Best Online Accounting Firms for Small Businesses 2023 – Small businesses need reliable and affordable accounting services to manage their finances, track their cash flow, prepare their taxes, and plan for growth. However, hiring a full-time accountant or bookkeeper can be costly and time-consuming. That’s why many small businesses opt for online accounting firms that can provide them with professional and convenient bookkeeping services at a fraction of the cost.
Online accounting firms use cloud-based software and platforms to handle various accounting tasks for small businesses, such as invoicing, payroll, bank reconciliation, financial reporting, tax preparation, and more. They also offer access to certified accountants and bookkeepers who can assist with any questions or issues that may arise.
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There are many online accounting firms to choose from, but not all of them are suitable for every type of business. Some factors to consider when choosing an online accounting firm are:
- The range and quality of services they offer
- The pricing and plans they have
- The software and tools they use
- The customer service and support they provide
- The reputation and reviews they have
To help you find the best online accounting firm for your small business, we have reviewed some of the most popular and reputable ones in the market. Here are our top picks for 2023:
1. inDinero
inDinero is our choice as the best overall online accounting firm for small businesses. It offers a comprehensive range of accounting services, such as bookkeeping, tax preparation, financial reporting, cash flow management, accounts payable and receivable, employee reimbursements, document management, and more.
inDinero also provides access to a team of staff accountants and financial experts who can help with any accounting needs or challenges. It has an easy-to-use dashboard and a mobile app that allow clients to monitor their finances and communicate with their account managers anytime, anywhere.
inDinero’s pricing starts at $300 per month for the Essential plan, which is designed for startups and smaller businesses that use cash basis accounting. It also has other plans that cater to larger and more complex businesses that use accrual basis accounting or need CFO services.
2. Xendoo
Xendoo is our choice as the best online accounting firm for franchise and e-commerce businesses. It specializes in providing bookkeeping and tax services for these types of businesses, which have unique accounting needs and challenges.
Xendoo integrates with popular e-commerce platforms and tools, such as Shopify, Amazon, PayPal, Stripe, QuickBooks Online, and more. It also offers monthly financial statements, sales tax filing, income tax preparation, bank reconciliation, profit margin analysis, and other accounting services.
Xendoo’s pricing starts at $395 per month for the Starter plan, which includes up to 10 monthly bank transactions and one state sales tax filing. It also has other plans that include more transactions, sales tax filings, income tax returns, payroll support, and dedicated bookkeepers.
3. QuickBooks Live
QuickBooks Live is our choice as the best online accounting firm for cleanup bookkeeping. It is ideal for businesses that use QuickBooks Online as their accounting software but need assistance with setting up, organizing, or maintaining their books.
QuickBooks Live connects clients with certified bookkeepers who can help with various bookkeeping tasks, such as categorizing transactions, reconciling accounts, closing books, preparing reports, and more. They also offer live video chat support and monthly reviews to ensure accuracy and compliance.
QuickBooks Live’s pricing starts at $200 per month for the Low-volume plan, which includes up to 250 monthly transactions and one connected account. It also has other plans that include more transactions, accounts, custom reports, and dedicated bookkeeping teams.
4. Bench Accounting
Bench Accounting is our choice as the best online accounting firm for bookkeeping services. It focuses on providing simple and accurate bookkeeping services for small businesses across various industries.
Bench Accounting assigns clients a dedicated bookkeeper who handles all their bookkeeping needs, such as recording transactions, reconciling accounts, generating financial statements, and more. They also offer unlimited support via phone, email, or chat.
Bench Accounting’s pricing starts at $139 per month for the Starter plan (billed annually), which includes up to $1K in monthly expenses. It also has other plans that include more expenses, catch-up bookkeeping, tax filing, and advisory services.
5. Pilot
Pilot is our choice as the best online accounting firm for startups. It caters to fast-growing startups that need scalable and reliable accounting services to support their growth.
Pilot uses a combination of software and human experts to provide accurate and consistent bookkeeping services for startups. It also offers tax preparation, CFO services, fundraising support, and other accounting services that startups may need.
Pilot’s pricing starts at $599 per month for the Core plan, which includes up to $30K in monthly bookkeeping. It also has other plans that include more bookkeeping, accrual basis accounting, revenue recognition, and dedicated account managers.
In conclusion, Choosing the best online accounting firm for your small business can be a daunting task, but it can also be a rewarding one. By outsourcing your accounting needs to a professional and reputable online accounting firm, you can save time, money, and hassle, and focus on growing your business.
How to Choose the Best Online Accounting Firm for Your Small Business
There are several factors to consider when choosing the best online accounting firm for your small business. Here are some tips that may help you make an informed decision:
- Know your small business needs: You need first to understand the kind of work or responsibilities you want the accounting firm to handle for your business.
- Look for small business experience: It’s important to choose an accounting firm that has experience working with small businesses.
- Fees: Make sure to compare the fees charged by different accounting firms.
- Ask About Accounting Software: Find out if the accounting firm is familiar with the accounting software you use.
- Decide Whether You Need an Accountant or a CPA Firm: Depending on your needs, you may require the services of a Certified Public Accountant (CPA).
- Range of accounting services: Consider the range of services offered by the accounting firm.
Online Accounting Firms: A Comparison of the Top 5 Services for Small Businesses
Here is a table comparing the top 5 online accounting firms for small businesses according to Investopedia :
| Firm | Category | Pros | Cons |
|---|---|---|---|
| inDinero | Best Overall | An extensive array of services, an easy-to-use dashboard, great customer support, a mobile app | The base package on the expensive end of the spectrum, lacks advanced features such as time-tracking and project manager |
| 1-800Accountant | Best Basic Plan | Full-service bookkeeping | |
| Paro | Best for Hiring Freelancers | ||
| Bench Accounting | Best for Bookkeeping Services | ||
| Pilot | Best for Startups |
The Benefits of Hiring an Online Accounting Firm for Your Small Business
Hiring an online accounting firm for your small business can have many benefits. Here are some of the benefits according to my web search results:
- Save Money and Time: Hiring an online accounting firm can save you time and money by taking care of your accounting needs.
- Reduce Tax Liability and Maximize Tax Deductions/Benefits: An online accounting firm can help you reduce your tax liability and maximize your tax deductions and benefits.
- Comply with Tax and Other Laws/Regulations and Prevent Tax Penalties and Fines: An online accounting firm can help you comply with tax and other laws/regulations, preventing tax penalties and fines.
- Manage Your Finance: An online accounting firm can help you manage your finances, including account reconciliation, payroll processing, cash flow management, monthly statement preparation, and tax services.
- Assist in Making a Business Growth Plan: An online accounting firm can assist you in making a business growth plan.
- Provide Security: An online accounting firm can provide security by ensuring that your financial records are accurate and up-to-date.
- Assist in Setting Up Accounting Software: An online accounting firm can assist you in setting up your accounting software.
- Guide on Financial Planning and Budgeting: An online accounting firm can guide you on financial planning and budgeting.
What to Look for in an Online Accounting Firm for Your Small Business
When looking for an online accounting firm for your small business, there are several factors to consider. Here are some tips that may help you make an informed decision:
- Know your small business needs: You need first to understand the kind of work or responsibilities you want the accounting firm to handle for your business.
- Look for small business experience: It’s important to choose an accounting firm that has experience working with small businesses.
- Fees: Make sure to compare the fees charged by different accounting firms.
- Ask About Accounting Software: Find out if the accounting firm is familiar with the accounting software you use.
- Decide Whether You Need an Accountant or a CPA Firm: Depending on your needs, you may require the services of a Certified Public Accountant (CPA).
- Range of accounting services: Consider the range of services offered by the accounting firm.
Online Accounting Firms vs. Traditional Accounting Firms: Which One is Better for Your Small Business?
Whether an online accounting firm or a traditional accounting firm is better for your small business depends on your specific needs and preferences. Here are some differences between online and traditional accounting firms according to my web search results:
Traditional Accounting Firms:
- Traditional accounting involves setting up an accounting department in-house or hiring the services of a professional accountant to discuss your finances, set up financial systems, and review financial goals.
- Traditional accounting firms offer assistance with audits, payroll management, budgeting, forecasting, and other related tasks.
- Pros: Familiarity (tried, tested, and familiar to CPAs and accountants who have been in the business for a while), Security (focus heavily on paper documentation and keeping everything secure and private).
- Cons: Quality of Information (rely heavily on manual data entry, which can increase the likelihood of errors in bookkeeping), Time-consuming (tasks that should only take minutes can take hours or even days with traditional accounting methods), Cost (large transactions will involve the deployment of large numbers in manpower that will increase costs).
Online Accounting Firms:
- Online accounting firms offer a wide range of accounting services, an easy-to-use platform, access to in-house experts, and a dedicated customer support team.
- Online accounting firms can fulfill the need for a reasonable budget.
- Online accounting firms can perform account reconciliation, payroll processing, cash flow management, monthly statement preparation, and tax services.
- Online accounting firms can provide additional layers of accounting functions to accommodate a growing business’s expanding needs.
The online accounting firms we reviewed above are some of the best in the market, but they may not be the best fit for every business. Therefore, we recommend that you compare their features, pricing, reviews, and customer service before making a final decision.