Start up bookkeeping is the part of accounting a founder can and should do before any firm is hired: one company account and card, accounting software connected to both, every transaction categorised within the week, the payroll provider's journal booked with the employer taxes and benefits as their own lines, and the month closed when the bank agrees with the ledger. It is an hour a week if it is never allowed to become a quarter's reconstruction. The close is where the runway is read from, and the free payroll for startups calculator on this site works that reading from the closed month's figures.
One account, one card, one feed
Company money and personal money never share an account or a card; the bank feed and the card feed go into the accounting software from the first week; every transaction is categorised within the week it lands, against a short chart of accounts the company actually uses. The year-end reconstruction that costs a founder a weekend and a firm's fee is what this prevents.
Payroll as it really costs, invoices as they are sent and received
The payroll provider's journal posts gross salaries, the employer taxes, the benefits and the fee as separate lines; the burn then reads true. Invoices sent are recorded when sent and marked when paid, invoices received when received and when paid, so the cash statement and the bank agree. Contractors are recorded against the year-end forms they will need.
Close the month, read the runway, keep the reading
A month is closed when the bank balance and the ledger agree, the payroll and the invoices are in and the profit and loss is a number. Read the runway from it: cash over net burn. The calculator on this site takes the headcount, the salaries, the taxes and benefits, the other spend, the revenue and the cash, and prints the burn and the months; Pro keeps each month's reading and the hiring scenarios behind it.
Questions people ask about start up bookkeeping
Can a founder do the bookkeeping without training?
Yes, with accounting software fed from the bank and the card, a short chart of accounts and a weekly hour; the firm reads the close and signs the filings.
When does start up bookkeeping need a bookkeeper?
When the weekly hour becomes an evening, usually as transactions and invoices multiply; hand it to a bookkeeping service that closes by a date and keeps payroll at the loaded cost.
What is the first bookkeeping mistake to avoid?
Mixing company and personal money; the second is booking payroll as salaries alone, which under-reads the burn by the employer taxes and benefits.