SaaS books are different: cash arrives up front, revenue is earned over time, and investors judge you on metrics your accounting system doesn’t produce on its own. We set up and run accrual-basis books built for subscription businesses, closed every month and ready for your board.
Book your free consultation
Leave your details and we’ll get in touch to set it up. You get a fixed fee in writing before any work starts.
SaaS bookkeeping and accounting services we handle
- Revenue recognition under ASC 606 for monthly, annual and multi-year contracts
- Deferred and unbilled revenue schedules, reconciled every month
- Your billing system, such as Stripe, reconciled to the bank and the general ledger
- Books in the system that fits your stage: QuickBooks Online or Xero early on, NetSuite or Sage Intacct as you scale, or an AI-native platform such as Rillet or Digits
- SaaS metrics from reconciled books: MRR, ARR, churn, net revenue retention and CAC payback
- A monthly reporting pack for your board and investors
- Tracking the states where your subscriptions may be subject to sales tax
- Research and development costs tagged for your tax CPA
Support that grows with you
Pre-seed and seed
Clean books from day one, burn and runway every month, and a tidy data room when you raise.
Series A
An accrual-basis monthly close, ASC 606 revenue recognition, board reporting and audit readiness.
Growth stage
Budget-versus-actual, forecasting, multi-entity reporting, and support through audits and due diligence.
Bookkeeping services for startups
Early-stage startups need books that are simple to run today and ready for diligence later. We set up accrual accounting from the start, track deferred revenue, R&D and cloud costs correctly, keep your cap table events and SAFE or note financings recorded, and close the books every month. When you raise, your historical financials are already investor-ready. Our startup accounting page shows what we do at each stage. Planning a round? See our fractional CFO services and cash runway calculator.
How does revenue recognition work for SaaS?
Under ASC 606, you recognize subscription revenue as you deliver the service, not when the customer pays. If a customer pays $12,000 up front for an annual plan starting January 1, you record $12,000 of cash and $12,000 of deferred revenue, then recognize $1,000 of revenue each month. After January, $11,000 sits on the balance sheet as deferred revenue: money you have collected but still owe in service.
- Setup and onboarding fees are usually spread over the contract, not booked as revenue on day one
- Usage-based fees are recognized as the usage happens
- Multi-year deals, discounts and bundled services need the contract price split across what you deliver
- Sales commissions on multi-year contracts are often capitalized and expensed over the customer relationship
Is SaaS subject to sales tax?
In some states, yes, and the list is growing. New York, Texas (on 80% of the price), Washington and Pennsylvania are among the states that tax SaaS, Chicago taxes cloud software at 15% from 2026, and California starts taxing prewritten software and SaaS on January 1, 2027. Once your sales into a taxing state pass its economic nexus threshold, you may need to register and collect. Our sales tax nexus checker and state guides for California, New York and Texas explain the rules.
What changed for SaaS research and development costs?
The One Big Beautiful Bill Act restored immediate deduction of domestic research and experimental costs, including software development, for tax years beginning after December 31, 2024. Foreign research costs are still amortized over 15 years. Your tax CPA decides how to apply the rules, including any election for earlier years; we make sure engineering salaries, contractors and cloud costs are tagged in the books so they have the numbers.
Frequently asked questions
When does a SaaS company need accrual accounting?
As soon as you raise institutional money, sell annual or multi-year contracts, or need a financial audit. Cash-basis books overstate revenue in the month an annual plan is paid and understate it for the rest of the year. Accrual-basis books match revenue to the months you deliver the service.
Can you calculate our MRR and ARR?
Yes. We tie your billing data to the books every month, so MRR, ARR, churn and retention come from reconciled numbers, the same ones investors will test in due diligence.
Do you file our taxes?
No. We keep your books tax-ready and work alongside your tax CPA, including tagging the research and development costs they need for R&D credits and Section 174.
Which accounting software should a SaaS company use?
Most early-stage SaaS companies start on QuickBooks Online or Xero. As contracts, entities and audit requirements grow, many move to NetSuite or Sage Intacct, and some choose AI-native platforms such as Rillet, which automate revenue recognition and SaaS reporting. We work in all of them, and we’ll tell you when your current system is holding the close back.
What is deferred revenue in SaaS?
It is cash you have collected for service you haven’t delivered yet, such as the unused months of an annual plan paid up front. It is a liability on the balance sheet and becomes revenue month by month as you deliver the service.
How do you reconcile Stripe to the books?
We match each Stripe payout to the charges, refunds, fees and disputes inside it, record gross revenue and fees separately, and tie Stripe’s customer balances to deferred revenue and receivables in the ledger every month.
What is the difference between bookings, billings and revenue?
Bookings are the value of contracts signed, billings are what you invoiced, and revenue is what you earned by delivering the service in the period. Investors look at all three, and your books should explain the gaps between them.
Do SaaS startups need an audit?
Not by law for most private companies, but investors, lenders and acquirers often ask for audited or reviewed financial statements, commonly around a Series A or B. Clean accrual books and a monthly close make the first audit far cheaper.
How do you calculate SaaS gross margin?
Revenue minus the cost of delivering the service: hosting, third-party software and APIs used in the product, customer support and onboarding staff, and payment processing. Getting those costs into cost of revenue, rather than operating expense, is what makes the margin comparable.
How soon after month-end are SaaS books closed?
Typically by the 7th to 10th business day of the following month, including deferred revenue, MRR and the board pack.
Get investor-ready SaaS books
Tell us about your billing setup and your next milestone, and we’ll recommend the right level of support.