Trades · Plumbing contractors
Bookkeeping for plumbing contractors.
Most plumbing shops run two businesses under one name. Service calls are small, quick and paid on the day. Construction is large, slow and paid in draws. They earn money differently and go wrong differently, and one set of blended numbers hides both. Here is what that means for your books, and what I do about it.
488
90%
$1.82
Plumbing · trade profile
2026
L&I plumbing contractor
July 2021
$6,000
Required
0306
$1.8222 / hour
Two businesses
Service and construction, under one name.
A service call is a small ticket with a high margin, paid before the truck leaves. A construction job is a large contract with a thin margin, paid in draws over months. Put them in one set of numbers and neither side tells you the truth.
The blended margin is real arithmetic and useless information.
It is too low to describe service and too high to describe construction, so it cannot tell you which side to grow, which one to price up, or which one is quietly carrying the other.
- Separate income accounts for service and for construction.
- Costs split the same way, so each side has its own gross margin.
- Both on one page every month, side by side, in the same format.
Flat rates
A flat rate is a bet on the clock.
Flat-rate pricing is good for customers and good for selling. It also means the price stays put while the job runs long. Job costing is how you find out which tasks in the price book are quietly losing.
Keeping the price book honest
A price book is built on assumptions about time and parts. The books hold the real answer, ticket by ticket, as long as the time and the parts are recorded against each call.
- Time and parts on every ticket, not just the price charged.
- Price-book tasks compared with their real cost a few times a year.
- Callbacks charged to the original ticket, so a repeat visit shows up as the cost it is.
Sales tax
Five calls, five invoices, four tax rates.
Washington taxes construction and repair work where it is done. A service truck that crosses four cities in a day charges four different sales tax rates, and each invoice has to carry the right one.
- Every invoice carries the job address, not only the billing address.
- The rate on each invoice matches that address for that quarter. Rates change, so a rate set once and left alone drifts.
- Sales tax reported by location on the excise tax return, which only works if the books know where each sale happened.
Each city also runs its own business tax. The city pages cover them one by one.
The landlord problem
The customer who pays is not always the customer whose pipes you fixed. A property manager in Bellevue with a rental in Kent pays the Kent rate. Bill from the job address and it is right every time.
Van stock
The parts on the truck are still your money.
Fittings, valves and cartridges bought in bulk ride around on the trucks until a job uses them. Expense them the day they are bought and the job costs are wrong twice: too high the month you buy, too low the month you install.
Three numbers worth knowing
- What is on the trucks, counted a few times a year.
- What went into each job, recorded on the work order, not in a monthly lump.
- What went out on callbacks, charged to the job that came back, so warranty work shows its real cost.
The gap between what was bought and what those three numbers account for is shrinkage. Most shops are surprised by it the first time they look.
L&I premiums
Plumbing hours and heating hours are priced differently.
L&I charges workers’ comp for every hour worked, at a rate set by the risk class. Plumbing, class 0306, is $1.8222 an hour in 2026. If your account also carries the heating class, 0307, every hour has to land in the right one.
Splitting hours the way L&I accepts
When an account carries more than one class, each worker’s hours are reported in the class of the work they actually did. L&I does not accept percentages or estimates, and hours without original time records go to the highest-rated class the worker was exposed to.
- Time records that name the class of work, kept as the work happens.
- Premiums coded to the jobs that generated the hours.
- What L&I billed reconciled each quarter. Payroll itself stays with your payroll provider.
The work
What I actually do about all this.
I keep the books. I do not file your taxes and I am not your CPA. What I do is make sure the numbers behind every one of those filings are right, and hand your tax preparer statements they can work from without rebuilding anything.
- Service and construction kept apart, each with its own income, costs and margin.
- Time and parts on every ticket, so flat rates can be checked against real costs.
- Sales tax by job address, ready for the excise return location by location.
- Van stock and callbacks recorded, so job costs and the balance sheet both tell the truth.
- Every account reconciled to the penny against its real statement, every month.
Where to start
Behind on the books, or not sure they would survive a look? Start with cleanup. Running fine but want them kept right? Start with monthly.
Questions
Questions plumbing contractors ask.
Don’t see yours? Email me at paulaleksic@apcbookkeeping.com
One company, two ways of making money. Splitting income and costs between them is a setup job in QuickBooks, done once. After that, every monthly report shows both sides without any extra work from you.
Mostly dates and costs. The licence runs 24 months at a time, the bond has to stay in force, and a certified plumber has to stay designated to L&I. I keep the renewal dates on the calendar and the bond and insurance costs in the right accounts, so none of them lapses unnoticed.
No, the counting happens in your shop. I set up how it is recorded, give you a simple count sheet, and put the result in the books so that job costs and the balance sheet both reflect what is actually on the trucks.
No. Payroll and the quarterly L&I report stay with a payroll provider, and I can introduce you to one I trust. My side is making sure the wages, taxes and premiums it produces land on the right jobs and in the right accounts, and that what L&I billed ties out to the hours in your books.
With cleanup: rebuild the ledger from your statements, reconcile every account, and find out where things really stand before anything else is filed. Multi-year cleanups are routine work here, and once they are done the monthly routine keeps the books from slipping again.
Book a free consult
Tell me where the books stand.
Fifteen questions about your business and your books. I read every one personally, and you get a straight answer about what it would take to see your service and construction work clearly.