It gets easier with the HelloLedger Accounting & Bookkeeping Systems for Law Firm Owners.

Finally gain the clarity & control over your numbers and and make confident decisions about profitability, staffing, and growth.

Law firms run on matters, billable time, trust accounting, and strict professional obligations.
But behind the scenes, many principals are still making business decisions based on financial information that’s late, unclear, or doesn’t reflect how the firm actually operates.

WIP builds up. Debtors stretch out. Partner drawings continue — and clarity comes last.

If you’re growing your firm, managing multiple practice areas, or balancing partner drawings with compliance and cash flow, you need financial systems that support your legal practice — not systems that add friction, uncertainty, or risk.

Whether you run a boutique legal practice, a growing commercial firm, or a specialist practice area, you operate in a world that never truly slows down.

Client matters. Court deadlines. Time recording. Billing cycles. Trust account compliance. Professional conduct obligations. Staff supervision. Constant case progression.

The one thing that never slows down?
Your financial obligations:

• BAS
• Tax
• Payroll
• Super
• ATO deadlines
• Trust account reporting
• Software subscriptions
• Professional indemnity insurance
• Ongoing tax planning
• Client invoicing and debtor follow-up

Most law firm owners will tell you the same thing:

“We’re excellent at the legal work. Running the business side? That’s another story.”

And that’s exactly why so many legal practices operate in a constant state of catch-up, even when the firm appears successful from the outside.

The Hidden Pains Law Firm Owners Feel Every Day

These issues show up across practices — from sole practitioners to multi-partner firms.

Revenue feels predictable… until it isn’t

Billable work might look steady — until it doesn’t convert to cash.

• Matters drag on
• WIP builds up
• Invoicing gets delayed
• Debtors stretch past agreed terms

Partner drawings continue, but the cash doesn’t always follow on time. From the outside, the firm looks busy. Behind the scenes, cash flow feels tight..

Compliance and admin are eating into fee-earning time

Time recording. Billing reviews. Trust transfers. File notes. Staff oversight. Regulatory obligations. CPD.

Every matter creates follow-on admin — most of it non-billable.

The work never truly stops, and the business side often gets pushed to the end of the week… or the end of the month… or the end of the quarter.

You don’t know which matters or practice areas are actually profitable

Fixed-fee vs time-based work
Contested vs non-contested matters
Commercial vs personal legal work
High-touch clients vs streamlined files

Most law firms don’t have true visibility into which work is pulling its weight — or silently draining profit. And even when reports exist, there’s rarely time to step back and analyse them.

Your bookkeeping is always 4–12 weeks behind

Because client work comes first. Court deadlines come first. Staff issues come first.

By the time the numbers arrive, they’re already historical — and the opportunity to adjust pricing, staffing, or billing habits has passed.

You’re constantly wondering: “Can we hire or should we wait?”

Bringing on another solicitor, paralegal, or support staff member is a big commitment.

Most firms make this decision without:

• Clear cash-flow forecasting
• Confidence in future billings
• Visibility over true partner profitability

So hiring becomes a risk — not a strategic decision.

There’s no real clarity on upcoming tax bills

Many firm owners only hear about tax once a year — when the accountant calls with a number they weren’t expecting.

There’s no forward planning.
No time to prepare.
No opportunity to smooth the impact.

Just another unexpected pressure on cash flow.

Your software stack is quietly costing more than you think

Practice management systems. Time recording software. Billing platforms. Payroll systems. Accounting software. Subscriptions layered on over time.

Most firms don’t track:

• What’s actually being used
• What’s duplicating effort
• What it’s really costing the firm

It becomes a silent profit leak.

You’ve outgrown your accountant

You don’t need someone who just ticks boxes and lodges returns.
You need:

• Better systems
• Clearer reporting
• Proactive tax planning
• A partner who understands how law firms actually operate

Because compliance alone doesn’t give you confidence — and it certainly doesn’t give you clarity.

The Tax Traps That Catch Law Firm Owners Out

Most law firms fall into the same tax traps — not because principals are careless, but because legal practices operate in a highly regulated environment where compliance never really stops.

As firms grow, complexity creeps in quietly — and without proactive planning, small decisions can turn into expensive mistakes.

Using the wrong business structure

Many law firms continue operating under structures that made sense years ago — but no longer fit the firm’s size, risk profile, or partner arrangement.

This often includes:

• Sole trader or simple partnership structures
• Companies without appropriate trust overlays
• Service entities that were never properly reviewed or implemented

The wrong structure can mean:

• Higher overall tax
• Poor asset protection for partners
• Limited flexibility in how profit is shared

Increased exposure to professional and personal risk

Poorly implemented (or missing) service trust arrangements

Service trusts can be effective for legal practices — but only when they’re set up, priced, and used correctly.

Common issues include:

• No formal service agreements
• Charges that aren’t commercial or consistent
• Incorrect allocation of expenses
• Structures that haven’t been revisited as the firm has grown

These mistakes don’t always show up straight away — but they substantially increase ATO risk over time.

Confusion between partner drawings, wages, and distributions

In many firms, drawings continue based on habit rather than strategy.

Without clear planning:

• Partners draw cash before knowing the firm’s true profitability
• Division 7A risks can arise
• Trust distribution decisions are left until year-end
• Tax outcomes vary wildly between partners

What feels simple operationally often becomes messy — and expensive — from a tax perspective.

GST errors on fees and disbursements

Common misses:

• Professional fees vs disbursements
• Acting as principal vs agent
• Barrister and search costs passed on to clients
• Incorrect coding in practice management and accounting systems

Even small errors across hundreds of matters can trigger significant corrections — and ATO scrutiny.

Missing deductions unique to legal practices

Law firms often miss — or fail to track properly — deductions such as:

• Professional indemnity insurance
• CPD, conferences, and accreditation costs
• Legal research tools and subscriptions
• Motor vehicle use and logbook compliance
• Home office arrangements for partners and solicitors

Individually small amounts quietly compound into substantial overpayments in tax..

Payroll and superannuation risks

With a mix of:

• Employed solicitors
• Administrative staff
• Casual or contract support

many firms unintentionally misclassify workers or overlook superannuation and payroll obligations.

These errors often surface years later — when back payments, penalties, and interest apply.

No forward planning for tax liabilities

Many firm owners only hear about tax once the year is over — when there’s little that can be done.

No forecasting. No instalment planning. No opportunity to smooth cash flow.

Just a number… and pressure to fund it.

Relying on an accountant who only shows up once a year

This is where the biggest damage happens.
Surprise tax bills. Missed planning windows. No proactive advice. No cash-flow forecasting.
A year’s worth of lost opportunities delivered in one phone call.

Reporting Problems That Stop Law Firms Growing

Law firms need a much higher level of financial visibility than standard compliance reporting provides.
Without it, principals are making decisions in the dark — even when revenue looks healthy.

You need to know:

• Profitability by practice area Fixed-fee vs time-based work, commercial matters vs personal matters, litigation vs advisory work — and which areas actually generate profit once time and overheads are accounted for.
• Matter and client-level profitability Which matters are profitable, which quietly absorb time, where write-offs occur, and which clients consistently erode margins
• Lock-up exposure (WIP + debtors) How work in progress and unpaid invoices affect cash flow, partner drawings, and the firm’s ability to plan ahead..
• True cost to serve Non-billable time, trust accounting admin, file reviews, billing corrections, staff supervision, and partner oversight — costs that are rarely captured properly..
• Team capacity and workflow efficiency How much solicitor and support-staff time is billable vs non-billable, where bottlenecks form, and whether workload is evenly distributed.
• Revenue predictability Understanding matters already in progress, billing timing, completion risk, client concentration, and future workload visibility.
• Cash flow forecasting Payroll, super, rent, software subscriptions, professional indemnity insurance, trust movements, and upcoming ATO obligations
• Trust account movements and compliance impact Ensuring trust balances, transfers, and reconciliations are accurate, compliant, and not masking underlying cash-flow stress.

Most accountants don’t provide any of this. But this is the difference between:

📉 “We think we are doing okay” and 📈 “We know exactly where our firm stands and what’s coming next.”

Why Most Accountants Fall Short for Law Firms

Most accountants don’t truly understand how a law firm operates day to day.

They treat legal practices like generic small businesses — not professional firms with trust account obligations, time-based billing, complex lock-up, partner structures, and strict regulatory requirements.

Traditional accountants focus on BAS and year-end tax.
Law firms need support with billing cycles, cash conversion, WIP management, trust compliance, partner profitability, and risk exposure — areas many accountants simply aren’t set up to advise on.

And when your accountant only appears once a year, they miss the real issues affecting your firm every month: ageing WIP, slow debtors, uneven partner drawings, staffing pressure, and mounting overheads.

That gap is why so many law firms end up with unclear numbers, unexpected tax bills, and no real visibility into what’s driving (or draining) profitability.

How HelloLedger Helps Law Firm Owners Win

You’ve built a law firm that delivers real value to clients.
What’s missing isn’t effort — it’s clarity.

HelloLedger understands how law firms actually operate: billing cycles, lock-up, partner dynamics, trust compliance, and tax complexity. We put systems and reporting in place that move you from reactive to confident.

The HelloLedger App — No More Email Chaos

All tasks. All approvals. All uploads. All bookkeeping. All messages.

In one place, not 9 inboxes. Just one shared workspace where everything related to your accounting, bookkeeping, and advisory support live, with us.

Bookkeeping Built for Law Firms— Real Numbers Every Month

Clean, accurate bookkeeping — delivered on time.
We build systems that reflect how law firms actually work:

• Bank rules aligned to billing and trust movements
• Automated expense coding
• Revenue tracking by practice area
• WIP and lock-up visibility
• Trust account reconciliation support
• Payroll and super workflows
• Software and overhead categorisation
• Cash-flow visibility and forecasting foundations
• Matter or client-level reporting options

Law firms value this because it stops the constant “we’ll sort the numbers later” cycle — and replaces it with dependable monthly insights.

Proactive Tax Planning for Law Firms (Hello Tax Clarity™)

Tax shouldn’t be a once-a-year surprise. We forecast tax through the year, not at year-end. You’ll always know:

• What your next tax bill looks like before it arrives
• Whether PAYG instalments are set correctly
• When to move income or expenses
• How to reduce tax legally and proactively
• Whether your structure is still fit for purpose
• How partner drawings and distributions affect tax
• The most effective way for partners to pay themselves

Tax stress fades when the guesswork disappears.

Advisory for Advice Practices (HelloSuccess™)

Built for professional services. We help law firm owners with:

• Cash-flow improvement
• Lock-up reduction strategies
• Billing and pricing review
• Partner profitability analysis
• Staff capacity and workflow planning
• Contractor vs employee analysis
• KPI dashboards
• Practice-area profitability
• Forecasting and scenario planning
• Owner remuneration strategy
• Margin improvement
• Succession and exit readiness

This is exactly the support many firm owners say they wish they’d had much earlier.

Xero Automation Tailored to Law Firms

We set up or optimise Xero to reflect your firm’s workflow, not a generic business template.This includes:

• Xero tracking by practice area
• Payroll and super
• Expense rules aligned to firm overheads
• Trust and operating account workflows
• Software subscription mapping
• Stripe, PayPal, GoCardless, and direct-debit integrations
• Monthly reconciliation workflows
• Automated recurring invoices where appropriate

The goal:
You save time. Your numbers become reliable. Your decision-making becomes far simpler.

What This Looks Like in Practice

To give law firm owners real, decision-ready clarity, we include purpose-built tools and reporting such as:

• Lock-Up & Revenue Projection — Forecast future billings by combining WIP, billing cycles, and debtor behaviour so you understand revenue timing, not just totals.
• Practice Area Profitability Snapshot — See exactly which practice areas (litigation, commercial, property, family, advisory, fixed-fee work) generate margin and which absorb time without return.
• Matter and Client Profitability Overview — Understand which clients and matters are profitable, which quietly consume disproportionate solicitor and support time, and where write-offs regularly occur.
• Overheads & Risk Cost Snapshot — Track the real cost of running the firm including professional indemnity insurance, software subscriptions, trust administration, staffing costs, and compliance effort and how these affect partner profitability
• Cash Flow Forecast for Law Firms — Map expected billings against known obligations (payroll, super, rent, tax, software, and insurance) so cash flow becomes predictable rather than reactive.

What Happens When Your Law Firm Gets Proper Financial Support

When your firm finally has clean numbers, proactive tax planning, and reporting that actually reflects how a law practice operates, everything feels lighter.
You stop guessing.
You stop reacting.
You start making decisions with confidence instead of fear.

Here’s what typically happens once the financial side of your firm is properly supported.

Bookkeeping backlog disappears, and the numbers become reliable

Law firms typically move from being 6–10 weeks behind to consistent monthly reporting and clear visibility over cash flow, WIP, and lock-up.

Tax bills become predictable instead of stressful

Once PAYG instalments are reviewed and tax planning is done proactively, firm owners stop dreading the ATO and start planning ahead.

Profit improves when legal work is properly measured

Most firms discover they have:

• Certain matters consistently underpriced
• Some clients absorbing excessive non-billable time
• Fixed-fee work eroding margins quietly
• Overheads and compliance costs higher than expected

Once visibility improves, profitability usually follows.

Decision-making becomes clearer

When principals can finally see:

• Solicitor and support-staff utilisation
• Margins by practice area
• WIP and debtor ageing
• Lock-up trends
• Upcoming tax and staffing commitments
• Client-level profitability

…they make hiring, pricing, and strategic decisions with confidence instead of intuition.

Cash flow gets smoother and more predictable

With lock-up mapped, billing cycles understood, and forecasting in place, cash flow stabilises, even during periods of heavy workload or staff change

Admin hours shrink thanks to Xero automation

Firms regain valuable time when:

• payroll and super is automated
• expenses categorised correctly
• software and overheads are mapped properly
• recurring invoices run consistently
• bank and payment rules are set
• month-end follows a clear, repeatable rhythm

This often removes 5–10 hours of admin per month, time that can be redirected to clients, leadership, or simply stepping back.

Ready to Run Your Firm With Numbers You Trust?

If you run a law firm and want an accountant who understands legal billing models, trust account obligations, tax structuring, and the realities of growing a professional practice, we should talk. Phone us today on 0490 033 038.

Clarity, confidence, and proactive support for your law firms,
no matter where you are in Australia.

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