Professional services
Bookkeeping for agencies
When client ad spend runs through your card, your revenue looks huge and your margin looks tiny. Good books show what the agency actually earns.
Updated October 4, 2026
In short
Small marketing, design and IT agencies juggle retainers, project fees, contractors and client costs paid on the agency card. We keep pass-through costs separate from real expenses, track every contractor for 1099s, and can report profit by client. Agencies usually sit in our Moderate tier.
How the money moves
How money comes in and goes out
Most agency revenue comes from monthly retainers billed in advance, project fees billed at milestones, and sometimes a markup on media or software bought for clients.
The money going out is mostly people: freelancers paid through Gusto, Bill.com, PayPal or a bank transfer, and sometimes a small staff on payroll. Then there's the software. A ten-person agency can easily carry forty subscriptions across three cards.
Common problems
Where the books usually go wrong
Pass-through spend inflating everything
$15,000 of Meta ads paid on your card and rebilled to the client isn't $15,000 of agency revenue. Booked as if it were, your margin looks far worse than it is.
Contractor paperwork
Every freelancer needs a W-9 on file and a year-end total. Chasing them in January is miserable.
Subscriptions nobody owns
Tools bought for a client who left last year, still billing monthly.
No idea which clients make money
Without class or project tracking, a client who eats twenty hours a month can look the same as one who takes five.
Every month
What we do every month
- Record retainers and project invoices, and match payments as they arrive
- Track client pass-through costs and their rebilling separately from agency expenses
- Keep contractor payments totalled, with missing W-9s flagged early
- Categorize software, with a running list of what you pay for
- Report profit by client or project if you set up classes
A month of books, for example
Take a six-person design agency with four retainer clients and a rotating bench of freelance developers. Each month we'd match the retainer payments, record the developer invoices against the right client, and keep the $3,000 of client hosting and fonts they rebill out of their own expense lines. At quarter end they'd see that their smallest client was actually their most profitable.
Illustrative example, not a client story.
Getting started
What we need from you
- Access to your bookkeeping software and the payment tool you pay contractors through
- W-9s from contractors, or permission to request them
- A list of which recurring costs belong to which client
Software and statements we work from
- Stripe
- ACH invoices
- Gusto
- Bill.com
- PayPal
- Wise
- QuickBooks Online
Price
What it costs
Agencies usually fit the Moderate tier, $400 to $600 a month. Larger teams with payroll, many contractors and client-level reporting can move into Complex.
One flat monthly price, set after the free review. See the pricing guide or estimate your tier.
Questions
Common questions
Can you show profit by client?
Yes. With classes or projects set up in your bookkeeping software, each client's revenue and direct costs can be reported side by side.
We bill retainers a month ahead. Does that matter?
Only if your accountant uses accrual accounting. If they do, we'll set the books up so advance billing is recognized in the right month.
Do you run payroll?
We record payroll from your provider so the books match it. Running payroll itself we'd talk about in the review.
We pay overseas freelancers through Wise. Is that a problem?
No. We record the payments and the transfer fees. Foreign contractors usually don't get a 1099, and your accountant can confirm the right paperwork.
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