Startups.co.uk is reader supported – we may earn a commission from our recommendations, at no extra cost to you and without impacting our editorial impartiality.
Finding the accounting software that’s the best fit for your business can feel like a tricky task. Choosing the wrong software for your finances and bookkeeping could seriously hamstring your operation, so you need to be confident before investing your time and money.
That’s why our dedicated research team worked rigorously to determine the best accounting software for small businesses. Through in-depth analysis and actual, hands-on user testing, we determined Zoho Books to be the number one pick. It’s affordable, feature-filled, and easy to use.
That said, you might find that a different platform has niche tools and specialist capabilities that will benefit your particular business. Check out our breakdown of all the heavy hitters below.
Zoho Books: best for managing your inventory and sales, and for those who need an on-the-go software for real-time financial management
QuickBooks: best if you need sophisticated financial insights and advanced customisation
FreeAgent: best choice for budget-conscious businesses seeking simple yet effective tax forecasting and scenario prediction tools
Xero: best for more experienced accountants and established businesses who need more than just the basics
Sage: best for businesses seeking tailored financial solutions and strong brand representation
FreshBooks: best for new businesses who need affordable software with the reassurance of all-hours support
Clear Books: best if you need MTD-compliant tax support for VAT returns, including a wide range of tax types
| FEATURED PROVIDER  | BEST OVERALL  |  |  |  |  |  |
| Zoho Books | FreeAgent | Sage | FreshBooks | Clear Books | ||
| Price From | Price From Free | Price From £5 per month for the first six months (excl. VAT) | Price From | Price From £15 per month (excl. VAT) First three months free | Price From £15 per month | Price From
£6.75 per month for the first three months (excl. VAT) |
| Rating 4.5 | Rating 4.8 | Rating 4.5 | Rating 4.3 | Rating 4.2 | Rating 4.1 | Rating 4.0 |
| BEST FOR Best if you need sophisticated financial insights and advanced customisation | BEST FOR Best for managing your inventory and sales, and for those who need an on-the-go software for real-time financial management | BEST FOR Best choice for budget-conscious businesses seeking simple yet effective tax forecasting and scenario prediction tools | BEST FOR Best for more experienced accountants and established businesses who need more than just the basics | BEST FOR Best for businesses seeking tailored financial solutions and strong brand representation | BEST FOR Best for new businesses who need affordable software with the reassurance of all-hours support | BEST FOR Best if you need MTD-compliant tax support for VAT returns, including a wide range of tax types |
| Free Trial | Free Trial | Free Trial | Free Trial | Free Trial | Free Trial | Free Trial |
| Visit Quickbooks | Compare Deals | Compare deals | Visit Xero | Compare Deals | Compare Deals | Compare Deals |
This article will cover:
1. Zoho Books
Best for managing your inventory and sales, and for those who need an on-the-go software for real-time financial management
- Starting price from: free
- Free trial: 14 days
- Highly effective importing and exporting capabilities
- Excellent free plan for solopreneurs and micro-businesses
- Mobile app for real-time financial management
Why might Zoho Books be right for my business?
What Zoho Books does best is combine helpful transaction documentation with seamless inventory tracking—as well as a suite of other helpful tools—to help your business run like clockwork. It even has a mobile app for real-time financial tracking on the move.
We particularly appreciated Zoho Books modern and easy-to-use interface. Source: Startups.co.uk
When we tested it, the modern design of the platform immediately stood out to us, making it not only a pleasure to use, but the most-user friendly accounting software we tested. Everything is so well signposted, so you shouldn’t find yourself hunting around for anything. The intuitiveness of the platform means you’ll feel confident when completing frequent, day-to-day tasks like managing quotes and invoices.
The dashboard feels tailored to small businesses, and can offer quick insights into key information. Source: Startups.co.uk
The dashboard is made specifically with small businesses in mind, giving you critical insights into your cash flow and payments at just a glance. The software also fits neatly into the wider Zoho ecosystem, so if you’re already using Zoho products for your business this one is a no-brainer.
What could be improved?
- The timer was a bit fiddly, and we didn’t like that you couldn’t create a new project to assign it to until stopping the timer.
- The reminder emails stood out as old fashioned, and we didn’t like that you could only add an image via URL.
- Zoho Books only offers limited hours of support – live chat and phone support is only available weekdays from 9am until 6pm. Xero, by comparison, provides 24/7 assistance.
- A more serious accountant might want a more complex bit of software – if that’s you, jump down to check out our Xero review instead.
How much does Zoho Books cost?
| | | | |
| Plan Free | Plan Standard | Plan Professional | Plan Premium |
| Cost Free | Cost
£10 per month (excl. VAT) | Cost
£20 per month (excl. VAT) | Cost
£25 per month (excl. VAT) |
What’s great about Zoho Books is that it provides a wide range of plans that support scalability. You can get started on the basic free plan, but upgrade to the higher levels if you need them. Just keep in mind there’s a £2 charge to add any additional users outside the limit in your plan.
- You want a beginner friendly software that’s simple to use
- You need a range of tools to support your business, especially inventory tracking
- You’re looking to get started on a free plan
- You’re planning on implementing non-Zoho integrations
- You want support outside of standard business hours
What our Reviews Writer thought
I found Zoho Books really easy to use, and was particularly impressed by how fast and simple it was to turn a quote into an invoice, and then send it off to the client. Sending payment reminders was just as straightforward. I can see how Zoho Books could really streamline your workflow!
2. QuickBooks
Best if you need sophisticated financial insights and advanced customisation
- Starting price from: £10 (self assessment only)
- Free trial: 30 days
- Automatically flags mismatched balances
- Cash flow projection tools to help with your financial visibility
- Custom reports and templates tailored to your business’s needs
Why is QuickBooks right for my business?
If you need to take a look at your company’s finances through a magnifying glass, QuickBooks can get the job done with powerful tools like cash flow projections and in-depth reporting. It also has plenty of extra features that we liked, including its ability to automatically flag mismatched balances.
QuickBooks’ cash flow projection tools stood out as a highlight during our testing. Source: Startups.co.uk
We really loved being able to create and customise reports and templates, which can be modified to fit your business’s specific needs. You can also customise the dashboard to your liking, so you get a lot of control over your workflow with QuickBooks.
You should consider QuickBooks if your business needs customisable reporting. Source: Startups.co.uk
When we tested it, we appreciated how well laid out and logical the interface was. Everything felt natural, including quickly converting an estimate into an invoice, and sending out payment reminders straight from the overdue section.
What could be improved?
- The lack of built-in time tracking for projects, or billable hours, is a big miss for us (you need to connect QuickBooks Time, which costs extra). If you consider this a must have, check out Zoho Books instead, as it does have this feature.
- We found the initial learning curve a bit steeper than we anticipated, whereas Zoho Books and FreshBooks were much simpler out of the gate.
How much does QuickBooks cost?
| | | | | |
| Plan Sole Trader | Plan Simple Start | Plan Essentials | Plan Plus | Plan Advanced |
| Cost Monthly:
£1 per month for seven months (excl. VAT) Annually:
| Cost Monthly:
£1.60 per month for seven months (excl. VAT) Annually:
| Cost Monthly:
£3.30 per month for seven months (excl. VAT) Annually:
| Cost Monthly:
£4.70 per month for seven months (excl. VAT) Annually:
| Cost Monthly:
£11.50 per month for seven months (excl. VAT) Annually:
|
| Best suited for: Sole traders and single property owners are who registered for VAT | Best suited for: Sole traders and small business owners who are managing income tax and VAT | Best suited for: Small businesses that are working with suppliers | Best suited for: Small businesses that are managing projects and inventories of stock | Best suited for: Businesses that need more sophisticated support like custom permissions and tailored insights |
| Features
| Features
| Features
| Features
| Features
|
QuickBooks is a fairly priced platform. If you opt for the Sole Trader tier, you can currently get started for just £1 per month for your first six months, making it a very low-cost option if you just want to get a self-assessment done.
- You need cash flow projection tools to help you budget effectively
- You need software that provides extensive and customised reporting
- You already have experience with accounting software and setting up workflows
- You need to get up and running quickly with a beginner friendly software
- You need time tracking functionality
“The platform is laid out in a way that makes sense, e.g., finding Bills under Expenses.”
“Converting estimates to invoices was really easy.”
“They are good at giving tooltips along the way.”
3. FreeAgent
Best choice for budget-conscious businesses seeking simple yet effective tax forecasting and scenario prediction tools
- Starting price from: £10 per month
- Free trial: 30 days
- The only software we tested that gives you built-in tax forecasting and planning tools at no extra cost
- Helpful cash flow alerts about potential surpluses and shortfalls
- Free plan available with certain qualifying banks
Why is FreeAgent right for my business?
If you’re looking for great financial planning tools without breaking the bank, FreeAgent is great value for money. Its tax timeline features and scenario prediction tools make staying on top of your business’s financial health an easy job, and it comes at a competitive cost to boot.
We appreciated FreeAgent’s clear layout. Source: Startups.co.uk
The cash flow alerts keep you updated about potential surpluses and shortfalls, while another major highlight for us was the timeline feature for invoicing, which made everything extremely clear and easy to follow. The detailed end-of-year reports can also really help you get a clear view of your finances, and help you streamline your operation going forward.
You can create custom invoices with FreeAgent. Source: Startups.co.uk
Overall, we felt that FreeAgent strikes a good balance between simplicity and functionality. A platform like Xero, for example, is geared towards more experienced users, but with FreeAgent, you get a beginner friendly option that still provides some serious business management features.
What could be improved?
- While we did like the navigation and layout, unfortunately we did come across a couple of aspects that were not quite as user-friendly: the platform uses unclear terminology in places, and certain sections, like payment reminders, were a little tricky to find.
- We were frustrated to find that with FreeAgent, in order to upload existing invoices from our computer, we needed to do this with an add-on integration. Whereas with many other providers you can do this easily through the platform itself.
How much does FreeAgent cost?
| | | | |
| Plan Landlord | Plan Sole Trader | Plan Partnership/LLP | Plan Limited Company |
| Cost
£5 per month for the first six months (excl. VAT) | Cost
£9.50 per month for the first six months (excl. VAT) | Cost
£13.50 per month for the first six month (excl. VAT) | Cost
£16.50 per month (excl. VAT) |
While its monthly fees aren’t quite as low as QuickBooks’ or Zoho Books’, FreeAgent still represents very good value for money. With a starting price of just £10 per month and no hidden fees, we think this is a pretty good deal.
- You want forecasting tools at a competitive price
- You need strong support for tax preparation
- You want a low-cost starter plan
- Having well designed help and support is a top priority
- You want to assign multiple delivery addresses to a customer to streamline your operations
- You prefer your software to save account codes for faster data entry
“I was quite a big fan, I thought the layout was quite clear.”
“It definitely felt like it understood its audience—maybe novice accountants, freelancers, or sole traders—so it seems to fulfill what it’s aiming for pretty well.”
“It notifies you within the main dashboard—like your tax timeline—of what’s expected and when it’s due. Unlike other platforms, it really felt trustworthy in keeping you on track.”
4. Xero
Best for more experienced accountants and established businesses who need more than just the basics
- Starting price from: £16 per month
- Free trial: 30 days
- Your clients can securely view and interact with their financial data through the Xero Portal
- Track the depreciation and amortisation of your fixed assets over time
- Connect with over 1000 possible integrations
Why is Xero right for my business?
If you’re a slightly more established business with a long-term client base, and you’re processing consistent billing, Xero will likely be the software you’re searching for. Xero combines sophisticated finance tools with a secure client portal to make sure you’re covered long term.
You can customise Xero’s dashboard to display the key information you need on the main screen. Source: Startups.co.uk
If you’re also having to process a high number of expense claims for your business or your clients, this is another area where Xero shines. It provides a clear section for uploading your receipt images and inputting mileage for travel claims, and you can assign the expenses to specific clients.
Xero is complex, but it offers a lot of functionality. Source: Startups.co.uk.
We found Xero to be a serious piece of software overall, with impressive functionality. It’s not for beginners, though, as there’s a pretty steep learning curve. We feel it’s geared towards accountants who deal with complex workflows and need the software to integrate into a much wider ecosystem. Well, Xero has you covered there, as it has over 1,000 possible integrations.
What could be improved?
- During our testing, we found Xero’s interface to be a bit old-fashioned and complicated, especially compared to slick, modern competitors like Zoho Books.
- Xero is the only provider on this list that makes you sign a contract (a one-month minimum term)
- The overwhelming dashboard stood out as particularly clunky.
- If you’ve never used accounting software, you’ll most likely be frustrated by Xero, and FreshBooks will be a much better fit. However, seasoned accountants may feel that its advanced functionality and sophisticated tools trump any usability issues.
How much does Xero cost?
| | | | |
| Plan Ignite | Plan Grow | Plan Comprehensive | Plan Ultimate |
| Cost | Cost | Cost | Cost |
Xero’s not cheap, and you need to be especially mindful of the additional per user fees. It costs £2.50 for each additional user, so if you need to get a lot of your staff set up with Xero, this could really add up. It’s also the only platform on this roundup to charge hidden costs for exceeding the bill and user limits on each plan.
- You’re an experienced accounting professional who needs advanced software
- You have a high turnover, and need to manage frequent billing
- You need a secure client portal for your customer base to use
- You’re an accounting novice who needs user-friendly software
- You want a modern, slick interface
- You need basic workflows for simple tasks
What our Reviews Writer thought
The learning curve with Xero is pretty steep—this definitely isn’t ‘baby’s first accounting software’—it definitely feels geared towards experienced users, but there’s a lot here that an accountant can sink their teeth into.
5. Sage
Best for businesses seeking tailored financial solutions and strong brand representation
- Starting price from: £15 per month
- Free trial: 30 days
- Ability to create custom reports that are tailored to your needs
- Customisable themes and logos to establish a strong brand identity
- Fully GDPR and PCI compliant ensuring top-tier security and regulatory assurance
Why is Sage right for my business?
If you’re looking to establish your identity as a brand, Sage can help by providing branding tools like tailored themes and logos to really help you stand out. You can customise the documents you’ll be sending out to clients like invoices and reports with your logo, and change themes and fonts. Sage’s abilities are more than just skin deep, though, as you also get customisable reporting and seamless integrations with the wider Sage ecosystem to help streamline your operations.
Sage provides customisable themes and logos, allowing you to establish strong brand authority. Source: Startups.co.uk
During our testing, the invoicing and quoting workflows really leapt out as modern and intuitive – we especially liked the invoice templates, which we could customise to our liking. We feel that both product and service-based businesses could benefit from using Sage, thanks to its slick invoice system.
Sage impressed us with its modern, visually appealing interface. Source: Startups.co.uk
You also get a lot of control with Sage—the customisable profit and loss reports are a key example—so if you’re looking for both insight and control over your finances, this is going to be a serious contender for you.
What could be improved?
- Aside from a few minor usability issues (like confusing naming conventions, such as an unclear name for expense forms) the main points of concern we had about Sage was the platform’s inability to automate payment reminders.
- We also noted the lack of any function for bulk importing contacts (unlike Quickbooks, which can do it via CSV), or bulk uploading expenses (Xero can do this, making it more suitable for managing high transaction volumes).
How much does Sage cost?
| |  | |
| Plan Accounting Start | Plan Accounting Standard | Plan Accounting Plus |
| Cost £15 per month (excl. VAT) First three months free | Cost £30 per month (excl. VAT) First three months free | Cost £59 per month (excl. VAT) First three months free |
Sage, overall, represents very decent value for money. It might not be the absolute cheapest option possible, but you get some bang for your buck with its customisable reports and features, and there are no hidden fees or additional costs to fret about.
- You want to establish a strong brand identity through customisable themes
- You need to seamlessly connect payroll integrations into your workflow
- You want to create custom financial reports tailored to your specific needs
- You want to rapidly upload a large amount of contacts and customers
- You frequently upload expenses in bulk
- You want to automate payment reminders and client follow-ups
What our Reviews Writer thought
One thing I really liked about Sage was that, when you send a quote, you get a timeline bar that shows you what stage of the timeline your invoice is currently at. I can see that this could be really helpful for small business owners to help them easily track what’s happening!
6. FreshBooks
Best for new businesses who need affordable software with the reassurance of all-hours support
- Starting price from: £15 per month
- Free trial: 30 days (if another business is added, this gets another 30 day free trial)
- Get support at any hour from the 24/7 customer support chatbot
- Precise Time Tracking for billable hours
- Intuitive, user-friendly interface
Why is FreshBooks right for my business?
FreshBooks is an affordable option for fledgling businesses that are only just getting going, and need reliable software at a competitive price. FreshBooks also provides a chatbot that you can access at any time of day or night, which could be really helpful for new businesses that need a lot of support.
We really liked how well organised the vertical navigation bar was on FreshBooks. Source: Startups.co.uk
Newer, inexperienced businesses (as well as sole traders) will also benefit from the user-friendly nature of FreshBooks’ interface. We liked how well organised the navigation bar is, with all the features clearly signposted, giving us quick and painless access to any essential tool we needed.
You can use FreshBooks’ precise time tracking to convert billable hours into invoices. Source: Startups.co.uk
While it might not have a massively sophisticated suite of features, FreshBooks does the basics you need it to, and unlike some of its competitors, it does also provide precise time tracking for billable hours. You can turn these into invoices directly from the projects folder.
What could be improved?
- There were a few niggles around usability, for example, the currency settings were giving us a headache – even when we updated them in the main settings, it would revert back to different currencies on our quotes and invoices.
- We felt the messaging function needed improvement, and we were concerned clients may be put off using it, as it requires both parties to make it work.
- While this is a good, low-cost system for new users, it lacks the advanced tools needed by a more serious outfit. It lacks the customisability of Sage’s reporting, there’s no mobile app or client portal like Xero’s, and QuickBooks is a better choice for budgeting and forecasting tools.
How much does FreshBooks cost?
| | | |
| Plan Lite | Plan Plus | Plan Premium |
| Cost £15 per month Or £162 per year | Cost £25 per month Or £270 yearly | Cost £35 per month Or £378 per year |
FreshBooks, when compared to competitors, has a pretty fair cost for its plans. There’s a big additional cost to keep in mind though: it charges an eye-watering £8 per additional team member. So if you’re looking to equip a team, another provider might make more sense.
- You’re a sole trader or new business that needs the basics at an affordable price
- You need the reassurance of all-hours help and support via a chatbot
- You need time tracking so you can accurately invoice clients
- You want a comprehensive mobile app to manage your financial data on the move
- You want advanced budgeting and forecasting tools
- You need sophisticated features, like multi-currency invoicing
What our Reviews Writer thought
What stood out to me about FreshBooks was how refreshingly easy to use and simple the interface is. I can see this would be great for sole traders who don’t have experience with this type of software.
7. Clear Books
Best if you need MTD-compliant tax support for VAT returns, including a wide range of tax types
- Starting price from: £13.50 per month
- Free trial: 30 days
- Well designed search function enables easy access to important information
- Efficient and easy customisation, such as quote creation
- Easily create new projects with helpful pop-up feature
Why is Clear Books right for my business?
If your number one priority is simplifying complicated tax calculations, being able to handle a range of different tax types, and being fully equipped to submit tax returns though the Making Tax Digital initiative, then Clear Books is worthy of your attention.
You can customise ClearBooks’ dashboard so it only shows the key information you need. Source: Startups.co.uk
To this end, the standout feature for us was the Tax Projection tool, which’ll give you a boost in confidence that all your upcoming payments are compliant with HMRC regulations. Outside of its tax capabilities, we also really liked the highly intuitive search function: we were able to find important information really efficiently.
We felt that ClearBooks is a good fit for small businesses looking for a simple accounting software. Source: Startups.co.uk
Convenience is definitely a watchword with Clear Books, and we also really enjoyed the pop-up approach to project creation, which we thought gave the platform a cutting-edge feel. Routine aspects of the software, such as filling out quotes and invoices, were also really simple making your daily tasks really manageable.
What could be improved?
- There are some usability issues: we felt the naming of different folders could have been much clearer, as it took us a while to find payment reminders.
- Our biggest concern about Clear Books was the very steep learning curve, and slightly frustrating onboarding process.
How much does Clear Books cost?
| | | |
| Plan Small | Plan Medium | Plan Large |
| Cost
£6.75 per month for the first three months | Cost
£14.50 per month for the first 3 months (excl. VAT) | Cost
£18 per month for the first six months |
Clear Books offers decent value for money, and with an entry level plan starting from just £13.50 per month, it provides a great low-cost option for being fully MTD compliant.
- You want to submit VAT returns through Making Tax Digital
- You want to be capable of handling a range of different tax types
- You want a fast and modern software platform
- You want a fast onboarding process with a quick learning curve
- You want 24/7 help and support
- You need cash flow projection tools to help you forecast and plan effectively
“I liked the look of it for one. I think it looks more modern than the other platforms and it was generally pretty easy to follow for the most part.”
“The dashboard is really clean. The accounts receivable end of it is really straightforward, so it’s really easy to find out who owes you money and turn quotes into invoices.”
“I liked that there was an account where I could see how much money I had in the bank so I could pay an expense. It showed how the platform operates in running a business.”
Buying guide: How to choose the right accounting software for your small business
Before making a decision on the accounting software you’ll be using, here are the top 10 factors you should be considering:
1. Pricing: make sure what you’re paying for makes sense for your business. There’s no point going for the cheapest option available if it doesn’t have the features that are vital to your business model.
2. Scalability: you’ll need software that can support your business as it grows. Make sure your chosen plan aligns with your financial goals, and there are more advanced plans you can upgrade to if needed in future.
3. Bookkeeping: efficient bookkeeping is the central function of accounting software. Look for products that simplify the recording and categorisation of transactions.
4. Accounts payable: managing payments is crucial for SMEs. Look for features that streamline invoice processing, support timely payments, and provide insights into cash flow.
5. Accounts receivable: you’ll need software that allows smooth invoicing, helps track customer payments, and provides reminders for overdue invoices.
6. Financial reporting: choose software that offers a range of customisable reports. Access to real-time insights will help successful strategic financial planning.
7. Integrations: seamless integration with banking, payment gateways, and CRM systems enhances efficiency as you can share relevant information across multiple systems.
8. Usability: you’ll want a modern system with a slick, well-designed interface. Poorly-designed systems can slow your operation down, and possibly even result in admin errors.
9. Mobile capabilities: a user-friendly app lets you access key financial information and perform essential tasks anywhere; essential for SME owners on the move.
10. Help and support: live chat, forums, and phone or email support help you and your team to more quickly find solutions to software issues or queries.
Now you know what to look out for in a good accounting software, we’d recommend using our free cost comparison tool to help you find one that’s the best fit for your business’s budget.
How we test accounting software for UK small businesses
Being able to accurately and efficiently manage your finances is absolutely critical to the success of a UK SME, so we take our role very seriously.
Our testing and analysis is a rigorous process. We combined data driven industry research with 57 hours of actual, hands-on testing.
Our in-house researchers explored a total of 1,512 areas of investigation spread across the six categories we determined as the most important to good accounting software.
Those six categories were:
Core accounting: how well does the software handle the key functions of accounting software, including invoicing, tax preparation and financial transactions?
Financial planning and visibility: how well does the software help you get a clear and helpful understanding of your company’s financial health?
Operational efficiency: how well does the platform integrate with other products, and how customisable is the workflow?
Help and support: what types of support are available, what are the contact hours, and what security measures are in place?
Pricing: how much do the monthly fees cost, and are there any hidden or setup costs?
Usability: how easy is the software to use?
Startups.co.uk is reader-supported. If you make a purchase through the links on our site, we may earn a commission from the retailers of the products we have reviewed. This helps Startups.co.uk to provide free reviews for our readers. It has no additional cost to you, and never affects the editorial independence of our reviews.
