Best Online Bookkeeping Service – How to Pick

best online bookkeeping service

Published: 03/30/22

A business-of-one gives you a lot of freedom, creativity, and other benefits allowing you to run your business as you want. However, there are a lot of serious responsibilities that you need to take care of, such as file taxing. It might get intimidating for a small business owner to manage all the business services and finances. But you don’t need to be intimated. If you hire the best online bookkeeping service, it can take care of all the management parts of the business, allowing you to enjoy those parts of the business that you love. 

Firstly, you need to choose what kind of service you want. Bookkeeping services are of several multitudes, that include online bookkeeping, virtual assistants, software, CPAs, and back-office services that can be outsourced. They offer different services, tasks they can do, and the prices they charge vary accordingly. 

We will help you understand the different kinds of bookkeeping services available for a business of one, their jobs, charges, and make a decision about which one suits you best. 

What Are Online Bookkeeping Services?

Any kind of service provider, business, or program that can handle the finances and logistics for your business comes under online bookkeeping services. Some virtual bookkeeping services also offer services of taxes and legal stuff, depending on the demands of your business-of-one.

Online bookkeeping includes everything ranging from virtual assistants to software like Xero. Bookkeeping services vary according to the demands of your business. As a small business owner, you might be able to handle everything yourself at first, but as the business grows, the management also gets more complex; you may need to hire more employees, more income to track, and more tax obligations.

If the needs of the business surpass your accounting skills, or you realize that you are not doing what you initially wanted to, and would rather spend time doing what you love, it is time that you think about outsourcing your management.

It is time to look at options to hire a bookkeeping service.

Types of Bookkeeping Services

There are three main types of bookkeeping services for small businesses. These are:

  • Virtual Bookkeeping Services

    A virtual bookkeeper is an employee that small businesses or business-of-one hire to do bookkeeping, look after the accounts, and maybe provide tax duties too. All these duties are offered remotely. Virtual bookkeepers offer a variety of skills and services for small businesses, depending on the size and complexity of the business.

Some of the services that virtual bookkeepers provide are:

  • Expense tracking
  • Customer invoicing 
  • Accounts receivable and payable management 
  • Bill pay
  • Income tracking
  • Payroll
  • Benefits administration
  • Tax planning and filing 
  • Tax election
  • Company formation

Virtual bookkeepers can be found through recommendations, ad postings, freelancer networks and from other business owners as well.

Virtual bookkeepers can provide the best online bookkeeping services because the services they offer can be customized and varied according to your business demands. It might also be the most expensive option, paying employee wages as well as applicable taxes. 

  • Online Accounting Software

As a business-of-one, your finances might be very simple. In such a case, all you need is an online accounting program that helps you manage your finances and do your bookkeeping yourself. Software like Wave, Xero, FreshBooks, and QuickBooks provide a variety of bookkeeping services which include:

  • Invoice tracking
  • Payroll
  • Online payments
  • Expense tracking
  • Time tracking 
  • Reconciliation
  • Financial reports
  • Inventory management 
  • Estimation and proposals

This software requires an annual or monthly subscription, providing different categories of services that you can choose from. You can sign up at the lowest level and upgrade as your business grows. 

Online accounting software offers the lowest-cost bookkeeping services, but that doesn’t make them the best option. The bookkeeping services provided by online accounting software might be too complex for a business of one. The subscription price and the initial learning curve might not be worth the hassle. They do not offer services like tax filing and formation, so you will have to pay extra for them too.

  • Outsourced Bookkeeping Services

Outsourced bookkeeping services combine the cost-effectiveness of automated software with the comprehensive services of hiring a personal bookkeeper for your business-of-one. It includes a variety of business accounting services which include:

  • Legal formation
  • Quarterly tax estimates and returns
  • Tax election
  • Income estimates
  • Owner salary recommendations
  • Payroll
  • Planning and filing taxes
  • Bookkeeping

Outsourced bookkeeping services like these offered at My Count Solutions provide the best online bookkeeping services, for which you pay a monthly subscription fee and then get bookkeeping support from human service providers. You can also ask for periodic consultations with tax experts and a legal team for the best interest of your business. 

What do Online Bookkeeping Services do?

Online bookkeeping services can change the game for your business, so you must choose the option that fits your business best, cost-wise as well as services-wise. 

Formation and organization

The structure of your business greatly affects the management of finances. If your financial and legal services are not differentiated, it can cause confusion for small business owners, making it inconvenient and costly. Online bookkeeping services can help you with your business structures and set you up for taxes with the IRS. 

Taxes

Online bookkeeping services provide tax support depending on the services you use. Bookkeepers can prepare and plan the taxes but they are not allowed to file taxes. This is why you might require assistance from an online bookkeeping service like those at MyCountSolutions, that can do your taxes for you. 

Accounting

All online bookkeeping services provide accounting services. They help you track your income and expenses, which not only helps you with tax preparation but also decides what kind of decisions to make for the best outcome for your business-of-one. It also helps you price your products accordingly keeping costs manageable. 

Invoicing

Invoicing is a relatively simple task that you can do yourself, and get paid through the monthly invoicing of customers. However, it is a time-consuming process, which can easily be done by an employee hired. Your bookkeeper can handle invoices as well as accounts payable and receivable because all of this can be done using the same software. 

Regulatory Audit

Bookkeeping experts at My Count Solutions verify and edit your financial information providing you with a clear progress report. They provide you with transparent financial reports including statements of all your finances and year-end reports, ensuring that your business grows the best it can. 

How much does online bookkeeping cost?

The prices of online bookkeeping vary depending on the services you require.

Virtual Bookkeepers

Virtual bookkeepers typically charge per hour, starting at $25 and going up to $100 an hour. CPAs generally charge more than bookkeepers that are on the lower end. If you hire a bookkeeper, you need to factor in the cost of hiring a CPA for taxes at least once every year.

CPAs

CPAs generally charge a flat rate annually for tax returns. The cost range depends on the size, revenue, and complexity of the business. For a business-of-one, a CPA would typically charge around $500-$1500 per annum. 

Online Accounting Software

Software charges a monthly subscription fee and generally offers discounts on annual subscriptions. Online accounting software charges as low as $100 for mere invoicing and expense tracking, and the charges go up to $300+ if you’re using the multiple user and multiple companies categories. 

Outsourced Bookkeeping Services

Outsourced bookkeeping services charge a flat monthly price which includes all the services they provide. At My Count Solutions, our fee is $325 per month if your business requires all the complex bookkeeping services, and the fee is $300 if paid annually. 

What to Consider When Choosing Online Bookkeeping?

Some of the questions you need to ask that can help you decide on hiring a bookkeeping service are:

  • The number of clients/customers you have?
  • The number of invoices that need to be sent every month?
  • Is your business product-based or service-based?
  • Annual revenue?
  • What method of payment do you prefer?
  • The number of employees?
  • Are your clients based in the U.S. only or internationally?
  • Is tax support needed throughout the year or in tax season only?
  • Do you require assistance with legal formation?
  • How much do you want to be involved in your bookkeeping? 

How Can My Count Solutions Help?

Hiring an online bookkeeping service might seem like an easy decision but it is one that hugely impacts your business-of-one, and can help it grow. Bookkeeping experts at My Count Solutions optimize the process for you and manage finances, prepare financial statements and file your taxes for you. Bookkeeping services are provided to you at a fraction of the cost in an easy and efficient manner. At MyCountSolutions, the services offered are:

  • Financial consultation
  • Run business smoothly
  • Remote bookkeeping 
  • Zero tax filing stress