Do Bookkeepers Do Taxes?

When it comes to managing your money, especially for a business, two roles are often mentioned: bookkeepers and accountants. A common question people ask is, “Do bookkeepers do taxes?” The short answer is not usually — but there’s more to it. In this blog, we’ll explain everything you need to know about what bookkeepers do, their role in taxes, and how they work alongside accountants.

What Does a Bookkeeper Do?

Bookkeepers are the people who handle the day-to-day financial records of a business. They keep track of every dollar that comes in and goes out. Think of them as the financial organizers. Their main job is to record and manage financial data.

Here are some of the tasks bookkeepers do:

• Record all business transactions (sales, purchases, payments, etc.)
• Manage accounts payable and receivable (money you owe and money others owe you)
• Reconcile bank statements
• Generate basic financial reports (like income statements or balance sheets)
• Process payroll
• Keep records of receipts, invoices, and other financial documents

So, in short, a bookkeeper keeps everything neat and tidy so the business always knows where its money is going.

Do Bookkeepers File Taxes?

In most cases, bookkeepers do not file taxes. That job usually belongs to an accountant or a certified tax preparer.

Bookkeepers help with taxes by keeping the financial data clean and accurate. They give accountants all the records needed to prepare and file tax returns. So, while they don’t file taxes themselves, they play a very important part in the tax process.

Think of it this way:

• Bookkeeper = Prepares the ingredients
• Accountant/Tax Preparer = Cooks the meal (files the taxes)

Why Bookkeepers Usually Don’t Do Taxes

There are a few reasons why bookkeepers don’t usually file taxes:

1. They’re Not Trained for Tax Laws

Bookkeepers focus on record-keeping and managing daily finances. They are not trained to understand complicated tax laws, deductions, or government regulations. Filing taxes correctly requires special knowledge and sometimes even certifications.

2. They’re Not Licensed to File Taxes

In many places, you need to be a licensed tax professional or a Certified Public Accountant (CPA) to file taxes on behalf of others, especially for businesses. Most bookkeepers don’t have that license.

3. They Work as a Team with Accountants

Bookkeepers and accountants often work together. The bookkeeper organizes all the financial data, and then the accountant steps in to use that data to prepare tax documents and offer tax advice.

Can Some Bookkeepers Do Taxes?

Some bookkeepers may have extra training or certifications that allow them to do taxes as well. For example:

• They may be Enrolled Agents (EAs) with the IRS (in the U.S.)
• They might have taken tax preparation courses and passed the required exams
• Some bookkeepers also work as freelancers or consultants and may offer tax services if they are qualified

But this is not very common, and not all bookkeepers offer this service. If they do, they’ll usually let you know up front.

What’s the Difference Between a Bookkeeper and an Accountant?

To make things clearer, here’s a quick comparison:

So you can see, bookkeepers and accountants both deal with money, but their roles are different. One focuses on tracking money, the other focuses on analyzing and planning around it.

How Bookkeepers Help With Taxes

Even though bookkeepers don’t file taxes, they’re very helpful during tax season. Here’s how:

• They organize all your financial records so your accountant doesn’t have to spend hours sorting through receipts.
• They make sure income and expenses are accurately recorded.
• They ensure no documents are missing, which reduces errors and the risk of audits.
• They help save time and money by reducing the amount of work your accountant needs to do.

Without a good bookkeeper, an accountant’s job becomes much harder. In fact, some businesses hire both a bookkeeper and an accountant to make sure everything runs smoothly.

Should You Hire a Bookkeeper for Your Business?

If you run a business or are self-employed, having a bookkeeper can be a big help. Here’s why:

• You’ll always know where your money is going
• You’ll be ready for tax time
• You can focus on growing your business, instead of paperwork
• You’ll avoid mistakes that could cost you money

Bookkeeping can be done in-house, or you can hire a freelance bookkeeper or bookkeeping service. There are also tools and software (like QuickBooks, Xero, etc.) that make the process easier, and bookkeepers often use them to manage your records more efficiently.

When Do You Need an Accountant Instead?

While bookkeepers are great for everyday financial tasks, you’ll want an accountant if you need:

• Tax filing and planning
• Financial forecasting or strategy
• Help with audits
• Legal financial advice
• Help with business structure and growth

If you have a simple business or side hustle, a bookkeeper might be enough. But as your business grows or your finances become more complex, hiring an accountant becomes more important.

Final Thoughts

So, do bookkeepers do taxes? Most of the time, no. Bookkeepers are not tax professionals, but they are a key part of the tax process. They keep your financial records accurate and organized, which makes tax filing faster, easier, and cheaper.

If you’re running a business, it’s smart to work with both a bookkeeper and an accountant. That way, your day-to-day finances are managed well, and your taxes are handled by someone who knows the rules.

Also Read:

• What Is the Biggest Advantage of Electronic Bookkeeping?
• What is Digital Bookkeeping?
• A Comparison of Bookkeeping and Accounting Indicates That…
• What Services Do Bookkeepers Provide?
• What is a Virtual Bookkeeper?

Frequently Asked Questions