How to Start a Bookkeeping Business (2024 Guide) – Forbes Advisor UK

Businesses of all types always need bookkeeping services. If you're considering becoming a bookkeeper, read our guide to learn how to start a bookkeeping business in 2024. We cover everything from the legal aspects of registering a new business to pricing, marketing, and more.

bookkeeping work

General bookkeeping responsibilities

Businesses often hire bookkeepers to help manage financial records and accounting reports. In particular, bookkeepers often:

• Document and categorize transactions, including income and expenses
• Manage your company's finances through business accounting software like QuickBooks and Xero
• Evaluate a company's cash flow
• Create financial statements such as balance sheets and income statements.

Difference between bookkeeping and accountant

Unlike CPAs, bookkeepers do not file tax returns or audit financial statements. Bookkeepers don't even need to have an accounting degree. Bookkeepers should not prepare or sign tax returns unless they are certified public accountants.

Certification for Bookkeeping Business

Some bookkeepers choose to obtain certifications for their businesses. Bookkeeping certifications can be earned through various financial platforms or training programs. You can also choose to become a certified bookkeeper to better market yourself as a bookkeeping professional.

Professional associations also offer certifications so you can hone your skills and market yourself as a professional bookkeeper. For example, the Society of Accounting Technologists offers a certification in bookkeeping.

Create a business plan

A solid business plan is necessary for a new business, including a bookkeeping business, to get off the ground. A business plan not only helps you clarify your business goals and objectives, but it can also be used when raising capital from lenders and investors. A business plan generally includes:

• Overview of your business
• Business summary
• Market/competitive analysis
• Description of main products and services offered
• Marketing and sales planning
• Proposed budget and financial forecasts.

If you have a bookkeeping business, you can also include information about your area of ​​expertise, your USP, and any certifications you hold.

Please select a business name

You want your business name to reflect who you are as a person and the type of service you provide. Your business name is the first thing that tells your customers, clients, competitors, and the rest of the market who you are and what you do.

Register your business

Once you have chosen your business name, you will need to register your business with HMRC (the UK tax office). If you start as a sole trader, like most start-ups, you are required by law to pay your taxes through self-assessment. This means you will need to file a tax return each year to notify HMRC of your income.

To do this, you must first register for self-assessment. As a sole trader, it is important to realize that you are personally responsible for your business debts.

Get the right software

There is no shortage of business accounting software available. Popular options include QuickBooks, Xero, FreshBooks, and Zoho Books.

Learn more about evaluating different business accounting software. Some clients may have preferences in the accounting software they want to use, so you need to be familiar with multiple software.

Service pricing

Determining how much to charge your clients can be difficult. You will need to do your research before pricing your services, and you will also need to maintain some flexibility to adjust future rates.

You can look at freelance sites like Upwork to see how much others charge for bookkeeping services, but you can also learn a lot by asking around.

Check with businesses in your area to find out how much they are currently paying for bookkeeping services. Talk to bookkeepers in your network and ask for their rates. Doing so will give you a good idea of ​​what the bookkeeper will charge for their services.

The specific amount you charge a client for your bookkeeping services will depend on your qualifications, years of experience, and familiarity with your client's business.

Research funding options

You'll probably need to open a business bank account and a business credit card. This will help you keep your business expenses organized and separate.

You may also seek a small business loan if you plan to hire employees, such as administrative assistants. A business plan is especially important when seeking funding from banks or investors, as it affects how potential lenders and investors will understand your business.

market your business

Before launching your bookkeeping business, you should consider creating a marketing and sales plan to set yourself up for success. A bookkeeping marketing and sales plan may include:

• Determine where your clients hear about you and find ways to meet them there (e.g. Google My Business, Google Ads, etc.)
• Establish an online presence with a search-optimized website.Learn how to create a small business website
• Add your bookkeeping business to relevant online business directories.
• Evaluate who in your network could become potential clients or customers
• Evaluate who in your network can be a potential source of business referrals
• Consider whether your budget allows for paid advertising and marketing materials.
• Consider local advertising opportunities.

conclusion

In addition to being familiar with finance and accounting software, running a successful bookkeeping business requires staying up to date with accounting software technology trends, marketing your business, managing your own business, and communicating with your customers. Good relationships must be maintained.