Finance · 2 April 2021

What is the best accounting software for small business?

What is the best accounting software for small business?

You are a prudent entrepreneur with big dreams, and to achieve these dreams, you are adamant that you are not going to run your business finance in manual books or excel. You want it digital, simple, scalable and able to supply you with strategic information easily.

Having accounting software makes your business administration exponentially faster and more efficient.

What accounting software should I use for small business?

Accounting software used to be large, labour-intensive behemoths for heavy headcount companies. Part of the industry chose to broaden its focus to include smaller businesses. There are many options now with various offerings, some with large price points and various operating specifications.

Now you need to decide which one will suit you, which may require extensive time commitment and comparisons. In this article, we help you speed up that process of choosing by reviewing a shortlist of options with different specifications, complexities and price points.

Online accounting software is the future of SME business accounting. This structure (mostly internet-based) makes it highly compatible with all sorts of hardware: desktop, MAC or laptop. Many also work superbly with tablets and mobiles.

What is the easiest accounting software for small business?

QuickBooks:

This can be a costly option coming at approximately £800 to purchase but they do have a variety of pricing options. It is worth every penny.  Mac and Windows versions can be bought at an upfront cost, but there is also a subscription-based version on the cloud. There are fewer features available for Mac.

There is also a time investment needed as it is a bit complicated to use, but there are a plethora of tutorials online due to its significant popularity. Regular updates keep its appeal.

It does offer a free trial period but be aware that the costs can escalate. One other “disadvantage” is the overwhelming quantity of options.

UK users have additional tools, such as the income tax estimator tool. QuickBooks also has an edition that will suit any kind of user, making edition selection challenging.

It has payroll, mobile payment services and point of sale packages. Its beefier features include business analytics and insights, customised access by role, a restore company data function and automated workflows. A dedicated account manager is part of the deal, plus on-demand online training. Now you know why it’s popular.

Xero:

This was developed from the beginning as cloud-based software. It’s great for Macs and has over 600 features to perform simple or complex accounting tasks easily.

Uniquely it tracks costs, ring-fenced per project. You can also add an unlimited number of users regardless of which package you have chosen. It has some very advanced, market-leading features, making it a better fit for medium and large businesses but has 2, 000, 000 single users (and 16, 000 firms).

It is a bit complex to use, and the UK market has reported customer support problems.

Xero is very robust, can handle complex accounting, is scalable, has ample reports and boasts 700 integrations.

Xero also scores fantastically when it comes to adapting to the modern world. In that sense, for example, it’s one of the few who offer a version of their app adapted for the Apple Watch. Therefore, you don’t have to worry about anything. You can access it no matter what device you own, as long as you have a stable internet connection.

The plans presented on the platform have almost every feature you could think of. This is what makes Xero so good for small and medium businesses. All your accounting can be taken care of in one place, which brings us to this.

Zoho:

Zoho-books-accounting-software Zoho is perfect for smaller size companies that do not have many complex accounting tasks. It’s very easy to navigate and is a very helpful tool when it comes to organising payments. Alongside basic financial tools such as financial statements and manual dashboard entry, it also provides a notification system that notifies you if a client has missed payment upon the agreed terms.

This is an easy-to-use, cheaper option for startups and any new business to use for bookkeeping and all your online accounting needs.

Wave:

Most of these great software features are free and uniquely facilitate tracking personal and business transactions in one software! This makes finance management so much more efficient. It is fundamental, which is why it’s the perfect option for a very small business! Its lack of complex features suits its target market of companies with simpler business models.

Some features, such as payments and payroll, require paid use for them.

It allows double-entry accounting, has excellent invoicing and transaction management, can pre-authorise recurring credit card payments, has a great user interface and navigation tools, supports multiple currencies and does instant payouts.

The record templates are very simple, and the invoice customisation is limited. You can’t offer discounts, and there isn’t dedicated time-tracking. Receipts are unavailable on Android, and payroll, when paid for, is very simple.

It is very suitable for freelancers with simple transactions.

Freshbooks:

This is another simple software but with good tracking, invoicing and payments and is cloud-based. Before you sign on to the monthly subscription, there is a 30-day free trial that you can use to test things out.

PCMag (UK) commented that it “anticipates the needs of freelancers and smaller businesses…better than its competitors”. It is a well-rounded solution and has an attractive double-entry accounting experience. It has an easy to operate invoicing and estimating solution; it handles expenses, time tracking and projects.

The user experience is very, very good. The client records are detailed, and it supports team collaboration and retainer functionality. It has inventory tracking and automatic mileage tracking on iOS.

There is, unfortunately, minimal setup help and some reviews refer to dashboard deficits and limited invoice customisation. Its mobile app lacks some features, and there are also no quarterly tax estimates.

GoDaddy Bookkeeping:

GoDaddy expanded its focus from web hosting to online bookkeeping, and both are suitable for small businesses. Perhaps the accounting software draws the attention of the small business owners to the web hosting services.

Interestingly it might be too simple for small businesses! It is a cheaper option for self-employed individuals and is similar to FreshBooks – with a slight twist. It integrates brilliantly to online platforms (e.g. Shopify and Etsy), tracking payments and invoices easily.

A great option for freelancers as well.

17hats:

17hats is fully integrated, tracking everything you do with your business. The easy access calendars, accounting AND CRM modules also come with to-do lists and lots of other efficiencies.

It’s a breeze to create new leads and facilitates instant responses to customer queries!

It also provides facilities for immediate payments. The invoice templates allow you to create very attractive and professional invoices. There is also a contract customising facility (per client), AND you can sign the deal online.

It sends automatic payment reminders to customers and allows credit card payment processing.

There are automated workflows, and workflow templates can be customised.

What is the best free small business accounting software?

Bokio is a wonderful free accounting software solution that simplifies bookkeeping with artificial intelligence. It suits small businesses, sole traders and freelancers.

This user-friendly, cloud-based system manages invoicing, expenses, financial reports and VAT returns.

User errors are increasingly corrected via the artificial intelligence-led philosophy. When you have grown to a big enough size and wish to outsource to accountancy professionals, you can upgrade to an appropriate version.

Artificial intelligence brings about efficiencies faster via machine learning. Bokio can do automatic categorisation and generally streamlines the bookkeeping process with an utter disdain for the frivolous and unnecessary. The bookkeeping solution also offers automated invoicing and an efficient interface to its smartphone app. Within that, you can update transactions, and it, automatically, of course, recognises values and dates. The available templates are “Smart”, and they automatically handle the categorisation process.

Bokio produces, among other features, balance sheets and profit and loss reports, as well as producing MTD-compliant VAT returns.

All this whilst being 100% free. So how does the company survive to update its software? Its revenue comes from the premium services options that are offered alongside the accounting platform. The primary upgrades include premium support, which means faster replies and more individual attention, i.e. like a dedicated account manager.

The machine intelligence will impress you when you see that Bokio has, for example, spotted an important omission from the business accounts. And when you see that Bokio has spotted that a client has been unwittingly overcharged. The self-teaching system will politely create a prompt that requests your attention to be paid to the ‘xyz’ issue, and this prompt will be automatically loaded into your to-do list.

When Bokio was launched in early 2019, they coupled that with deals on related charged-for services. For example, they offered a £25/month accounting partner service for sole traders (£50 for limited companies), which assisted with items like company formation and HMRC registration, migration of existing accounts to Bokio, management accounts, statutory filings, which included MTD for VAT and unlimited access to a personal adviser and an accounts review. That is a cracker of a deal!

In its home country, viz. Sweden, Bokio has won over 10% of the accounting software market.  There are profound add-on services within the premium feature which are currently only serviced in Sweden but ARE coming to the UK. For example, fully outsourced bookkeeping and advice, analytic benchmarks for business performance, invoice finance and loans to resolve short-term cash flow constraints and links to pension providers and lawyers. In addition, the services of audit and advisory are also in the premium category.

Bokio’s pricing is cleverly called “freemium” pricing. The freemium option does not include payroll, live bank feed connections, multicurrency or issuing purchase orders and quotes. This makes sense as most freelancers, and small businesses do not need those features.

Bokio was born out of a lack of options in the market that actually solved bookkeeping problems properly for freelancers and very small businesses. It also addressed the budget constraints that its target market has. Bokio is prepared to give a lot to entrepreneurs in the belief that they will return for the premium services when their company grows. Their company’s ability to grow is enhanced by the superior service offered by the freemium product.

Bokio’s founders heard the groans of entrepreneurs as admin was mentioned and saw their frustrations when the admin in question was bookkeeping. Bokio demystifies bookkeeping, and the machine-learning driven smart templates remove the smoke and mirrors sometimes found in the charade of accounts.

To further demystify this wizardry called bookkeeping or accounting Bokio software includes a layer so that users and/or business owners can see what’s going on in the background. This eliminates a set of results that arrive on your desk without you having a clue how that result was achieved.

It is clearly an appreciated software as, after launching in the UK market, Bokio has registered approximately 1, 200 customers among small businesses with ten or so employees in the first quarter of 2019!

The founders are cognizant that, in order to introduce the wider menu of premium services, support and outsourcing services, they will require a significant chunk of time. The premium components are not their primary focus, however. They are retaining the majority of the focus on the freemium version as happy customers are key to longevity. They are in it for the long run and want a solid, uncompromised leading product.

The founders are also cognisant of the matter of off-payroll rules, which applies to private-sector employers, as these rules could result in a restriction to the freelance contractor market.

Bokio’s founders are confident they will be ready and competent enough to deal with whatever happens with statutory regulations, macroeconomic factors and Brexit. All factors that are outside of their and everyone else’s control. The system has been built with change in mind and thus, it is a very adaptable system with the ability to adapt very quickly to changing market conditions and adjusted regulations.

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