How Much Does a CPA Charge for Bookkeeping for a Small Business?

Depending on your bookkeeping needs, you can pay as little as $275 a month (when billed annually). In addition to bookkeeping and tax advice, plans come with accounting software like Xero and Quickbooks, mobile apps, and profit and loss statements. It might make sense for a large business with complex bookkeeping needs year-round to have an in-house bookkeeper.

• Instead, it’s more of a holistic view of time, resources, and the ability to become more efficient that will make or break your decision.
• Depending on the type of industry and your income goals, you can offer full-charge services, including payroll, managing fixed assets, and contributing to advisory conversations.
• Now, this is also where it gets kind of fun, because if you’re using good systems you can actually save a lot of money.
• Owning a business means that you wear many hats, which can be a daunting prospect.
• Employee costs like benefits, training, and time-off are important to think about when comparing an in-house bookkeeper and a financial management company.

While these exact figures can change over time, the cost comparisons of covering your bookkeeping and accounting needs can vary greatly depending on the type of individual you hire. On top of this, it is also a bookkeeper’s job to keep everything organized. That way, when it is time to file your small business taxes, you can easily access all the data you need. For many small business owners, bookkeeping is one of those necessary evils. It’s not something that most people enjoy, but it is essential in order to keep your business running smoothly. Do your due diligence to make sure you’re billing your clients fairly.

Nick Charveron is a licensed tax practitioner, Co-Founder & Partner of Community Tax, LLC. His Enrolled Agent designation is the highest tax credential offered by the U.S Department of Treasury, providing unrestricted practice rights before the IRS. ACCA’s chief economist Jonathan Ashworth scrutinises inflation predictions amid interest rate rises and growth concerns Read More… Bookkeepers can also ensure unpaid invoices are chased, which otherwise could be forgotten about – especially if a business has a high number of invoices going out every month.

In general, accountants usually need a bachelor’s degree in accounting and pass a CPA exam in their state. One of the biggest advantages of outsourcing your bookkeeping is the cost. On average, a bookkeeping firm will charge anywhere between $300 to $2,000 per month depending on the amount and complexity of work required. Depending on the amount of work involved, you can hire either a full-time bookkeeper or a part-time bookkeeper.

How Much Does a CPA Charge for Bookkeeping for a Small Business?

Many businesses hire a virtual bookkeeping assistant to remotely manage all their bookkeeping tasks. This allows for efficient record-keeping and timely financial reporting at all times. As great as it is to talk about potential bookkeeping costs and get estimates, we know that seeing an actual average for your state can yield excellent value for you as a business owner. Please see the chart below with data pulled directly from the US Bureau of Labor Statistics 2022 data to learn more about the average salary and hourly rate for bookkeeping.

A better option would be to use a service like QuickBooks Live virtual bookkeeping, where your bookkeeper costs would not be affected by where you live but rather how much your business expenses are per month. However, if your business has many transactions, you may need a more How much does bookkeeping cost full-service outsourced accounting solution that includes things like running payroll, collections, processing payments, etc. Your budget for bookkeeping should fall within the general $250-$2,000 per month, but there are outliers in that range due to the many variables.

Main Takeaways for Hiring a Bookkeeper

Owning a business means that you wear many hats, which can be a daunting prospect. In fact, 60% of small business owners aren’t confident in finance and accounting. These functions are essential parts of a business, and it’s vital business owners have this expertise to manage a company properly. Fortunately, there are solutions that companies can turn to, like using in-house bookkeeping or outsourcing their bookkeeping functions.

The higher priced bookkeeping packages provide time for the founder to connect with the accounting team. Kruze offers fixed, monthly bookkeeping price packages that range from ~$600 per month to several thousand dollars per month, depending on the complexity of your books and the number of transactions. We believe that startups deserve to know what their monthly bookkeeping costs will be, which is why we offer set, recurring packages. The highest end of these packages are suitable for divisions of public companies, startups with multiple locations with complex compliance needs and more. To sum it up, bookkeeping services can be pricey for small businesses, whether you’re dealing with traditional firms or virtual providers.

Creating financial statements

Our premium package offers access to strategic expertise from professionals that understand your startup’s needs. Our entry-level package gives early-stage founders the accounting expertise they need. The American Institute of Professional Bookkeepers (AIPB) certification program is ideal for someone who doesn’t have any formal education in bookkeeping. Certification exam and materials are $610 for nonmembers and $515 for AIPB members. Upon completion of all certification requirements, you’ll earn the designation of Certified Bookkeeper (CB), which you can include on your business cards and marketing materials.

Bookkeepers are mostly concerned with everyday activities like recording transactions, whereas accountants provide thorough financial assistance and tax counselling. For most business owners, full-service and outsourced bookkeeping are excellent, but the bottom line is the cash flow. The outsourced bookkeeping firm will be able to assist you in scaling your expanding business by adding full-service accounting when you’re ready for it. Additionally, outsourcing has several advantages that an internal bookkeeper does not.

Hourly Bookkeeping Rates Frequently Asked Questions

Hiring both an accountant and a bookkeeper can ensure that the books are in order, but without spending huge costs on tasks that could be done more cheaply. “Clients have different business models, so some will be raising heaps of invoices – like online businesses – everyday. Others might raise a couple of invoices a week but they might have more expense transactions going through, so it does vary from client to client,” says Whitman. Get in touch with us today to learn more about our monthly bookkeeping options. Additionally, there are quite a few outside expenses that come with hiring an employee.

Get up and running with free payroll setup, and enjoy free expert support. Whatever structure and pricing you go with, make sure to lay it all out on the table for current and prospective clients. That way, there are no surprise fees, and clients know what to expect from you. You may also consider throwing in other costs, like a fee for an initial consult, to your pricing structure.

Bookkeeping Services Pricing – How are they calculated?

They may work for an organization’s accounting staff and normally have no supervisory duties. A bookkeeper given the title of «full charge» is given complete control over the accounting duties of the company. Although employing one gives you greater management and control over your bookkeeping, in-house bookkeeping is sometimes more expensive than outsourced bookkeeping.

Other factors that can impact the hourly rate include the freelance bookkeeper’s level of education, certifications obtained, such as QuickBooks ProAdvisor, and the software used. A specialty in additional services like payroll or financial analysis, the frequency of services offered, and even an expertise in certain accounting applications can also affect the rate. Full-charge bookkeeping is a type of bookkeeping service where the bookkeeper is responsible for overseeing all of a business’s bookkeeping requirements. From accounts payable and receivable to payroll, bank reconciliations, financial statements, and more.

Although several factors will go into determining how much you spend on bookkeeping, there are some standard industry rates that you should be aware of. In the U.S. currently, small businesses are generally charged an hourly rate of $150 to $450 per hour for their bookkeeping needs when they hire a Certified Public Accountant. If you don’t need all the services of a CPA, you could hire a bookkeeper instead, which would cost around $30 to $90 per hour. Income for online bookkeepers and freelance bookkeepers may vary depending on several factors, such as experience, skills, location, client base, and the types of services that they offer. However, freelance bookkeepers may have more control over their pricing and may charge higher rates because of their specialized skills or expertise.

It’s important to note that the software you use may affect your rate, as some solutions are more expensive than others. Another important factor is your expertise in various accounting software. In general, good cloud-based software makes accounting easier and reduces the hours, allowing you to charge more per hour. Small clients often have simple bookkeeping needs and small revenue, so you may want to charge them less. For instance, you may charge an hourly rate of $40 to a large client that earns up to $2 million in revenue and around $30 for a very small client with an annual revenue of $300,000. Eight key factors will impact the hourly rate you’ll charge for your services.

Starting with an hourly rate with a new client is beneficial because usually it will take more time to get their books set up, as they could have been quite a mess before you took them on. You may be helping them play catch-up to get organized not only in the current year, but also in previous years. Our bookkeepers will give you a clear overview of your business’s financial situation. They will generate precise financial statements, such as income statements, balance sheets, and cash flow statements, giving you all the necessary information.