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Updated Feb 15, 2024

The Best Business Accounting Software Services of 2024

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Mark Fairlie, Business Operations Insider and Senior Analyst
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.
Best for Payments
  • Unlimited users on all plans
  • Pricing starts at £15 per month
  • Free onboarding support
Visit Site
Links to Xero
  • Unlimited users on all plans
  • Pricing starts at £15 per month
  • Free onboarding support
Best for Small Businesses
  • Easy to set up and use
  • Pricing starts at £10.80 per month
  • Integration with many apps
Visit Site
Links to Intuit QuickBooks Online
  • Easy to set up and use
  • Pricing starts at £10.80 per month
  • Integration with many apps
Best for Advanced Features
  • Robust ERP features
  • Customizable pricing plans
  • Payment management system
Visit Site
Links to Oracle NetSuite Accounting Software
  • Robust ERP features
  • Customizable pricing plans
  • Payment management system
Best for Invoicing
  • Create professional invoices
  • Pricing starts at £7.50 per month
  • Automated invoicing
Visit Site
Links to FreshBooks Accounting Software
  • Create professional invoices
  • Pricing starts at £7.50 per month
  • Automated invoicing
Best for Microbusinesses
  • Automated accounting tasks
  • Pricing starts at $14 per month
  • Useful client portal

 

Visit Site
Links to Zoho Books Accounting Software
  • Automated accounting tasks
  • Pricing starts at $14 per month
  • Useful client portal

 

Table of Contents

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What is Accounting Software?

Accounting software offers features for tracking the revenue and expenses of a business. The best small business accounting software has a wide range of reports that allow you to analyse the financial health of your business, as well as dashboards that provide an at-a-glance overview of key financial aspects like accounts receivable, accounts payable, historical sales data and cash flow. Small business accounting software is also useful for tax management, ensuring you’re accurately estimating all your tax liabilities and saving money accordingly. The best accounting software integrates with other key business systems like payroll software and HR software, eliminating the need to enter the same data manually in multiple systems.

Small business accounting software offers features for tracking the revenue and expenses of a business. The best accounting software for small business offers a wide range of reports that allow you to analyse the financial health of your business, as well as dashboards that provide an at-a-glance overview of key financial aspects like accounts receivable, accounts payable, historical sales data and cash flow. Small business accounting software is also useful for keeping on top of your taxes, ensuring you’re accurately estimating all your liabilities to HMRC and saving money accordingly.

The best accounting software integrates with other key business systems, like payroll software and HR software, eliminating the need to enter the same data manually in multiple systems. We reviewed dozens of the most popular accounting software platforms available today and narrowed it down to the best 11 options. Cost, ease of use and setup, customisability, key features, and ideal use cases were among our top considerations.

TipTip
Small business accounting software can assess your company’s financial health, manage taxes, monitor key financial metrics, and help you make sound financial decisions.

Accounting software is an essential ingredient for a successful business. Depending on the program, it can help you create professional invoices, record incoming and outgoing payments, identify and follow up on past-due receivables, streamline tax management, and run reports that analyse your company’s financial health and project for the future.

To help you find the best accounting software for your small business, we examined a selection of the most popular platforms on the market today. We looked for affordable, easy-to-use accounting programs that included time-saving features like automated bank feeds, automatic payment reminders, and online invoicing and payment acceptance. We also searched for software with comprehensive, customisable, real-time financial reporting because that will help you better monitor and understand your company finances.

Compare Our Best Picks

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Our Top Picks for 2024
Intuit QuickBooks Online
Oracle NetSuite Accounting Software
FreshBooks Accounting Software
Zoho Books Accounting Software
Melio
ZarMoney
Plooto
Wave Financial
Sage
Neat
Rating9.0/109.5/109.0/109.0/108.5/108.0/109.0/109.0/108.0/109.0/107.5/10
Use case

Tracking and paying bills

Small businesses

ERP tools

Invoicing

Microbusinesses

Free accounts payable

Inventory management

Automating accounts payable

Free option

Basic accounting features

Receipt management

Starting price

£15 per month

£10.80 per month

Custom

£7.50 per month

Free and from £10 per month

Free

£12 per month

$32 per month

Free

$10 per month

$16.66/month (annual prorated)

Free trial period

30 days

30 days

14 days

30 days

14 days

N/A

15 days

30 days

N/A

30 days

14 days

Mobile applications

Yes

Yes

Yes

Yes

Yes

Yes

No

No

Yes

Yes

Yes

Integration options

Yes

Yes

Yes

Yes

Yes

Limited

Yes

Limited

Yes

Yes

Yes

Bill pay tools

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

No

Review Link
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Our Reviews

Xero: Best for Payments

  • Xero offers thousands of app integrations with which to manage all aspects of your business.
  • You can access Xero support services via email and live chat 24 hours per day.
  • You must file a support ticket online to request a customer service phone call.
Editor's Rating: 9/10
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We chose Xero as the best accounting software for tracking and paying bills. Xero enables you to maintain excellent relationships with your suppliers and creditors while avoiding costly late fees. With Xero, you can be sure that your cash flow is positive so you don’t come up short when it’s time to pay. On the user-friendly, customisable dashboard, you can see when each bill is due and review your invoices. The spare interface gives an immediate picture of your business’s financial position. You can view costs as they happen in real time, then make instant modifications.

As Xero is cloud-based, you don’t need to download or install any programs. It offers professional double-entry bookkeeping functionality, so your transactions will be entered as a debit as well as a credit. This software also saves you time because you can schedule upcoming payments and batch pay suppliers in advance, automating a process that is typically manual. The new Hubdoc service allows you to capture data from bills and receipts. This further reduces your workload by eliminating manual data entry.

Intuit QuickBooks Online: Best for Small Businesses

  • QuickBooks Online has accounting features to meet the needs of businesses of all sizes.
  • QuickBooks’ live bookkeepers and Certified Pro Advisors provide professional help and guidance.
  • Only the highest-priced QuickBooks plan allows for an unlimited number of users.
Editor's Rating: 9.5/10
Visit Site

We found QuickBooks Online to be the best overall accounting software for small businesses. It provides four plan options for small businesses, as well as a separate option for self-employed users. Each offers features that are suitable for a range of small businesses, whether they’re startups or established companies. Between the four options for small businesses, you’ll have access to all the tools and reports you’ll need and you can upgrade your plans easily as your business grows.

The platform is also easy to set up and use, allowing you to do everything by yourself to get your accounting software up and running. However, if you want extra assistance, Intuit offers access to professional bookkeepers and accountants who can help you configure the software in a way that makes sense for your business. In addition, QuickBooks Online allows you to create bespoke invoices and forms so your company’s branding is always at the forefront of client-facing communications. For the features and services you get, the price is a bargain.

Oracle NetSuite Accounting Software: Best for Advanced Features

  • NetSuite offers a variety of advanced features, including enterprise resource planning tools.
  • The software focuses on automation, making it simple to send and collect invoices and complete other key accounting tasks.
  • The website isn’t clear about pricing, so you need to contact a sales representative to determine the cost.
Editor's Rating: 9/10
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We chose Oracle NetSuite as the best accounting software option for midsize and growing businesses that are in search of advanced features. As part of its robust enterprise resource planning (ERP) offering, Oracle NetSuite offers a cloud-based financial management solution that can track your financial data and automate a variety of essential accounting functions. Like any highly rated accounting software, it offers reporting, planning and billing capabilities. It also easily integrates with other software, including Oracle’s comprehensive suite of business solutions. It can also be used with multiple currencies, so it’s a great option for companies with a global customer base.

If your business needs to expedite its accounts receivable and payable, accelerate deal closings, and keep up with more complex financial compliance obligations while taking advantage of a full suite of powerful business management features, Oracle NetSuite is ideal. Moreover, it doesn’t limit the number of users or rely on third-party apps for customisation. However, it may be cost-prohibitive and present a steep learning curve for small businesses that don’t need access to the advanced slate of features it provides.

FreshBooks Accounting Software: Best for Invoicing

  • FreshBooks lets you easily create invoices, accept payments through invoices, track expenses and send automatic reminders.
  • You receive a full suite of accounting tools to manage tasks like tracking time and expenses as well as running financial reports.
  • If you need to add several team members to the software, that can get expensive.
Editor's Rating: 9/10
Visit Site

We recommend FreshBooks as the best software for invoicing. Not only can you create branded professional invoices, but you can also track the status of invoices so you know when customers received their bills and when their balances are due. It also allows online invoice payments so customers can pay you directly from the invoice.

The FreshBooks dashboard is simple to navigate and includes time and expense tracking, project management features, and tools to create proposals that you can send to prospective clients. If you have employees, you can give them access to their projects and track their time and additional expenses. The company recently launched an add-on with Gusto for full payroll integration, and also introduced a certification system for accountants. Bank reconciliation is performed continuously, which makes the software unique among competitors. FreshBooks has over 100 partners, so you can add plenty of features and connect with other business programs.

Zoho Books Accounting Software: Best for Microbusinesses

  • Zoho Books has apps for popular operating systems and devices, including Apple, Android and Windows.
  • Through Zoho Books, you can send invoices, reconcile accounts, track and manage bills and supplier credits, and accept payments on the go.
  • Zoho Books imposes a limit on your annual invoice volume, which may be challenging for some businesses.
Editor's Rating: 8.5/10
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We selected Zoho Books as the best accounting software for people with microbusinesses. Not all accounting software programs are appropriate for freelancers, independent contractors, sole proprietors, consultants, home-based businesses, individuals operating e-commerce sites and companies that employ fewer than 10 people. In those cases, the software may be too complicated, unnecessarily powerful and overly expensive. Not so with Zoho Books. It works well for businesses with straightforward invoicing and accounting needs, and the low price (including free options for low-revenue businesses) is attractive for budget-conscious entrepreneurs.

Zoho Books is also scalable. As your SME grows into a larger business, you can make use of the options that allow you to upgrade and integrate with other business applications. An easy-to-use, proprietary programming language called Deluge allows you to build custom functions. You can also access a Zoho professional for help in designing your own functions. It also includes a mobile app to ensure that you can keep up with accounting tasks while you’re on the go. Recent Zoho enhancements include a Snail Mail extension to send physical documents to customers.

Melio: Best Accounts Payable Tools

Melio
Melio logo
  • It’s free to make and accept payments from bank accounts with Melio.
  • You can easily schedule and track payments and control who has access to your accounts payable and receivable.
  • Melio charges a 2.9 percent fee for credit and debit card payments, as well as around £16 for expedited check delivery and international USD transfers.
Editor's Rating: 8/10

We recommend Melio for small businesses seeking a simple user-friendly accounts payable tool. This excellent cloud-based software package sends invoices, receives payments andmanages bills. Melio also integrates with QuickBooks for free. There’s no charge to make payments through a bank transfer, but there is a 2.9 percent fee to pay by credit or debit card. Two paper checks per month are free; after that, they are around £1.20 each.

Melio is very easy to use, offering one of our favourite user experiences. Adding suppliers is quick and intuitive. Melio lets you enter a supplier’s information manually, upload a file with that date or snap a photo of an invoice. You can invite both internal users and accountants to use the software and then assign roles and permissions so you know who is accessing your information and what they are doing with it. You can set approval controls for transactions, thus preventing you from overextending yourself or having a cash flow issue because you paid a bill early.

ZarMoney: Best for Inventory Management

ZarMoney
Zarmoney logo
  • The ZarMoney website clearly lays out pricing, which starts at £12 per month for a single user.
  • ZarMoney offers stock management features typically only available in an ERP or a dedicated stock management platform.
  • ZarMoney lacks a mobile app and tools for capturing expenses or receipt photos.
Editor's Rating: 9/10

We chose ZarMoney as the best accounting software program for companies wanting to better manage stock levels. Organised by “entrepreneur,” “small business” and “enterprise,” the pricing plans reflect each type of company’s needs. The cost is based on the number of users, from one to more than 30. If you add or remove users, ZarMoney will automatically update your account and charge you accordingly. Each additional user costs around £8 per month.

In addition to the transparent pricing, ZarMoney’s powerful cloud-based software includes stock management features unavailable with similarly priced competitors. You can manage stock at multiple locations, transfer stock between locations in one click and manage barcodes. Plus, ZarMoney is easy to use and is adaptable for small and larger businesses, with customisation and dedicated support and training for enterprise users. The software also offers a 15-day free trial so you can test it out before you buy.

Plooto: Best for Accounts Payable

Plooto
Plooto logo
  • Plooto’s payment platform lets you manage payments, approvals and reconciliation from one central location.
  • The software provides accounts payable and accounts receivable automation to speed up payments.
  • International payment transactions are expensive.
Editor's Rating: 9/10

Plooto is our software choice for automating accounts payable. With it, you can manage your payments in one central location, providing you with a clear picture of your finances. Payments, approvals and reconciliation are unified under one dashboard. The software includes smart approval workflows and secure electronic payments, which reduce errors and speed up the accounts payable process. Most notably, Plooto offers business accounts payable and accounts receivable automation, which helps you collect on past-due bills.

You can use the same system to pay all suppliers here in the UK or around the world. The package makes it easy to add payees quickly, either by searching Plooto’s network of 120,000 suppliersor by adding them manually. Once a customer pays, the payment is automatically reconciled. You can pay electronically or via check with the integrations, as well as make batch payments, search records and set payment approvals.

Wave Financial: Best Free Accounting Software

Wave Financial
Wave
  • Wave links with bank accounts and credit cards so that you can track expenses automatically.
  • Wave gives you standard bookkeeping services for free.
  • Wave’s integrations are more limited than some competitors.
Editor's Rating: 8/10

If you’re looking for effective, free accounting software, check out Wave Financial. It offers many important, high-quality accounting features at no cost to you. There are no monthly or annual fees, nor do you have to licence software. Through the cloud-based accounting program, you can create and schedule recurring invoices and payments, as well as set up automatic payment reminders and automatic syncing with your bank and credit card accounts. It also gives you the ability to run financial reports, and it provides you with unlimited accountant connections and transactions. If you want to integrate popular business apps, you can do so at no extra charge.

The only fees you’ll experience with Wave will come from selecting optional add-ons — for example, payroll features — or accepting invoice payments. Wave charges a flat rate of 2.9 percent plus around 47p per credit card transaction, though for AMEX transactions, that 2.9 percent becomes 3.4 percent. Bank payments are 1 percent per transaction, with a minimum fee of around 80p. The company also has additional payroll and bookkeeping services that business owners can access for a fee.

Sage: Best for Freelancers and Self-Employed

Sage
Sage logo
  • Sage Accounting lets you create and send invoices, track payments and automatically reconcile bank entries.
  • Both Sage Accounting pricing plans are among the least expensive accounting software packages we reviewed.
  • The software lacks tax calculation, filing and payment tools.
Editor's Rating: 9/10

Self-employed entrepreneurs and freelancers need to be able to quickly and easily send invoices and track payments. For this reason, Newcastle-based Sage Accounting is our top choice for freelancers, independent contractors and the self-employed. With Sage, you will have an affordable way to keep the cash flowing into your business without unnecessary delays. This accounting software offers well-priced tiered plans with which to create and send invoices and track payments.

The program is fast and easy to set up, and the system is simple to navigate. Sage’s software automates a lot of the accounting processes that are typically manual, such as posting expenses and payments and sending invoices and reminders about past-due bills. The software also automatically reconciles bank entries, saving you time. If you need extra assistance, Sage’s customer service is very accessible, which is good news for freelancers and self-employed people who don’t have accounting expertise. Setup is also easy, with ample resources for getting started and continuing thereafter.

Neat: Best for Receipt and Expense Tracking

Neat
Neat logo
  • Neat is ideal for small businesses that handle a large stream of receipts.
  • The software is easy to install and can be used immediately without extra training.
  • Neat lacks bill-paying functions, and there is no customer service phone number.
Editor's Rating: 7.5/10

As a small business owner, all you may want your accounting software to do is help you manage your receipts and expenses. If so, Neat may be your best bet. This cloud-based tool enables you to upload all of your business receipts with the mobile app and starts at around £160 a year, which equates to around £13.00 a month. Once done, you can categorise each, keeping you well organised and on top of your costs.

With Neat, you’ll have a good understanding of your cash flow and the ability to access interactive charts and run accounting reports that will analyse the financial health of your business. All this can reduce errors often associated with handwritten recording. It also takes the stress out of making sure that you get the right deductions come tax time.

Accounting Software Costs

Accounting software helps business owners streamline billing and accounting, and it doesn’t have to cost a lot of money. Most programs offer several plans to accommodate your needs and budget.

There are typically two types of pricing models for accounting software: perpetual licensing or a recurring subscription. With a perpetual licensing model, you make a one-time payment for unlimited access to the software. With a subscription pricing model, you pay a monthly or annual fee for access to the software.

For subscription pricing, expect to pay anywhere from around £6.75 per month for a basic starter plan to as much as £275 per month for a more advanced service plan. Other factors, like the included features and number of users, affect the monthly cost as well.

TipTip
Some accounting software platforms set maximums on the number of users allowed, whereas others impose no limits. Depending on how many employees will use your software, a no-limit plan may be more cost-effective.

Regardless of the pricing model you select, watch out for hidden fees, which can include charges for customisation options, installation or setup services, integrations, and maintenance or support services.

If your business is on a tight budget, consider free accounting software. Wave, for instance, offers many of the accounting and invoicing features you would find in paid programs. Zoho Books also offers a free plan for businesses with under £35,000 in annual revenue.

When you’re choosing accounting and billing software for your business, we strongly encourage you to take advantage of any free trials to test out the solutions and see which one offers the features and tools you need. Plus, spending time with the software beforehand will help you feel more confident in your decision.

Accounting Software Features

Many aspects of accounting software make it a useful tool. If you’re a small business owner, it’s important to know which features you’ll need. Most online accounting software offers accounts receivable, accounts payable, banking and reporting features. Some programs include stock management, project management, time tracking and payroll tools.

Here are some of the core features to look for in accounting software:

Bank feedAccounting software connects with your bank so that all your banking transactions appear in your online ledger as well.
DashboardThe best accounting software platforms feature organised, customisable dashboards with clear data visualisation and organisation features.
Online invoicingYou can create invoices and send them from entirely within most accounting software — no printing or mailing needed.
Recurring invoicesOften, accounting software platforms include automation features you can use to set the same invoice to send at the same time each month.
Automatic payment remindersMany accounting software platforms regularly and automatically remind your customers or clients to pay outstanding invoices.
Bank reconciliationAll accounting software should be able to match your bank transactions to invoices, bills, purchase orders, expenses and the like.
Financial reportingYou can use accounting software to generate basic forms such as P&L statements or advanced business health reports.
Mobile appsAlmost all accounting software platforms offer iOS and Android mobile apps — some of which include nearly all features available via browser or desktop.
IntegrationsThe best accounting software platforms integrate with POS systems, payroll services, HR platforms, CRM software and more.
Tracking for billable hoursMany platforms include features for tracking your time spent per task or project, or they integrate with your third-party time-tracking platform.
StockmanagementSome accounting software includes tools for tracking your stock, creating purchase orders and keeping your warehouses supplied.
Project-based billingWith this feature, you can bill your clients based on your time spent per project or task and your hourly rates.
Support for multiple businessesSome accounting software platforms enable you to use the same set of tools for more than one business.

Bank Feed

This feature connects the software to your business bank and credit card accounts to receive a daily update of your transactions. This saves time, as you don’t have to upload transactions manually. It also gives you a daily, rather than monthly, overview of your accounts. A real-time bank-feed feature can assist with reconciliation, which allows you to make it a small daily task rather than a monthly ordeal.

Dashboard

When you log in to your account, you’ll be greeted by a dashboard that shows you an overview of your account activity and key metrics, such as cash flow, profit and loss, account balances, expenses, accounts payable and receivable, and sales. Some accounting programs allow you to customise what you see first by rearranging the information in the order you prefer.

Online Invoicing

If your business sends invoices, the ability to email them and accept online payments helps you get paid faster. Most accounting programs integrate with third-party payment processors; others require you to use their in-house processing services. It’s a plus for accounting software to serve as an invoice generator also.

Recurring Invoices

With this feature, you can schedule the system to automatically generate and send invoices for recurring charges, such as subscriptions. You can choose how frequently invoices are sent — daily, weekly, monthly or annually — and indicate whether there’s an end date to the billing.

Automatic Payment Reminders

This feature helps you remind customers about upcoming and past-due payments. Some have sample email text that you can use as is or customise. You can then choose when you want the reminders to be sent. Some programs give you the option to send thank-you emails to customers after you receive their payments.

Bank Reconciliation

Smart reconciliation tools identify potential matches between your bank transactions and the bills and invoices you’ve entered into the accounting software, saving you the hours it would otherwise take to sift through your bank account for this information. You can then approve or deny the suggested matches. The best applications suggest potential matches as you reconcile your accounts, and a few include a reconciliation tool in their mobile apps.

Financial Reporting

Every accounting program can generate financial reports. But some are more basic than others, and some require you to subscribe to a pricier plan for advanced reporting. If you need specific types of financial reports, make sure they’re included in the software application and plan you choose. Detailed reports can help you interpret your financial data to make informed business decisions.

Mobile Apps

Not all accounting and invoicing programs have mobile apps, but the best ones do. There is, however, quite a range in the capabilities of mobile apps. Some can only capture receipts for expense tracking, some allow you to create and send invoices, and others have almost every feature the web-based software does. It’s worth checking if the software you’re considering offers a mobile app and, if so, what features are included in the app that will help you manage your business while you’re away from the office.

TipTip
The best accounting software mobile apps include all the features of the browser version, essentially resembling this version scaled down to smartphone size.

Integrations

The ability to connect your accounting software to other business programs you use saves you valuable time because you don’t have to manually transfer data from one system to another. Payroll, payment processing, the best point-of-sale (POS) systems and the best customer relationship management (CRM) software are just a few of the popular types of integrations that are available with accounting software. Integration with systems you already use also cuts down on training time for employees who will use the software.

Tracking for Billable Hours

If you’re a consultant or your business bills clients by the hour, you need accounting software that allows you to track and bill your time or that integrates with the time-tracking program you already use. This is an important feature for freelancers, contractors and the self-employed.

Stock Management

If you have a retail, e-commerce or distribution business, you need an application that helps with stock tracking and purchase orders. You may need to subscribe to a top-tier plan to get this feature, unless you use ZarMoney. If you need more advanced  functionality, look for software that integrates with a dedicated stockmanagement system.

Project-Based Billing

Firms, freelancers and consultants who work with clients on projects or jobs should look for accounting software that helps them track their projects’ tasks and budgets. The software should allow you to invoice customers for tracked time and bill them for project expenses.

Support for Multiple Businesses

Several programs we evaluated let you add more than one business to your account, though some companies charge extra for this. Also, the types of accounting tools that are important to you will depend on the specific needs of your business. For example, if you’re a freelancer project-based billing might be the most important feature on your list. Or, if you plan to do some work on your mobile device, a full-featured mobile app might be at the top of your list.

Advantages of Business Accounting Software

Managing your finances is vital to the success of your business, and choosing the right accounting software can make that much easier. You’ll reap a lot of benefits when you swap out pen and paper or an Excel spreadsheet for accounting software. Here’s a look at a few of them:

Reduces Mistakes

Human error is by far the biggest cause of accounting and bookkeeping errors. Many accounting professionals cite common mistakes such as spreadsheet errors and incorrect manual entries. Accounting software can help cut down on these costly blunders by eliminating clunky spreadsheet inputs and pulling data directly from third-party business apps.

Improves Organisation

Small businesses can’t afford not to have their finances in order. Whether it’s time to pay the tax bill or forecast for the next year, it can be difficult to get the information you need if you are not organised. Accounting software helps you stay on top of your financial data. It organises financial information, stores it in one location and automates many time-consuming accounting processes, which frees you up to focus on running your business.

Bolsters Internal Controls

Internal controls refer to the rules and procedures established by a company to ensure the integrity of accounting and bookkeeping processes. Accounting software increases the reliability of your measures to help prevent and detect fraud. This can significantly reduce the risk of loss and theft from your business.

Doesn’t Break the Bank

Thanks to cloud-based offerings, the price of accounting software has come down a lot over the years. Today, small business owners have a lot of choice: Accounting software costs range from free to £275 per month. The size of your business and your accounting needs dictate how much you pay. But if that monthly cost means you’ll optimise cash flow, meet tax obligations and identify growth opportunities, it’s probably worthwhile.

Ensures Tax Compliance

Calculating and paying taxes is an essential part of running a business, but it is also complex and often involves a lot of tedious paperwork. Accounting software can help you manage this task. Many accounting software providers have designed programs that calculate VAT, prepare tax forms, and even file taxes with no intervention on your part, which can save you time and hassle. Reporting features can also keep you compliant with HMRC, which increasingly require real-time reporting in the era of Making Tax Digital. AI technology increasingly enables businesses to upload their profits and losses in real time. This is especially important in an era when businesses deal with tax requirements not only in their own countries, but around the world. Fines and punishments for non-compliance can be incredibly burdensome for business owners.

TipTip
There are many tax deductions your business can and can’t take. Accounting software can help you navigate this tricky maze.

Business Accounting Software FAQs

Accounting software records transactions and tracks different accounting metrics. You can set up the software to automatically receive financial information from your bank or use an extremely basic version that might require manually inputting the data. We encourage you to use software that automatically receives financial information from your bank and credit card provider to track your business’s finances. Further, most software solutions store the information in the cloud, so your data will be secure and safe if your computer crashes or you experience other technical issues.

Based on our research, QuickBooks Online is the best small business accounting system. But, depending on the specific needs of your business, another system may be a better fit or better value. For example, if your business provides a service and sends a lot of invoices, FreshBooks might be the best choice for you because of its flexible invoicing features. See our best picks above for our specific recommendations for different business sizes and needs.

You need accounting software that tracks the money moving in and out of your business, with both accounts payable and accounts receivable features. Some software solutions don’t include both accounts payable and accounts receivable information. Also, accounting software should connect to your bank and credit card accounts and automatically download your transactions. If your business is service-based, you may need project management tools. If your business sells products, you may want an accounting solution that has stock management features. Last, look for software solutions that offer greater advantages by connecting to other business applications you already use, such as your POS system, CRM system or the best email marketing software.

For small businesses, the term “online bookkeeping software” is usually interchangeable with “online accounting software.” (However, there is a difference between bookkeepers and accountants.) The best online accounting programs for small businesses have bookkeeping capabilities that allow you to record debit and credit transactions, as well as accounting features that let you run reports and analyse your business’s financial performance. Look for more than just a bookkeeping solution; accounting software should include more detail and let you generate invoices and detailed reports.

It depends on your business. If you generate (or expect to generate) a lot of invoices to send to clients and customers, we recommend that you find a comprehensive accounting application with invoice-generating features. Freelancers should consider using accounting software that can generate invoices.

Online accounting services can perform a wide range of tasks for busy business owners. Some focus on bookkeeping duties, such as entering and categorising transactions, reconciling accounts, and generating financial statements and reports that you can take to your accountant at year end and every quarter if you’re VAT registered. Others provide payroll and tax preparation services. Some — such as virtual controllers, chief financial officers and remote accounting firms — provide high-level accounting services, like internal audits and financial planning and analysis.

For some small business owners, an accounting platform that tracks expenses and sends invoices is all they need. For others, advanced reporting, stock management and e-commerce are more important. The camp you fall into will dictate how much you pay for accounting software. Some accounting software options are free, while paid versions can cost as much as £275 per month. The total cost will be determined by the complexity of the software you choose and how many employees you want to have access to it.

Small business owners should look for accounting software that is easy to install, simple to use, easily integrates with third-party apps, and provides the required range of features and functionality, including invoicing and stock management. The best accounting software enables easy collaboration between you and your accountant.

In regard to accounting software, changing is easier said than done. After all, you already uploaded all your data to the platform and learned how to operate it. Nonetheless, there are reasons to consider a switch:

  1. In the same way you shop for your insurance, you should check out what accounting competitors are offering from time to time. If you find a more affordable supplier that offers the features you need, that may be a reason to consider switching.
  2. If your business grows and your accounting software can no longer support operations, you may be due for an upgrade.
  3. A surefire reason to switch accounting software is if your staff hate it. If they find it difficult to use, you may want to pay attention.

If you are considering switching accounting software, the best time to do so is at the end of your business’s fiscal year. The end of the quarter is the second-best option.

Accounting software is used to extract data from large tax documents, create new journal entries, track payments, send invoices, and eliminate manual data entry. These tasks are both time-consuming and prone to human error. Automation can provide enormous time savings for finance departments that total thousands of hours annually, which is another reason to consider implementing accounting software.

Accounting Software Trends in 2024

In 2020, the global accounting software market reached a value of £9.35 billion, according to data from Allied Market Research. This figure reflects the sector’s steady growth throughout the 21st century. By 2030, the market is expected to reach a value of £55.2 billion, a compound annual growth rate of 19.6 percent across the decade.

Here are some trends to watch going forward.

  • Cloud computing: Prior to the growth of cloud-based technology, accounting software existed solely on one’s computer, with few to no connections with other technologies. This imposed limitations on bank connections and 24/7 access, two major issues that cloud-based technology has solved. Plus, cloud-based technology has fueled the growth of accounting software mobile apps, which are a major asset for any small business.
  • Artificial intelligence: Artificial intelligence is also set to drive continued growth in the accounting software sector. This technology is powering automation tools that streamline key accounting processes, minimising tedious work among finance teams. It’s also behind the early stages of obtaining support from a live chat tool, making customer service easier to provide for suppliers as well.
  • Blockchain: Blockchain technology is another major development revolutionising accounting software. With blockchain, businesses will eventually see transaction records moved to a tamper-proof ledger. We expect this to greatly enhance the security and internal controls provided by accounting software.
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Mark Fairlie, Business Operations Insider and Senior Analyst
Mark Fairlie is a telecommunications and telemarketing expert who has spent decades working across advertising, sales, and more. He is the former co-owner of Meridian Delta, a direct marketing company that he successfully sold to new management in 2015. Through this experience, Fairlie gained firsthand knowledge of the life of an entrepreneur, from conceiving a business idea to growing a company at scale to transferring ownership. In the time since, Fairlie launched a second marketing company as well as a sole proprietorship. He has expanded his purview to include topics like cybersecurity, taxation and investments as they relate to B2B business owners like himself.
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