keeping track of due dates.
  • If you can actually use your business plan as a roadmap to get started, then create one.
  • However, you’ll need to have at least five clients already to join it.
  • Unless they are a chartered certified accounant, bookkeepers should not prepare or sign tax returns.

Starting a bookkeeping business is one thing, but, building a client base is an entirely different challenge. I strongly believe that your bookkeeping services should be built into a subscription model on a monthly fixed-fee basis. After establishing the purpose of your accounting business, you’ll need to establish early on what your ideal client profile looks like. Starting your bookkeeping business costs a lot less than you might expect. Our comprehensive bookkeeping business course, Bookkeeper Launch, is designed to be completed in ten (10) weeks.

Best Small Business Accounting Software in 2024

When the financial year ends, and it’s time to submit taxes, all businesses need accurate records of their income and outgoings. For the most part, a simple online presence is relatively easy to start with minimal start-up costs. And while an online presence won’t guarantee an increase in exposure, not having one can have a negative impact and can discredit you to a potential client.

Get $30 off a tax consultation with a licensed CPA or EA, and we’ll be sure to provide you with a robust, bespoke answer to whatever tax problems you may have. You can connect with a licensed CPA or EA who can file your business tax returns. But where do you begin, and what do you need to launch as a new business owner? This article will walk you through the journey, from crafting a unique concept to navigating the legalities and finally welcoming your first customer.

What you need to set up small business bookkeeping

Developing a bookkeeping routine prevents you from accidentally forgetting important steps in the accounting process. Try setting aside and scheduling a ‘bookkeeping day’ once a month to stay on top of your financials. Use that day to enter any missing transactions, reconcile bank statements, review your financial statements from the last month and make any major changes to your accounting or bookkeeping.

Some accounting solutions offer a bookkeeper or accountant edition specifically designed for bookkeeping companies to use both for their books and as a portal to their client’s books. Many banks offer additional services that can help you maintain and scale your business operations, such as business credit cards, small business loans, and more. But obtaining professional certification, such as becoming a certified public bookkeeper, can demonstrate that you have the professional skills to help other companies with their business finances. You can also become certified in using accounting software, such as QuickBooks Online. Keep in mind that bookkeeping responsibilities are a bit different from those of a certified public accountant (CPA). Certified public accountants can file taxes, perform audits, and even provide professional guidance on the best way to manage company finances.

The Ultimate Guide To Starting A Bookkeeping Business

As we mentioned above, you don’t technically need to be certified to run a bookkeeping business. Determine your pricing structure based on factors like the complexity of the work, industry standards and the value you provide. Decide whether you will charge an hourly rate or offer fixed pricing packages. Establish clear payment terms and policies to ensure timely payments from clients and you’ll be well on your way. A user-friendly option for small business accounting, FreshBooks makes it easy to track income and expenses and includes a self-employed version just for you. Having a business bank account makes it much easier to file business taxes, it keeps business income separate from your personal funds, and it provides you with a way to pay your vendors.

how to start your own bookkeeping business

The only way to make that transition a reality is by time management. Sign up to receive more well-researched small business articles and topics in your inbox, personalized for you. Danielle Bauter is a writer for the Accounting division of Fit Small Business. She has owned Check Yourself, a bookkeeping and payroll service that specializes in small business, for over twenty years. She holds a Bachelor’s degree from UCLA and has served on the Board of the National Association of Women Business Owners. She also regularly writes about business for various consumer publications.

Tax & Accounting

As with most services, the amount you can charge for your bookkeeping business depends on your level of skill and experience. QuickBooks is better for invoicing and project management, and offers some features Xero doesn’t, like tax support and lending. On the other hand, Xero lets you add more users to one account for less – an important consideration if you want to have a larger business with employees. is a website full of online resources tailored to those who want to launch an online bookkeeping business. Whether you’re completely new to the world of bookkeeping or you’re a professional who wants to take things to the next level, there will be something suitable for you on the site. These days most businesses work with some form of accounting software, so being familiar with these programs is a must.

If you need to borrow money from someone other than friends and family, you’ll need to have your books together. Doing so lets you produce financial statements, which are often a prerequisite for getting a business loan, a line of credit from a bank, or seed investment. There are many reasons why you might want to start a bookkeeping business. Perhaps you’ve worked as an in-house bookkeeper for a business and you’re ready to take the plunge and set up for yourself. To learn more about the ins and outs of setting up your own business, check out our small business guide on how to start a business and our guide on starting a bookkeeping business.

There’s little doubt that the world of online bookkeeping jobs offers an exciting and profitable opportunity. For many people, the idea of working on your own terms to your own schedule while helping clients and earning a great income sounds like a dream come true. Having the ability to run a successful bookkeeping business depends on your skillset and experience in the field.

A nice one-two punch to help automate accounting and bookkeeping services is to use cloud software coupled with an expense management app. Also, some Certified Public Accountants (CPAs) don’t provide bookkeeping services. So, see if you know anyone who is a Certified Public Accountant and contact them. You may need to access your client’s apps and bank accounts to get work done. Starting a bookkeeping business from scratch can be difficult, but when done correctly, it can lead to a very rewarding career.

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