When choosing a name, you will want to consider SEO (search engine optimization, how new clients will find you on the internet) and the name should represent what your business does. This way when some one hears your business’s name, they know your are in the business of cleaning houses.
To brainstorm a name for your cleaning business, start with the words Maid, Cleaning and Service. Put these words at the top of a sheet of paper.
Then start writing as many adjectives and adverbs that match your company. This will help you to create a list of possible business names for you to choose from.
Once you choose a name you will need to verify, no other businesses are registered with the same name in New Jersey. You can do a Business Name search here on the DORES of NJ here to verify your business name is available.
Choose a Business Structure for your Cleaning Business
Before registering your new cleaning business, you will need to know the legal structure for your business. This structure will determine how your cleaning business will file its tax returns and how you as the owner will be taxed on your earnings as well.
It s extremely important that you become familiar with and understand the different structures and how taxes are paid and filed with each. When choosing your business structure, consult with your tax professional. They can also help you file all the necessary paperwork.
The different structures include sole-proprietor, partnership, corporation, s-corporation or limited liability corporation. You can learn more about each business structure here.
Apply for an EIN (Employer Identification Number)
Getting an EIN for your cleaning business is a must if you will be hiring employees.
If you will be operating as a sole-proprietor and not hiring employees, you may be able to use your personal social security number when filing taxes and such for your business. But it is always best to talk to your tax professional to see which you will need.
To apply for an EIN you will file a SS-4 with the IRS. It is free and you can do so on the IRS website. If you file online you will get your number right away.
Additional Resources for starting a cleaning business in New Jersey
The Small Business Development Center has lots of resources for small businesses in New Jersey. They offer online training, new and existing business counseling, as well as business training and events.
The state offers Small Business Workshops to help you in the process of how to register your business in New Jersey. How to report business income in the state. If you have employees, they also provide workshops on employer responsibilities in New Jersey.
Next Steps to start your cleaning business.
Now that you have taken care of the boring (but oh so necessary) legal steps to getting your cleaning business official, you can now start with the Cleaning!
Below are resources on how to operate a cleaning business successfully.
Purchase cleaning supplies and equipment
You’ll need to get all the needed supplies to start cleaning your first client homes. I have that taken care of for you.
You can’t start cleaning houses if you don’t tell people you have a cleaning business.
Your first step to marketing will be to tell all your friends, family and contacts in your phone and email that you have started a house cleaning business and you are currently taken new clients.
Next get your business online. Most homeowners now search for services online before hiring a business. Make sure your business is visible online when a homeowner searches for cleaning services in your area.
Make sure to add your contact information, a list of your services, and a an about me page where you introduce your self. Include high quality before and after images of your cleaning.
Activate a Facebook Business Profile.
Price your cleaning services
Decide whether you are going to price your cleaning services by the hour or by a flat fee. Most cleaning businesses make between $25 – $75 an hour.
Charging by the hour for house cleaning services:
It is best to charge by the hour when you are offering services that will take longer to complete and when the tasks can vary each time you clean a house. When your cleaning times vary it becomes much more difficult to charge a flat fee per clean.
It is best to charge by the hour if you plan to offer the following tasks similar to the following:
picking up clutter/toys
personalizing cleaning service to each client
Charging a Flat Fee
Charging a flat fee is the best way to streamline your business and start building more profits. But a HUGE disclaimer: Only charge a flat fee if you are completing the same cleaning service for each client.
This means you define the checklist and tasks that you will complete at the home. If you do not follow the same cleaning checklist for each client and each time you clean, DO NOT charge a flat fee to clean.
Check out the following articles for more information on Pricing Cleaning service:
If you plan to hire employees you will need to make sure you have filed for an EIN (Review step #4) and have proper insurance (Review step #7).
You will also want to have a training plan in place. In my experience it is best to have a 3 step training plan in place.
Have your new employee read through or watch a video that you have put together on how to clean your way.
Next, have the new employee follow you while you clean. Talk through all the steps they should be taking for each task and room in a home.
Now, you shadow the new employee for a few houses. It is important to correct a any movements that do not fit into your cleaning strategy. For this step you are helping your new employee to develop the same habits to clean a home your way.
Well Kept Clutter helps aspiring entrepreneurs to start their own cleaning business and start making money right away.
A cleaning business needs insurance to protect their assets when the unplanned happens. Accidents happen, right? I know you don’t really want to admit it….But they do.
That is why you carry car insurance, health insurance and house insurance. So why would you not get house cleaning business insurance?
Reason’s why you need house cleaning business insurance
Accidents happen, and when they do you want your business to be prepared and protected. Below are just a few reasons why you need business insurance for your cleaning business.
You could get into a car accident on the way to a clients home.
An employee could spill a harsh cleaner on a clients wood floor and ruin it.
An employee could be stepping on a ladder dusting a high area and fall.
You could be vacuuming and back up into a table holding a very expensive vase that cost more than your car!
If you don’t carry the right kind of insurance, you could be financially responsible for injury or property damage caused by your cleaning service. It is important that you protect you and your business from the first day that you start a cleaning business.
Here is a list of the different types of insurances you should carry and how they protect your client, your employees and yourself.
What Insurance do I Need for a Small Cleaning Business?
GENERAL LIABILITY INSURANCE
What is liability insurance for cleaning business?
Business liability insurance is coverage that protects your companies assets and pays for liabilities incurred because of business operations.
What that means for you as a cleaning business owner is it will cover costs for damage you or your employees caused while cleaning your clients house, up to your plans limits. It will cover the costs if something breaks or is damaged while you are cleaning.
When cleaning multiple homes a day, you and your employees will come across many different surfaces and valuables. Using the wrong cleaning supplies or equipment can damage your clients property.
You will not want to be in a situation that your business is liable for damage and you can not afford to fix it. You will certainly loose that client. But on top of that they will tell all of their friends, co-workers and family members not to use your service.
Your clients will understand that accidents happen. But what will make you more credible and stand out from your competitors is how you handle mistakes. And if you are not properly insured to pay the cost to correct damage to your clients property you will quickly develop a bad name for your business.
How much is liability insurance for a cleaning business?
According to Insureon, 16% of cleaning businesses pay less than $500 year on liability insurance, while the majority pay between $500 – $1000 a year. That works out to be an average cost of less than $100 a month.
The factors that go into the cost of insurance for a cleaning business is the size of operations and amount of coverage you purchase. If you are a small cleaning business or solo cleaner, your liability insurance will be on the lower end of cost. If you have multiple employees cleaning houses each day, your costs will be on the higher end.
How much liability insurance should I buy for a cleaning business?
In my cleaning business, I purchased a policy limit of $1 million per occurrence and $2 million aggregate limit. Come to find out, 90% of companies purchase the same limits.
What is bonding insurance for cleaning business?
Having bonding insurance for a cleaning business will help cover costs for any fraudulent activities like theft, and the insurance company will pay up to the amount of the bond you purchase.
What it means for your cleaning business is that if an employee commits theft inside a clients home, after a claim gets filed and proven liable, the bonding company will cover the amount of the loss.
Bonding insurance is very standard for the cleaning and janitorial industry. Carrying Bonding Insurance (or being Bonded) will help keep your cleaning business credible and build trust with your clients. It is a great selling point and helps eases the a
How do you get bonded for cleaning business?
You will purchase your bonding insurance with the same insurance company that you purchase your liability insurance from. When getting quotes, it is best to get a quote for both liability insurance and bonding insurance.
If you are driving your own car, make sure you contact your current insurance provider. You will want to verify that you are covered traveling between cleaning jobs. Not all personal car insurance will cover accidents which happen during business operations.
If you are purchasing company cars and having employees driving, you will 100% need to obtain coverage for the vehicle and for your employee’s. Having a business specific car insurance coverage will help to cover the costs of any damage your business is found to be liable for during a car accident, up to your plans limits.
WORKERS COMPENSATION INSURANCE
Workers compensation insurance is only needed if you have employees. This insurance will cover costs of injuries to your employees while they are working.
So now you know what types of insurance is out there for your cleaning business. Here are the reasons why you need liability insurance when you start a cleaning business.
WHY YOUR CLEANING BUSINESS NEEDS INSURANCE
1. Stand out above the other ‘so-called’ cleaning companies
I have come across more ‘companies’ like this. They are not a ‘REAL’ business… they don’t register a business with their state, they don’t pay taxes (another topic for another day), they take cash under the table, and they don’t carry insurance.
You will prove yourself a credible business when you can say you carry Business Insurance. Which leads me to reason #2!
2. Use it as a selling point
I can’t tell you how many contracts we received over other companies because we carried liability insurance. Customers loved hearing that they were protected if we damaged their property or if our employees were dishonest.
You can justify your price point (I hope your not under bidding your competition, you’ll never profit successfully!) if you have insurance and Susie House Cleaner does not, you will more likely land the job.
As you are growing your client base and meeting new clients (psst…here’s some awesome low cost ways to grow your client base!) , they will not know you a part from the next stranger on the street. So telling them that you are insured, can give them piece of mind, build trust and assure them that you are a responsible business owner and can protect their stuff….which leads to point #3
3. Protect yourself
I am sure you started your cleaning business to make money…am I right??? Carrying insurance will help you to protect your assets. If you don’t carry the proper insurance when your cleaning business is liable for damages, you can be held liable. You don’t want to work hard at growing your business just to loose it.
How to Get Insurance for Cleaning Business
Now that I have talked you into getting Insurance for your Cleaning Business you need to go out and get some! Make sure to get 3 insurance quotes for small cleaning business (just like you would for your car insurance).
Start with your current Car Insurance company.
I recommend starting with your car insurance company. You already have a working relationship with them, and you may even get a discount for carrying both personal and business insurance with them.
Visit a local Insurance broker.
Brokers will reach out to several different insurance agencies to get the best price and coverage for you. The insurance broker will create a package for your cleaning business insurance needs.
When you are carrying different types of insurances and using different agencies, it will be easier to funnel all through one broker. And most of the time they can lower the cost of insurance for your cleaning business.
Need help setting up your Cleaning Business? I can help! Sign up for my Build your Business Plan email course.
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Types of cleaning services entrepreneurs can easily start with little money. Check out this list of different types of cleaning services you can offer. Choose the right types of cleaning services for your newest business venture.
In this article:
Foreclosure Cleaning Services
Post Construction Cleaning Services
Move-Out Cleaning Services
Residential House Cleaning Services
Vacation Rental Cleaning Services
Different Types of Cleaning Services to offer:
Please note, this article may include affiliate links. You can read the full disclosure at the bottom of the page.
Starting a Foreclosure Cleaning Business
When deciding on the types of cleaning services to offer, keep in mind that foreclosure cleanings will be one of the most labor-intensive cleaning services you can offer. Many foreclosed homes have been abandoned and left in ruins.
What to expect when cleaning foreclosure cleanings
Cleaning foreclosures will not be a glamorous job by any means. A foreclosure is where homeowners defaulted on their mortgage and are forced to move out. When a homeowner is past due with their mortgage banks take legal proceedings to take back the home.
To give some perspective, when I was in College my grandmother bought and sold foreclosures. She hired me to help with the cleaning. We cleaned houses where families left all their belongings. When I say all belongings, I mean furniture, closets full of clothes, and even albums filled with family photos. We had to rent large dumpsters and haul all the belongings out of the home.
Some homes we cleaned had been broken into and trashed. There would be graffitied walls and items left behind were scattered everywhere. We would find broken bottles and at one home we even found a pile of human feces….YUCK! So as I said, these types of cleanings will not be glamorous and will require heavy duty cleaning.
These reasons are why you can charge hundreds/thousands of dollars to clean foreclosures.
Equipment/Supplies needed to clean foreclosures.
As you can imagine from the picture I created above, foreclosure cleanings require heavy duty supplies and equipment to help clean up the mess. Equipment you will want to get will include a heavy-duty shop vac to vacuum up debris, a heavy-duty steam cleaner to disinfect and clean walls and surfaces to remove built up grim, a truck or trailer to help haul away furniture and garbage.
As far as cleaning supplies, foreclosure cleanings will require a heavy duty degreaser, mildew remover, lime and rust remover. When cleaning with these cleaners, make sure to have good ventilation and wear a mask to lessen the amount you will inhale.
How much you can make cleaning foreclosure
You can charge $100s or $1,000’s to clean a foreclosed home. the amount you charge will depend on how dirty a home is, how much you will need to haul away and the size of the home.
It can take a week or longer to clean a foreclosure. When first starting out, it is best to estimate the number of hours it will take to clean and charge an hourly rate. Then add a disclaimer, letting the owner know that your price is an estimate and can vary.
Before pricing a foreclosure clean, make sure to do a thorough walk-a-round to avoid many surprises. Take note of any equipment rentals you may need and add the cost of the equipment rental to the cleaning service price. For example, if you have to rent a large dumpster bin to haul junk add the cost of the dumpster to the cost of the cleaning service.
How to market foreclosure cleaning services
With foreclosure cleanings, you will not be marketing to homeowners. Instead, you will want to market to banks and realtors. Look for local realtors who specialize in foreclosures and begin building relationships with them. Contact banks and speak with their foreclosure departments, find the person in charge of cleaning contracts and start building a relationship.
It is also helpful to attend local networking events with your chamber of commerce. Realtors and banking professionals almost always attend these types of events to network with local businesses. Find your local professional realtor associations and attend their networking events. You can even develop a training presentation on property cleaning restoration.
Starting a Post Construction Cleaning Service
With Post Construction cleaning you will be cleaning homes just after they have been built or renovated. You will be cleaning up after construction crews have left.
If you specialize in construction cleaning, you can offer to clean both the inside and the outside of the home. Many contractors also will hire cleaners to come clean the home in 2 phases.
The first clean would be after all the carpentry is completed and just before finishes like the flooring go in. The second clean would be the final detail clean, just before the homeowner moves in.
What to expect when cleaning post construction homes
Cleaning post construction homes requires hard work and detailed work. If you choose this type of cleaning service to offer, you will be cleaning up construction debris. This may require hauling the debris off the site as well.
To give you an idea of the cleaning think about when you last hung a picture. When you put the hole in the wall, you probably noticed the dry wall dust just from drilling that one hole. Well, after a construction crew leaves, the home is covered in that drywall dust and it will be your job to clean it up.
Your job will be to remove the saw dust, paint or glue from all surfaces including walls, doors, baseboards, appliances, cabinetry, windows and windowsills, light fixtures and of course the flooring. Things like excess grout may need to be removed from tiles, paint splatters may need to be removed from cabinetry, glue may need to be removed from laying wood floors, and factory stickers may need to be removed from newly installed windows.
Equipment/Supplies needed to clean foreclosures
Post construction cleaning will require equipment to help you to haul debris away and clean up the construction residue. A good quality shop vac that can pick up the construction dust with a good filter will be needed. Make sure the shop vac has attachments so you can vacuum inside cabinet drawers, window sills and other hard to reach areas.
Bring cleaning supplies that can remove left over glue, grout, or other finishing residue without ruining the surfaces. Make sure you know what surfaces the cleaning supplies are safe to use on. When I first started, I had cleaned cabinets with a cleaner that scratched the cabinetry. Some of the doors had to be replaced, it was not a fun situation to be in.
Having a truck and trailer will be useful if you have to haul large debris from the construction site. Bring a tall ladder to reach light fixtures or tall windows.
How much you can make cleaning new home/post construction cleaning
As you can see, cleaning a post construction home can involve several man hours due to the tedious tasks of cleaning construction dust and chemicals left behind by construction crews. It can take more than 1 day to clean depending on the size of the home and would require more than 1 cleaner. Because of this, you will be able to charge more for these types of cleanings.
According to home advisor, the national average for these types of cleaning services is $445.00. Your price will of course vary on the size of the home and the scope of work that will be expected. You can also add additional tasks such as exterior cleaning of windows, yard waste, or pressure washing.
How to market new home/construction cleaning services
For new home/construction cleaning services you will want to market to construction firms, general contractors, handy man services and other construction related businesses. These businesses will contract you out to clean homes that they have built or renovated. The homeowners rarely hire the cleaning service for these types of cleans.
To market to construction related businesses make calls or stop by offices to meet either the contractor or whoever oversees hiring subcontractors. The idea is to build a solid relationship so that you can service all their projects that they finish.
It is also very beneficial to visit local chamber events to network and make connections with local contractors. It may be easier to start with smaller firms if you do not have the crew to service multiple projects a week. As your reputation builds you can land larger clients and hire more employees.
Starting a Move-In/Move-Out Cleaning Service
Move-In/Move-Out will be less manual labor than foreclosure cleanings and construction cleaning businesses. Homeowners generally leave the home voluntarily whether they are selling the home or if they are ending a lease/renting agreement.
In each case, there is incentive to leave the home in good condition. But these types of cleanings do take longer to clean than a regular cleaning service where you come in ever 2 weeks to clean.
The homes will be empty or should be when go in to clean a move-in/move-out clean. They will take longer to clean than a recurring house cleaning service would take. You’ll be expected to clean out cabinets/drawers, remove smudges off walls, doorways and trim, dust and clean high to reach areas such as vents, ceilings, and ceiling fans. Expect to clean windowsills and window tracks.
Equipment/Supplies needed to clean Move-In/Move-Out Cleanings
Move-In/Move-Out Cleanings require some heavier tools. For your cleaning supplies make sure you have a heavy-duty all-purpose cleaner, mildew remover and rust stain remover.
For tools and equipment, you’ll need razor blade (a professional tip: this is a great way to remove years of built-up soap scum). Shop vac with hose attachments. This will come in handy when needing to vacuum out cabinets and heavy-duty debris that you don’t want to ruin a residential vacuum with.
A quality high powered steam cleaner that can help clean surfaces and flooring quickly and efficiently. If you get one that has some pressure behind it, you can blast out grim in crevice’s like faucets, drains and toilet seats. A carpet cleaner is not necessary but would be a great upsell if you have a machine to clean carpets with.
How much you can make cleaning move-in/move-out cleaning services.
According to home advisor a move out clean can start at $110 for a small apartment up to $650 for a larger 3,500 square foot home. The larger the home, the longer the cleaning service will cost. You can also to upsells such as carpet cleaning, baseboard painting, small handy man works such as filling in holes in the wall, replacing doorknobs, fixing cabinet doors, etc.
How to market Move-In/Move-Out Cleaning
For Move-In/Move-Out Cleanings you will want to market to Realtors, property management firms and apartment complexes. These businesses will be the ones handling most move-in’s and out transactions. For apartment complex’s do research on their unit sizes. Start by sending in a letter introducing your business and quoting a price per unit.
Property management firms manage rentals of single-family homes, reach out to them to service their rental properties. Relators are either buying or selling homes. Visit local chamber events to network and make connections with local relators to service their home listings.
Starting a Residential House Cleaning Service
Recurring house cleaning services will be the easiest homes to clean. For the most part there won’t be many surprise’s, or heavy-duty cleaning. You will clean the home either on a weekly, bi-weekly, or monthly basis. Therefore, the cleaning will be regular and will not require a lot of heavy-duty cleaning supplies and labor.
This type of house cleaning business is the easier to build a consistent income. When a customer signs up for weekly cleaning at $90/week, you can count on that income each week. That one client will make you $4,680/ year. With each new client that you bring on, your business will continue to grow.
Instead of building relationships with other businesses, you will build relationships with each of the homeowners. Provide a quality, trustworthy and friendly service and you will be able to exponentially grow your business with each new client.
Equipment/Supplies needed to clean recurring house cleaning services.
The great thing about only cleaning recurring house cleanings is you will not need to invest in expensive equipment since you will not be cleaning heavy duty jobs. Therefore, a residential vacuum and a steam mop is all you will need in the way of equipment. For cleaning supplies a good all-purpose cleaner and microfiber towels will go a long way for these types of cleans.
How much you can make cleaning recurring house cleaning services.
Each cleaning service will bring in anywhere from You will make less money with each cleaning service. $65 – $200 a cleaning service. The less frequent you clean, the more you will charge and the larger the home the more you will charge.
To scale this type of business, it is best to develop a cleaning checklist that you will perform at each visit. This will make it easier to set your cleaning prices. Any services outside of that checklist you would charge more for. This way too, you can charge a flat fee based on the size of the home and charge the same rate each cleaning service.
How to market for residential house cleaning services
To market your recurring house cleaning business, you will target homeowners. Networking events that are more focused on homeowners and working professionals will be your target. Local online marketing will be beneficial. Creating a website and linking to local review sites will be great exposure to market to homeowners looking for recurring house cleaning.
You can also target and network with large employers. Reaching out to HR departments to create a relationship and possibly offering free cleaning service to the employee of the year.
Starting a Vacation Rental Cleaning Service
Vacation rental types of cleaning services are more common in high tourism areas. Where I live on the coast of Florida, most of the homes lining the beaches are vacation rentals. So, cleaning businesses can focus solely on cleaning vacation rentals.
Vacation rentals generally have to be cleaned in a very tight timeframe. If you think of a hotel, they have check out at 10 am and by 3 pm the new renters are checking in. Therefore, with these types of cleaning services, you have to clean all areas of the home, plus change out linens and make beds. In addition to cleaning, you may be asked to stock supplies such as soap and paper products.
To save time, some cleaning services will bring clean linens with them and bring back the used linens and wash them after the cleaning. This way they are not doing laundry on top of cleaning.
For the most part these types of cleaning services are predictable and don’t require heavy duty cleaning. Most renters want to get their deposit back so, the home is generally left in a clean manner. There may be the occasional mess, we once cleaned after a 4th of July weekend. There were bottles left everywhere and smudges on walls and surfaces. We had to do a thorough deep clean, and there was so much trash we had to haul bags and bags away.
Equipment/Supplies needed to clean recurring house cleaning services
With vacation rental cleanings you will not normally have to use heavy duty cleaning materials. Most supplies used for recurring house cleaning will suffice for vacation rental cleanings. If you clean in an area where most floorings are tile, it would be a good idea to invest in a good steam cleaning mop. Not like the upright steam cleaners, but those that use steam vapor. These types of steamers cut your mopping time drastically.
A larger industrial broom is also helpful if you have to keep outside patios or garages swept.
How much you can make cleaning vacation rental cleaning services
Vacation rentals do take longer to clean than a recurring residential house cleaning does. Not because the cleaning is harder, but because of the time to replace the linens and restock supplies.
Because of this, the cleaning services will cost slightly more than what can be charged for recurring house cleaning service. Vacation rental cleaning fees can range from $75 – $200 per clean. This depends on the size of the home and the scope of the cleaning. If you are expected to stock paper products and soups, you will add the cost of the restock in your cleaning price. It is normal to charge a flat fee for this. For example, $10 to restock toilet paper, $5 to restock soap.
How to market for residential house cleaning services
To market your vacation rental cleaning business, you will target realtors who specialize in managing vacation rentals. Like move-in/move-out cleanings, you will be working more with realtors than with homeowners.
To find individual rental owners, such as those listed on AirBnB you can list your business on listing site such as TurnOverBnB.
To recap, here are different types of cleaning services you can offer when starting a cleaning business:
Post Construction Cleaning
Residential House Cleaning
Vacation Rental Cleaning
Well Kept Clutter provides resources and a knowledge base to entrepreneur’s looking to start a house cleaning business.
Sign up for our FREE resource library filled with forms to help you with pricing, sample client forms, house cleaning business checklists, expense and income tracking forms, and more.
This guide is to give you an overview of house cleaning business taxes.
So, I don’t know any house cleaning business owner who started their business to do their own small business taxes. If I had to guess, you neither did you. In fact the words small business taxes probably scare you? Well don’t worry they scared me too.
That is why I created this guide to provide my experience and what I have learned as a business owner. Now, I am by no means a tax accountant so article does not take the place of hiring an accountant. These are guidelines from my experience as a House Cleaning business owner only.
Disclaimer: This article is meant to provide general overview of house cleaning business taxes, which should not be construed as professional, financial, tax or professional advice. These are my personal opinions only from my experience as a residential house cleaning business owner.
So, now that we established I am not a tax accountant, but just providing my experience as a residential house cleaning business owner. The first step you need to do in completing your cleaning business taxes is to hire an accountant.
Actually, I thought I could do my own taxes because I previously worked in accounting and auditing before starting my business. I thought, how hard could it be?
Well I got busy and did not realize business taxes have different deadlines than personal taxes. So I filed late and managed to rack up a $1700 tax bill because of it. Yeah, so hire an accountant.
Accountants do not cost as much money as you may think. And if you keep your finances organized as I mentioned above, they will not require many hours to file your returns.
How to save money on your accounting fees
The best way to save money on your accounting fees is to keep up with your bookkeeping through out the year. By doing this you will be saving your accountant lots of time
So then, they just have to take that information and complete your tax returns. If you have a box of receipts and have not recorded them in an accounting software or spreadsheet then they will have to spend the time to do that for you.
Get access to my FREE Resource Library to download a copy of my BOOKKEEPING WORKSHEETS (a client deposit logs and an expense tracking form) to help keep track of your bookkeeping through out the year
Choose a business structure
Your business structure will determine how and what forms you file your business taxes on. So before you file your cleaning business taxes you need to choose your business structure.
House Cleaning businesses come in all different shapes and sizes. Make sure to always consult with an Accountant first before choosing your structure. They can help walk you through the best options for your business and personal situations.
Before you talk to your accountant you can do some research on the different business structures to get a feel for what you may be leaning towards
Corporation – there are different types of corporations as well. Most commonly there are S-corps and C-corps and each have different tax rules.
The Small Business Administration does a good job comparing each of the different types of structures. You can view that here.
Separate Personal Finances from Business Finances
Before you start making and spending money in your cleaning business you must separate your business money from your personal money. To do this, you will need to open a business checking account.
By having a separate checking account it will be easier to see how much money is coming in and how much is going out. When you mix funds, it will be easier to ‘loose’ tax deductions. Your business expenses will get lost in your personal transactions making your tax deductions smaller.
Tax Deductions for Maid Services
Tax deductions are business costs that may be used to reduce your taxable earnings, therefore reducing your tax bill. The rules and laws can change each year, so it is important that you keep up to date on them.
If you complete business functions inside your home you may be eligible for a home office deduction. These areas of the home you use solely for business purposes may be tax deductible. Talk to your accountant to see if this is an option for you. Some questions to consider are:
Do you store cleaning supplies in your home?
Do you wash towels in your home?
Do you complete office tasks.
Vehicle to travel to and from the business
There are 2 separate ways to handle your vehicle expense. Either have a vehicle designated just for business use or you can use your personal vehicle and claim a standard mileage deduction.
Larger cleaning businesses may purchase a vehicle for the use of business. If this is the case you can pay for all of the gas and vehicle expense straight from your business account.
Standard mileage deduction
But most of you may not be running a business large enough to purchase a business vehicle. Instead if I were to guess you are using your personal vehicle to drive to and from your clients homes.
If this is the case, then you would not be paying for your vehicle expense directly from your business accounts. Therefore could instead claim the standard mileage deduction.
Do you have drive on any roads that require toll fees? If so, don’t forget to include them in your cleaning business taxes.
In Florida we have an electronic toll system (called the Sun Pass) where we can go online and down load all tolls that we have paid. This makes it a little easier tracking toll expenses.
Do you use your cell phone to take client calls or to quote cleaning services? If so, a portion of your cell phone bill could be used as a tax deduction.
Did you donate a basket to your child’s school auction or a local event? Or did you donate a cleaning service to a cancer patient who is unable to clean their home at this time? If so the value of that basket or free cleaning is a marketing expense.
More than likely you do not have a lawyer or accountant on staff. If you hire an accountant to to file your taxes, or a lawyer to help develop your cleaning contract, as a cleaning business owner you can deduct those services. Make sure you save your receipts and record all fees for professional services.
Did you buy small gifts for each of your clients for the holiday season? If so the cost of those gifts are a business expense and can be deducted from your business taxes. As always, make sure you save your receipts and record each expense.
Business License and fees
Some counties or states require house cleaning businesses to apply and pay business license fees. If you run your business in an area that requires a business license, the fees that you pay are tax deductible. So make sure each time you pay you renew your license with your state and or county you save your receipt and record it.
Interest or Loans
Do you have a credit card or took out a small business loan and have to pay interest? If so, the interest you are paying is a business expense and could be eligible as a tax deduction for your cleaning business.
Did you know the taxes you pay are also a business deduction. So make sure you don’t forget about those.
Training expenses are business expense and can be used as a tax deduction for your cleaning business.
Always track every expense. This way you know how much money you are spending on your business. The obvious expenses include all cleaning supplies, any equipment you purchase.
Save all receipts. It can be easy to run to Wal-Mart on your way to a job to pick up a cleaner you ran out of or that you forgot to pack for the day. Make sure you save all of those receipts. To help with this keep a small receipt holder in your vehicle. This way when you get out of Wal-Mart you can stick the receipt right in with others.
Some expenses you may forget about:
App’s on your cellphone that you purchase for your business use
Printing expenses such as ink or paper used to print out client forms or letters
Your email service provider if you use one to send out newsletters
Web hosting, if you have a website and pay for hosting this expense is usually paid a year or 2 in advance (don’t forget to add it as an expense when this happens)
Always track your revenue. Without tracking your revenue you will never know how much money you are making from your house cleaning jobs.
A simple way I would track my revenue was by having a calendar of who I cleaned for with the dollar amount of the cleaning fee.
File and Pay your taxes on time
Make sure you ARE paying your taxes. It may be tempting to not claim all of your cleaning earnings, especially those paid in cash to avoid paying taxes. But this is never a good idea. Also, this is why its good to have a separate business account as I mentioned above. So you can actually see how much money you are earning cleaning houses.
If you do not pay or file your taxes on time, you can easily collect hefty fines. I once filed my business taxes late because I did not pay attention to filing date. I racked up $1700 in tax bills. I lost a lot of money. After that I hired an accountant who knew what he was doing and never filed taxes late again. I learned that filing taxes was not my thing!
Save a portion of your earnings for the unknown
A smart business owner will save a portion of their earnings in a ‘rainy day’ fund. This is used for un expected events that you do not plan for. Having this fund can be the difference between a business who can make it long term verses a business who has to shut down when things get rough.
So remember that time when the world got COVID-19 and the country shut down? You probably weren’t able to clean houses, am I right? Well that is the rainy day that you wish you stashed away a portion of your earnings.
Having a cushion, protects you and your business from unknowns that can cost you unexpected money or business loss.
Get access to my FREE Resource Library to download a copy of my cleaning business tax checklist (a client deposit logs and an expense tracking form) to help keep track of your bookkeeping through out the year
I have compiled all of my best tips for running a successful residential cleaning business into 1 area for you to read through. I hope you find it helpful!
There is a lot of information in this post, be sure to pin it so that you come back periodically. The more you implement each of these practices the more successful your residential cleaning business will be!
So, What does a successful residential cleaning business look like?
A successful residential cleaning business is one that
Retains their clients. Basically clients aren’t jumping ship and leaving you.
Has continuous growth in the number of clients each month.
Makes a profit with each cleaning service, meaning there is enough money to pay for supplies, employees, marketing and office expenses, insurance and travel expenses, and still have money left over to pay you.
Generally your profits should be about 10% of your revenue.
Does this sound like your House Cleaning business??? If not continue reading to get it there.
Visit my other Posts for more information on ruining a successful Cleaning Business:
There is this saying in the cleaning industry, if you must bid for a cleaning job set your price 2.5 times more than your normal. The reason being is, you do not want that job!
#7 Have the right tools.
Make sure you have the tools to complete the job. If you do not have the proper tools, you will not be able to properly clean a home. Don’t show up to a house without a vacuum and mop! Trust me it happens 🙂
#8 Service your equipment every night.
Service your equipment nightly to make sure it is in tip top shape. This will serve 2 purposes. One, your equipment will last longer, saving you money. Two, this will ensure you are bringing clean equipment into your client’s homes.
#9 Put yourself out there.
Tell everyone you meet that you are a small business owner of a Fantastic Cleaning service! You never know when you’ll meet your next client. This includes your entire email list and phone contacts. Don’t be afraid to reach out to all of your family and friends and ask for a referal.
#10 Order cleaning supplies in bulk.
Don’t waste money on buying individual cleaning bottles. Find a quality cleaning product and purchase in gallon size. Buying in bulk will save you money increasing your profit margin.
#11 Don’t undercut yourself.
Make sure the prices you are charging will result in profit. NEVER work for less than what you are worth. In the beginning it takes time, but make sure you know how much you need to charge to make a profit. Otherwise you will never make money with your business.
Get my FREE Pricing Worksheet
Take the guess work out of House Cleaning Prices! Download my FREE House Cleaning Price Worksheet.
THANK YOU! Thanks for signing up! Check your email to where you will need to confirm your signup (basically confirm you are not a robot). Your FREE Price Calculator will open once you confirm. See you on the other side!
#12 Don’t overspend with fancy tools and marketing.
If you can’t afford it, don’t make the purchase. My first year I spent $225 a month on an ad in a community newspaper. I was promised huge exposure. I never got ONE call from that ad!!! It was a huge mistake and cost more money than I could afford and took away money I should have spent on other advertising, like google ad words.
Most of my clients came from free or low-cost marketing efforts. If you are first starting out, $225 a month on an ad is WAY out of your price range.
#13 Utilize several forms of marketing.
To be a successful residential cleaning business you need to bring in new clients. Unfortunately there is not just one solution out there that will bring in all your clients. You will need to use several marketing activities such as print, web, editorial, networking, and client referrals to help you bring in more clients.
#14 Use Facebook for FREE advertising.
Join local groups and create a Business account to help spread the word to your local community. You can also use it as a platform for customers to leave reviews.
#15 Have a positive attitude and be Happy!
No one likes to stick around unhappy or negative people. If you are having a bad day, keep it at home. Put on your smile and greet your customers positively.
#16 Never Stop Learning
Learn about the industry, learn the latest products, learn about running a business, learn marketing techniques … There are so many things to learn that you can apply instantly to your business.
#17 Treat Each Home as your Own
Always clean each home as if it were yours. Excellent customer service is what will keep clients coming back each month. Clean thoroughly, try not to break anything, and use quality supplies.
#18 Develop business systems
Developing office functions that can run without you will give you more time to grow your business. Develop systems for accounting, scheduling, communication with customers and others.
What Well Kept Clutter Readers are saying
I got involved more in my community like volunteering two consecutive monthly deep cleans to local cancer patient. it has been absolutely one of the most rewarding things I’ve have ever done but I have also acquired several new clients in a very short period because of it. The new clients have either been the patient’s family members or through the patients in some way. – Gwen Sweeny
Be on time! – Hebony Caldwell
Offer a discount for military personnel – Cristina Powers
Take the Guess work out of Cleaning Prices! Download my FREE House Cleaning Price Worksheet.
THANK YOU! Thanks for signing up! Check your email to where you will need to confirm your signup (basically confirm you are not a robot). Your FREE Price Calculator will download once you confirm. See you on the other side!
Roberta Reed is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.