A Guide to Starting a Virtual Online Bookkeeping Business in 2023
Before you start to get clients, it’s a good idea to have a professional and slick website, plus a branded email address. If you’re just starting out and limited on funds, you might consider a sole proprietorship. However, PROCEED WITH CAUTION and consult with an attorney before you begin your business. Preparing a business plan is essential for everyone should do before they start a business. In the early days of accounting, we relied on the abacus then PC’s and floppy disks to show our work to clients.
As a result, take the time to examine both your client’s and the project’s nature. The importance of the job to the client influences the rate you may charge more than anything else. Spend some time getting to know a new customer when you first start working with them so you can better understand their requirements and aspirations.
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. This is crucial for taxes as well as personal liability protection. And since your potential customers are no longer limited to your local area, you can focus on marketing to the types of business owners you most want to serve. For an accountant or bookkeeper, running a virtual practice has some major advantages. First, you have the flexibility to work on your client’s books any time of day or night.
Best Small Business Accounting Software in 2023
You can learn to do these things, but don’t actually do them before you know how to. Accounting & related professions, including bookkeeping, seem to come naturally to some people. My observations of my college classmates back up my theory, and I think you’ll just know if you’re cut out for bookkeeping or accounting.
Please, please don’t start a virtual bookkeeping business with no knowledge, training, or qualifications. When I started my virtual bookkeeping business, I completed the testing to become a Certified Public Bookkeeper. My Master’s of Professional Accountancy degree provided me with more than enough knowledge to pass the exams, but the certification lends credibility to a new entrepreneur. Quickbooks is one of the most popular small business accounting software options. Intuit, the parent company, provides numerous training options. I am a wholesaler for Quickbooks, so my clients get a discount on their monthly subscription, but I also have access to training.
Should You Start a Bookkeeping Business?
Some clients will do work at their site, like entering bills, writing checks, sending invoices, and more. In this case, you’ll be responsible for ensuring they make proper entries, reconcile accounts and bank statements, get financial documents, and more. I live in Florida and I have 8 years of accounting experience including bookkeeping.
- When launching a virtual bookkeeping business, you can either self-fund or take out a bank loan.
- A virtual bookkeeping business run out of a home has relatively few startup needs.
- Types of insurance many bookkeepers secure include professional liability and general liability.
- Some bookkeepers may decide to earn optional credentials, such as the certified public bookkeeper designation.
- My goal was to create a private community for bookkeepers to support each other and be free to create a QBO Bookkeeping Business that fits your personality and goals.
SquareSpace is a very easy way for beginners to create basic websites. WordPress is the most common recommendation for new bloggers, but that platform is more complicated to learn. You can either encourage your clients to move to your preferred software or become acquainted with the software they’re already using. Alternatively, you could only take on new clients who use your preferred software. One day, you’ll probably want to upgrade and buy a printer/scanner unit. If you have the start-up funds, get the nicer option in the beginning.
Bookkeeping service software
Yet it’s not just about how good you are at your job and how professional you are. Depending on your training, certification, and experience you’ll learn to navigate different strategies and dial in what will help your company succeed. Only you know what accounting style works best for you, choose a system that helps you thrive. This will give you the spending power to set up your company and put all of your business expenses in one place.
If you set up a corporation in a state that collects state income taxes, you might need to obtain an identification number for state income tax withholdings. I’ve found that calling & talking to a human gets clearer results than searching the state’s website. That means there are more tax factors involved, so I absolutely recommend discussing with a CPA. I even consulted a CPA on when to incorporate vs staying as an LLC. In my case, she recommended incorporating when my business reached a higher income-generating point… so you definitely don’t need to start as a corporation. You need to purchase a reliable bookkeeping business software solution to stay on top of your client’s bookkeeping and manage workflow.
Build a website to attract financial leverage for your bookkeeping services. You can start earning early as a virtual bookkeeper and create multiple sources of income by partnering with various companies, individuals, and freelancers. Many bookkeepers prefer to form limited liability companies to limit personal liabilities and enjoy the benefits of flexible management structures and taxation options. If you’re going to start working as a full-time bookkeeper single-handedly, you can choose to form a sole proprietorship. However, you’ll be liable for all business debts and lawsuits as a sole proprietor.
The market is filled with companies and banks that offer outstanding business banking account deals. You should take some time to review the available offers and select the bank that you think will provide you with all of the necessary services. If you’re unsure which structure suits your business needs best, getting professional advice from an attorney can help you to make the right decision. A sole proprietorship is a popular choice for online bookkeepers because it’s perfect for people who are just starting out and have limited funds. Also, some Certified Public Accountants don’t provide bookkeeping services.
There are a few different levels you can go through, depending on how many clients you have, so there’s something there for everyone to learn. So, theoretically, whoever you are and whatever experience you have or do not have, you could start your bookkeeping business right now and start working from home. But there’s more to bookkeeping than this – most business owners don’t just want to know the numbers, they want to understand them, too. If you’ve got a knack for numbers and a good head for organization, starting a bookkeeping business might just be the right choice for you.
Form Your Business
Knowing the market and what makes you stand out from other competitors will naturally draw your potential client base to your bookkeeping services. A successful business needs a strong marketing strategy from the start. Perhaps you’ve worked as a bookkeeper for a larger company or firm and you’d like to branch out and start your own business. You may be ready to be your own boss, work virtually, make your own hours, and build your own accounting software program. Just make sure you have a plan to pay off the balance before the introductory offer ends and a variable APR sets in. As you grow your client roster, you’ll want to make sure you’re tracking them effectively and completely.
- To get you started, Bookkeeping Launch can teach you the basic bookkeeping skills and you can later enroll in their full course and learn how to grow and scale your business.
- Now that you have learned how to start an online bookkeeping business, you should take the first steps towards becoming a renowned bookkeeper and getting clients.
- You can choose from a bunch of certification courses or classes to learn new skills and take your business to the next level.
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Professional associations also offer certifications so that you can hone your skills and market yourself as a professional bookkeeper. For instance, both the American Institute of Professional Bookkeepers and the National Association of Certified Public Bookkeepers offer certification programs. It’s been used by more than 14,000 other women and men to start a bookkeeping business. While some businesses may do well with basic and free software like Wave, others require an accounting solution with more developed features, like… It’s tough to stay on top of new trends and changes in the industry.
Providing virtual bookkeeping services for a particular type of business will certainly make your job easier. This is because they are likely to have the same types of expenses and financial recording requirements. Now that you have learned how to start an online bookkeeping business, you should take the first steps towards becoming a renowned bookkeeper and getting clients. Tell your friends and family about your business and gather contacts of business owners who could be potential clients.
That’s in the case that you already own a desktop computer or a laptop. If not, your costs will be higher because you need a reliable device to offer virtual bookkeeping services. Virtual bookkeeping firms also need several non-accounting software subscriptions. You should have PDF editing, presentation, and time management or workflow software. Microsoft Office Suite used to be a requirement, but many virtual bookkeeping businesses use the free Google Workspace products. When people talk about virtual bookkeeping, they are usually referring to online bookkeeping services.