Bookkeeping and QuickBooks for Cleaning Businesses

Bookkeeping for a cleaning business comes down to tracking labor closely, because wages are usually the biggest cost by far. Record recurring and one-time cleaning income separately, put cleaner pay and supplies against the jobs they serve, reconcile recurring billing monthly and keep mileage records. Done that way, QuickBooks shows which clean types actually make money.

Which numbers should a cleaning business owner watch every month?

Watch labor percentage, recurring revenue and average revenue per labor hour. Those three tell you more than a full profit and loss statement, and you can read them in five minutes if the books are set up right.

Labor % = (Cleaner wages + Payroll taxes + Workers' comp) ÷ Cleaning revenue

You can't calculate revenue per labor hour without accurate hours, which is why crew timesheets tied to each job matter. The labor burden calculator shows your true hourly cost per cleaner, and gross profit per hour explains the metric.

How should a cleaning company set up QuickBooks?

Set up income by type of cleaning and costs by what's tied to the jobs. Ask your bookkeeper or CPA to adjust this to your entity and state; it's a starting point, not tax advice.

• Income: recurring residential, one-time residential (deep, move-in/out), commercial and janitorial contracts, post-construction, add-ons.
• Cost of goods sold: cleaner wages and payroll taxes (or 1099 contractor pay), cleaning supplies and chemicals, equipment consumables like mop heads and vacuum bags.
• Expenses: vehicles or mileage reimbursements, insurance and bonding, software, marketing, office wages, background checks.
• Assets: vans, commercial floor machines and backpack vacuums above your capitalization threshold. See depreciation.

QuickBooks classes let you split results by service line, or by team if you run crews. See QuickBooks classes vs. projects and the chart of accounts explainer.

Should cleaners be on payroll or paid as 1099 contractors?

That depends on how much control you have over the work, not what you call the worker. If you set the schedule, provide the supplies, train them on your checklist and send them to your customers, regulators may see them as employees. The Department of Labor explains that misclassified employees may miss minimum wage and overtime protections they're owed (DOL), and the IRS has its own test (IRS).

If you do pay true independent contractors, you may need to file Form 1099-NEC for them (IRS), and you should have a W-9 on file before the first payment. Read W-2 vs. 1099, 1099 for subcontractors and W-9 for subcontractors, and compare costs with the 1099 vs. W-2 calculator. Talk to an employment or tax professional before you decide.

How do you track supply costs per clean?

Track supplies by job type, not by job. Weighing out product for every clean isn't realistic, but knowing that a post-construction clean uses several times the supplies of a weekly clean is. Once a quarter, divide supply spending by the number of cleans of each type, then check that your prices cover it.

Inventory tracking shows what's in each van and what needs reordering, which keeps you from making emergency store runs at retail prices. Restock rules and par levels are covered in truck stock.

How do you keep recurring billing from leaking?

Reconcile recurring billing against the schedule every month. Leaks in cleaning are small and constant: a client who paused for a month and never got restarted on billing, a card that declined twice, an add-on the cleaner did but nobody charged for. Compare completed cleans to invoices, then check your accounts receivable aging for anything over 30 days. A ten-minute monthly check usually pays for itself the first time.

What taxes do cleaning business owners need to plan for?

Cleaning owners usually face income tax, self-employment or payroll taxes, quarterly estimated payments, and sales tax on cleaning in some states. Use this as a checklist for your tax pro, not as advice.

• Estimated taxes: if you expect to owe and don't have enough withheld, the IRS expects quarterly payments (IRS). Use the quarterly estimated tax calculator.
• Payroll taxes: if cleaners are employees, you withhold and pay payroll taxes every pay period.
• Mileage: driving between homes is deductible business travel when you keep the records the IRS requires (Publication 463). The mileage deduction calculator estimates it.
• Sales tax: some states tax residential or commercial cleaning services, and many don't. Check your state's revenue department.
• Records: keep receipts and records that support every deduction (IRS).

More on the whole system at cleaning business software. To fill the schedule you're now tracking so carefully, see how to get more cleaning clients and the AI receptionist for cleaning companies.