What is Your Bookkeeper Legally Responsible for? Here’s What to Know
March 13, 2025
There’s a common misconception that because of the financial responsibilities of a bookkeeper, there’s an equal amount of legal responsibility—and while there IS a legal obligation, it’s likely not what would you expect.
Most of this comes from being unsure of what a bookkeeper does for your business, but it also stems from both finances and legal being the more “mysterious” side of business ownership.
To clear things up, we’re covering exactly what your bookkeeper is legally responsible for—and what they’re not.
What Your Bookkeeper Isn’t Legally Responsible for
A bookkeeper has very little legal responsibility for your business—they’re not responsible for:
- Auditing your transactions
- Confirming expenses against receipts (although it IS best practice)
- Advising on tax matters (always consult with a tax professional)
While your bookkeeper helps you keep track of and record your transactions and receipts, you’re ultimately responsible for providing accurate information for your bookkeeper to record.
As for tax matters, your bookkeeper can recommend best practices (such as the amount to set aside for taxes each month), but you should also consult a tax professional for an exact estimate.
So, What is Your Bookkeeper Legally Responsible for?
Most of what your bookkeeper is legally responsible for relates to the services agreed upon in your contract. For example, your bookkeeper is responsible for:
- Delivering the services agreed upon in your contract
- Keeping your information private and secure
- Recording daily transactions and maintaining a general ledger (usually, if in a retainer)
The specific services will vary based on the services you’ve hired your bookkeeper to complete. For example, if you’re investing in a bookkeeping clean-up service vs. a monthly bookkeeping retainer, what your bookkeeper is legally responsible for will look different.
Why Hire a Bookkeeper?
Hiring a bookkeeper is not for the legal responsibility of your finances—that will always fall to you in the eyes of the IRS—rather, it’s to keep your finances organized to make calculating your taxes easier and to stay informed about your income, expenses, and identify opportunities.
