How to Set Up an Odoo Database for a SaaS Company: Step-by-Step Guide

Odoo is a powerful, modular ERP system that allows SaaS (Software as a Service) companies to manage their operations—from sales and subscriptions to accounting and customer support—in one unified platform. But before a SaaS company can begin using Odoo effectively, it must first set up the database properly, including financial configurations such as Chart of Accounts (COA) and Fiscal Position.

This guide provides a step-by-step walkthrough for setting up an Odoo database tailored for a SaaS company. Whether you're a startup founder or an Odoo bookkeeper for SaaS, these steps will help you establish a strong accounting foundation.

Step 1: Create the Odoo Database

1. Open your Odoo instance (localhost:8069 for local or yourdomain.com for hosted).
2. Click Create Database.
3. Fill in:
4. • Database Name
   • Admin Email & Password
   • Country & Language
5. Accept the Terms of Service.
6. Click Create Database to proceed.

Step 2: Install Core Applications

After logging in to your new Odoo database, install the essential applications for SaaS:

• CRM – for lead and opportunity tracking.
• Sales – for managing quotations and orders.
• Subscriptions – to manage recurring revenue.
• Invoicing / Accounting – to handle all financial operations.
• Website & eCommerce – to set up your SaaS or Shopify-style offering.
• Helpdesk (optional) – for customer support ticketing.

Go to Apps → Search & Install each of these modules.

Step 3: Set Up the Chart of Accounts (COA)

When the Accounting/Invoicing module is installed for the first time, Odoo prompts you to select a Chart of Accounts. This setup is crucial for those offering remote accounting for SaaS startups.

To set up:

1. Go to:
   Invoicing → Configuration → Settings → Fiscal Localization
2. Under Chart of Accounts, select your country’s standard COA, like:
3. • USA: “US - GAAP”
   • UK: “UK - Standard”
4. Click Apply to load the selected COA.

Tip: An Odoo accounting consultant can help customize or import a COA for specific verticals like ecommerce.

Step 4: Configure Fiscal Positions

Fiscal Positions help map taxes and accounts based on customer regions or tax-exempt status.

To configure:

1. Navigate to:
   Invoicing → Configuration → Fiscal Positions
2. Click Create
3. Define:
4. • Name: e.g., “Sales Tax Exempt - US”, “VAT Reverse Charge - UK”
   • Enable Automatic Detection (for region-based application)
   • Add Tax Mapping (e.g., US Sales Tax → 0% if tax-exempt)
   • Optional: Add Account Mapping for revenue adjustment

Example: For UK B2B exports, map 20% VAT to 0% using reverse charge logic.

Step 5: Configure Tax Rules

For SaaS companies and ecommerce businesses operating in any country, defining tax rules properly is crucial. Like a company in USA need to follow below steps for configuring the tax rules in Odoo according to their state sales tax:

• Navigate to:
  Invoicing → Configuration → Taxes
• Common tax types:
• • Sales Tax 8.25% (California)
  • Sales Tax 6.5% (Florida)
• Define if included in price
• Assign tax to specific products or customer locations

Tip: An Odoo finance module expert can automate regional tax mappings using fiscal positions and eCommerce connectors.

Step 6: Customize Journals

Each financial transaction in Odoo is recorded in journals. This is essential for every bookkeeper managing transactions.

To configure:

1. Navigate to:
   Invoicing → Configuration → Journals
2. Review defaults:
3. • Customer Invoices
   • Vendor Bills
   • Bank / Stripe / PayPal
4. Customize journal names, default debit/credit accounts, and sequences.

Step 7: Add Bank Accounts

To add:

1. Go to:
   Invoicing → Configuration → Bank Accounts
2. Click Create
3. Fill in:
4. • Bank Name, Routing Number, Account Number

You can also integrate with:

• Stripe, PayPal, Razorpay (USA, UK supported)
• Enable payment acquirers via:
  Invoicing → Configuration → Payment Acquirers

Step 8: Assign Default Accounts

To ensure accurate postings, assign default accounts for better clarity and management:

1. Go to:
   Invoicing → Configuration → Settings
2. Assign:
3. • Income Account (e.g., SaaS Revenue, Consulting Income)
   • Expense Account (e.g., Software Tools, Hosting)
   • Tax Accounts (Sales Tax Payable, VAT Control)
   • Receivable / Payable Accounts

Step 9: Enable Multi-Currency (If Needed)

For SaaS companies dealing globally:

1. Navigate to:
   Settings → General Settings
2. Enable Multi-Currencies
3. Then:
   Invoicing → Configuration → Currencies
4. Activate needed currencies (USD, GBP, EUR)
5. Manually add exchange rates or enable auto-sync

A bookkeeper for multi-currency transactions can ensure smooth FX accounting and reporting.

Step 10: Test SaaS Workflow

Before going live, simulate a full flow:

1. Create a subscription-based product (e.g., Monthly Plan)
2. Create a customer and fiscal position (taxable/exempt)
3. Generate a quote and confirm
4. Auto-generate invoice and apply sales tax or VAT
5. Post journal entry and process payment
6. Reconcile payment with bank account

Final Step: Secure and Launch

• Enable SSL and backups
• Configure user roles and access rights
• Monitor via Odoo dashboards
• Hire or consult an Odoo accountant / bookkeeping expert for regular review

Conclusion

Setting up an Odoo database for your SaaS company is more than installing apps. With the right financial configuration—including COA, fiscal positions, and taxes—you create a solid foundation for compliance, scalability, and growth.

Whether you're a founder, virtual CFO, or Odoo accounting consultant, following this guide ensures you leverage the platform's full power.

Checkout this video to know more about setting up your Database:

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