How to Find the Best Virtual Bookkeeping Service for Your Business

Like Xero and QuickBooks, Sage Business Accounting’s reports are user friendly and very easy to read. Its business trend reports are particularly useful—they compare your business’s current health with its past growth and future goals so you can keep your business on track for success. If you’re several years behind on your bookkeeping and taxes, you can get caught up and filed with Bench Retro. You won’t need any other software to work with Bench—we do everything within our easy-to-use platform. The most common mistakes are mixing personal and business finances, leaving taxes to the last minute, missing out on deductions, and not retaining records for long enough. We consider the opinions of users and the service’s ratings on various review sites.

A trustworthy software will help you stay on top of your clients’ bookkeeping and better manage the workflow. Having the right tools and support in place makes a big difference, and your clients will love you for it. In the steps below, we’ll dive into what each point means and why it’s essential for your bookkeeping business success. Alright, we know you may be a little tired — but we promise you can get started on your virtual bookkeeping practice in eight steps. But besides the boring technical stuff, you also offer a core set of working benefits that can make an immediate impact on a company’s financial health. Bookkeepers are experts at managing the day-to-day finances of a business.

• When people talk about virtual bookkeeping, they are usually referring to online bookkeeping services.
• The most common mistakes are mixing personal and business finances, leaving taxes to the last minute, missing out on deductions, and not retaining records for long enough.
• You can open a business bank account at a traditional bank, credit union, or online bank.
• Being a Merritt Bookkeeping customer also eliminates the need to pay a subscription fee for accounting software, as Merritt will handle everything for you.

Some additional services you may have access to include inventory tracking, BillPay, CFO services, and tax services. The best online bookkeeping services are affordable and easy to use, offer a wide range of bookkeeping solutions, and provide easy access to dedicated bookkeepers. Many of the top virtual bookkeeping services also have add-on services, such as catch-up bookkeeping, payroll, and tax filing, which can streamline your work.

National Association of Certified Public Bookkeepers (NACPB)

Xendoo offers three subscription plans, which are based on the monthly expenses of your business and the number of bank and credit card accounts that are connected. Custom plans are also available for businesses with more than $125,000 in monthly expenses. Freelancers and startups often working remotely will appreciate the iOS mobile app that provides financial reporting functionality and real-time cash flow updates. Upon enrollment, you’ll have access to a team of in-house bookkeepers, and you can book a monthly check-in or tax season review call with them at no additional charge. Today, virtual bookkeepers are more strategic about using cloud-based accounting software to let stakeholders (the small business owners) see data on mobile and from any location.

Thankfully, online bookkeeping services have lowered the financial barrier to getting bookkeeping and tax-related help. The right software helps business owners quickly categorize transactions and generate financial statements. These include cash flow reports, balance sheets, profit and loss statements, and expense breakdowns. You should outsource your bookkeeping tasks to a virtual bookkeeper if you don’t have the above-the-line costs definition time for and knowledge of DIY bookkeeping. As your business grows and your financial transactions increase, you will need a virtual bookkeeper to do routine tasks, like classifying transactions and reconciling bank accounts. The best online bookkeeping service should offer a wide range of bookkeeping solutions, including catch-up bookkeeping, invoicing, bill pay, bank reconciliation, payroll, and tax filing.

• As a small business owner, she is passionate about supporting other entrepreneurs, and sharing information that will help them thrive.
• They must offer flat rate pricing — a monthly fee in exchange for a well-defined set of deliverables.
• At the same time, the number of predicted bookkeeping job openings per year over that period is 197,600.
• Typically, online bookkeepers are not hired in-house and so do not receive benefits.
• Answer a few questions about your accounting software needs and we’ll send you up to five customized recommendations.
• Accounting software makes it possible to do much of this on your own, though you may decide to outsource some basic bookkeeping tasks to an online bookkeeping service as your small business grows.

The Bureau of Labor Statistics (BLS) projects that jobs for bookkeepers, accountants, and auditing clerks will decline by 5% from 2021 to 2031. However, the profession will still add 197,600 openings annually to fill roles held by retirees or job changers. Traditional, paper-based bookkeeping (referred to as manual bookkeeping) is still in use, particularly for smaller businesses.

Sign up for freelancer websites as bookkeeper

And it is, but you may still be asking yourself, “Well, what’s it like to run a virtual bookkeeping business? Even if you aren’t planning on growing any time soon, you need to have a sense of how much money is coming in vs. what is going out. On top of that, you need the data used in bookkeeping to file your taxes accurately. Bookkeeping focuses on recording and organizing financial data, including tasks such as invoicing, billing, payroll and reconciling transactions. Accounting is the interpretation and presentation of that financial data, including aspects such as tax returns, auditing and analyzing performance. Even if you aren’t planning on growing any time soon, you need to have a sense of how much money is coming in versus what is going out.

If you find that you have a talent for and enjoy the process, you may consider starting your own bookkeeping business providing this service to others. There’s always a demand for experienced, efficient bookkeepers in nearly every industry. Companies often outsource the organization of their finances to independent professionals, then hire accountants for more complex issues and tax filing. Even though we generally prefer Xero to QuickBooks, QuickBooks Online remains the most popular accounting software for US-based accountants, bookkeepers, and auditing clerks. For instance, most virtual and outsourced bookkeeping services still use QuickBooks or proprietary in-house software—though some, like Bookkeeper360, also sync with Xero. Xero is our top accounting software pick for small-business owners—its ease of use, low starting price, and thorough features set it apart.

What are common bookkeeping mistakes?

Think of bookkeeping as the diligent note-taker and accounting as the analyst who interprets those notes to provide insights and guide business strategy. While often used interchangeably, bookkeeping and accounting are distinct processes. NACPB’s resources benefit all who are interested in learning the fundamentals of bookkeeping and accounting.

Which Online Bookkeeping Service is Right for You?

The software’s bookkeeping features include double-entry bookkeeping (the most accurate bookkeeping and accounting method), plus dozens of customizable reports. In more traditional bookkeeping services, it was more of a process to get reports out. Someone had to be there to run the report, save it in the right format and send it out.

Accounts receivable bookkeepers collect money owed to the business and report delinquent accounts. Bookkeeping jobs focus heavily on recording financial transactions and maintaining records of those transactions. These transactions typically include sales revenue, business expenses and purchases, invoices, accounts payable, and accounts receivable. Someone who’s new to the profession, for example, may start their rates at $20 an hour, while someone with several years of experience may charge $35 an hour or more. Researching average bookkeeper salaries for your area can give you an idea of what your competitors may charge. It’s possible to start a bookkeeping business from scratch, even if you don’t have a professional or educational background in accounting or bookkeeping.

Organized and stress-free small business accounting

In this age of cloud accounting and virtual bookkeeping services, they should be able to have reports sent to you on a schedule. At my company, one of the specific things we teach accountants and bookkeepers who want to run a virtual bookkeeping service is that they should specialize in a few industries. This is true of any bookkeeper — in person or virtual — that you would hire. It’s especially true of virtual bookkeepers, however, because this will determine if the apps they use to do business are relevant to and compatible with your business.

Another type of accounting method is the accrual-based accounting method. This method records both invoices and bills even if they haven’t been paid yet. This is a highly recommended method because it tells the company’s financial status based on known incoming and outgoing funds. Because the funds are accounted for in the bookkeeping, you use the data to determine growth. The specific amount you charge your clients for bookkeeping services will depend on your certifications, years of experience and familiarity with the client’s business.