The right business accounting platform can make an incredible difference to the small businesses in the UK today.
They manage data with cash flow, invoicing, and compliance, so it is essential for any business to find the best accounting platforms that help to streamline financial tasks.
Additionally, as Making Tax Digital (MTD) requirements come into play, selecting a service or software that complies with government regulations is crucial when tax season rolls around.
Choosing the appropriate accounting software or service would save time, increase accuracy, and even offer small business accounting tips through dashboards and insights.
This will guide the best accounting software for small businesses in the UK.
Important Criteria To Look For In The Top Accounting Software
Before making an informed decision, think about your company’s accounting needs and the following features of an accounting software package.
- Cost: Price ranges between basic plans to monthly subscription plans. Recognise each pricing range and whether fees rise with business expansion.
- Functionality of taxes: To make filing VAT returns and other tax duties easier, look for software that complies with MTD. As online tax filing becomes required, this is essential.
- Multiple users and reporting features: These needs are shaped by the size of your company. Think about whether basic accounting or multi-currency transactions require a business account.
Best 7 Accounting Software For Small Businesses
1. QuickBooks Online
Overview: Most small businesses are now adopting QuickBooks Online because of the many functionalities available to beginner and advanced users.
Being one of the best accounting programs for small businesses in the UK, it also helps with VAT calculations and compliance, which makes it perfect for companies who have to follow UK laws.
Features:
- QuickBooks’s user experience (UX) is simple to use and aesthetically beautiful.
- The program can accommodate up to 25 users, and is considerate of growing enterprises.
- Expert accountants evaluate QuickBooks’ bank reconciliation capabilities and reports for professionalism.
- It offers user-friendliness and several features, such as financial report generation, expense tracking, and invoicing.
Cost: The monthly rate for self-employed is £1, which increases to £10 after six months. The monthly cost of Simple Start is £1.40, and after six months, it increases to £14.
The monthly cost of Essentials is £2.80, which increases to £28 after six months. Plus plan costs £3.80 a month, and after six months, it increases to £38.
2. Xero
Overview: Xero is famous for its user-friendly interface and, since it is cloud-based, it makes pretty simple tasks like expense tracking, invoice management, and bank reconciliation.
It has a perfect integration with many third-party apps and services making it very flexible for small businesses wanting to streamline their business operations.
Features:
- Enables automatic reconciliation by connecting directly to your bank account.
- Creates invoices and quotes that clients can pay online.
- Digitally handles supplier payments, bills, and purchase orders.
- Aids in stock tracking keeps your account current while you make purchases and sales.
Cost: £15 per month; regular prices are £30; premium costs £42 monthly.
3. FreshBooks
Overview: FreshBooks is basically the accounting software for freelancers willing to give it a try. Some qualities with which it gained popularity are the ease of use and customer services it provides.
It has some vital functions such as time, expense, and invoicing and is made for the not-so-accounting-savvy to become user-friendly.
Features:
- Make expert invoices
- Automatic reminders for payments
- Keep track of your spending and miles.
- Make reports that comply with tax laws.
- Utilise timesheets to keep track of tasks.
- Simple, user-friendly layout with clear navigation
- Automated billing and regular payment reminders
Cost: Lite: £6 a month for the first three months, followed by £12 a month. Plus: £11 a month for the first three months, followed by £22 a month. Premium: £35 per month after the first three months at £17.50.
4. Sage
Overview: Sage, another payment processing platform established in the UK, was founded in 1981 when its inventor contacted students at Newcastle University to seek their assistance in creating a program for automated accounting procedures.
After almost 40 years, Sage today employs 13,000 people in 23 countries, providing its software to over three million businesses.
Sage is cloud-based and easily connects to your bank account for real-time reporting, much like all the other small company accounting software programs on this list.
Features:
- Multi-currency support and a payroll corporation tax calculator
- Connectivity of bank accounts
- Management of stocks connected to the Stripe system for processing payments.
- Sage Business Cloud Accounting is reasonably priced, straightforward, and user-friendly.
Cost: Micro businesses and sole proprietorships can start for free for three months, after which it costs £14 a month. Standard plan is free for three months, after which it costs £28 a month. Plus plan is free for three months, after which it costs £36 a month.
5. Zoho Books
Overview: Zoho Books is a splendid tool for small businesses with an amazing twist as it has automated workflows, expense tracking, and project management, all of which can be used to ease the little things in financial management.
Features:
- Shows a working demo version to prospective users so they may experience the UI.
- Give contractors or vendors access to critical data by limiting access to reports only.
- Invoices are generated in a matter of seconds, requiring consumers to only verify the facts.
- Sends purchase orders to vendors automatically and notifies users when supplies run low.
Cost: Zoho Books has a free version. The paid plans start with £6 per month. A 14-day trial enable users to get features of the premium plan.
6. Ember
Overview: Ember is an MTD-ready accounting software designed for sole traders and limited companies that helps you save time and money by automating all the most routine tax and accounting tasks.
Features:
- All plans include automated expenses.
- Ability to create and send invoices
- Real-time financial reporting
- Integrations with numerous apps, and open banking.
- Support for more complex queries from its in-house accountants, as well as VAT returns, tax insights, and multi-currency support.
Cost: As a sole proprietor Initial Cost is free. Pro plan: £9 per month. Unlimited plan is £29 per month. As a Limited business Initial Cost is free. Pro plan: £39 a month Unlimited plan is £79 a month.
7. Clear Books
Overview: For small enterprises, Clear Books is an online accounting program that offers basic accounting functions, time tracking, and invoice creation.
Clear Books syncs with your bank account and is available on the mobile app. Today, hundreds of small businesses in the UK use Clear Books.
Features:
- Straightforward and easy-to-use cloud accounting and payroll software.
- Made for companies in Britain
- The UK-based support staff sits next to the devs.
- Good value for the money.
Cost: Small business: £13 a month after the first three months at £6.50. Medium-sized business: £14 a month for the first three months, followed by £28 a month later.
FAQs-
1. Which accounting software is Making Tax Digital (MTD) compliant?
Most leading options like QuickBooks, Xero, Sage, and Ember are MTD-compliant, making VAT submissions and digital tax filing hassle-free.
2. Can I use accounting software if I have no accounting background?
Yes. Most software mentioned, such as FreshBooks and Zoho Books, are designed for ease of use with intuitive dashboards, automated tasks, and customer support.
3. How much does accounting software for small businesses typically cost?
Prices vary widely: entry-level plans start as low as £1–£6/month, while premium plans range from £22–£79/month, depending on features and company size.
4. Which accounting software is best for freelancers or sole traders?
FreshBooks, Zoho Books, and Ember offer affordable plans tailored to freelancers and sole traders with features like time tracking, invoicing, and automated tax insights.
5. Can I switch to another software later if my business grows?
Yes. Most platforms allow data export and migration, and many offer scalability features like multi-user access and expanded reporting tools.
6. Is there free accounting software available?
Yes. Zoho Books and Sage offer free trials or starter plans, and Ember also offers a free plan for sole traders.
Conclusion
We have thoroughly discussed the essential information about the top 7 accounting platforms.
With so many possibilities, it’s critical to select accounting software that meets your demands, streamlines accounting for small businesses, and complies with legal regulations.
Every solution may help business owners manage their money more effectively. Having corporate accounting software that satisfies these requirements is essential to preventing expensive errors as the UK’s tax laws move towards digital reporting.
In the end, the correct small business accounting software aids in time savings, operational efficiency, and financial organization.
