Best small business accounting software in 2021

Accounting software is a smart, scalable solution for small businesses. But which provider is right for you? Browse our top seven picks below to find out

Our experts

We are a team of writers, experimenters and researchers providing you with the best advice with zero bias or partiality. This article was co-authored by:

It’s not hard to see how accounting software can help your business, however it can be tricky to work out which provider is the best fit for your business.

To an extent, this will always depend on what exactly your business does but, using our 20 years of small business experience, we’ve run the rule over the options out there . Our verdict is:

  • We'd confidently recommend QuickBooks as the best overall choice for UK small businesses. It’s an intuitive, modern platform with great value plans, regular deals and discounts, and some truly first-class tax planning features.
  • FreshBooks runs it incredibly close – boasting its own range of excellent value plans and a slick design that makes it easy to create ultra-professional attention-grabbing invoices and estimates.
  • If you're not looking to spend, then Zoho Books has the best free plan – though we'd recommend investing just a little to upgrade to one of the good value paid tiers.

To learn more about how the top contenders stack up in terms of cost, features, ease of use and customer support, just read on:

Accounting Software Deals

Don't miss out – we've spotted some excellent deals on our top picks for small business accounting software:

0 out of 0
Price From
Best For
Key Benefits
Free Trial

QuickBooks

FreshBooks

Zoho Books

Sage

Xero

FreeAgent

Ember

Free, or £12 per month (excl. VAT)

£12 per month (excl. VAT)

£12 per month (excl. VAT)

£19 per month (excl. VAT)

£39 per month (excl. VAT)

Tax planning

Invoice creation

Project tracking and a great free tier

Customer support

Business reporting

Limited companies

Expert assistance

  • Self-employed plan
  • Income tax estimate tool
  • Plans have no usage limits
  • Free trial available
  • First-class invoice/estimate creation
  • Colourful and intuitive UI
  • Designed for SMEs
  • Free trial available
  • 24/7 phone support
  • Will grow with your business
  • Perfect for less confident IT users
  • Slick design
  • Insightful reporting
  • 24/7 online support
  • Free trial available
  • Great for corporation tax filing
  • Free for Natwest/RBS business banking customers
  • Free trial available
  • Gives your business an accountant
  • Handles company incorporation
  • Optimise company payouts

We've taken a closer look at each of these top providers in the sections below:

QuickBooks

Best overall

4.7 out of 5
  • Bookkeeping
    5
  • Advanced Features
    4.5
  • Financial Reporting
    5

QuickBooks accounting software for small businesses

With over 4.5 million businesses around the world relying on its services, accounting software powerhouse QuickBooks must be doing something right. And, it's not hard to see why they're so popular – their plans are loaded with great features and they have some of the most transparent, affordable pricing around.

They're one of the few providers to offer a dedicated self-employed plan, which costs just £8 per month, and is one of the most affordable plans around. It's full of powerful functionality too, and saw QuickBooks claim top spot in our list of the best self-employed accounting software.

Small businesses though will want to go for Simple Start – which adds income tax estimates, phone support, and pay-enabled invoices – for just £12 per month for a single user.

The next tier up, Essentials (£20 a month) adds multi-currency support and bill and payment management, and increases the cap to three users. £30 a month gets you Plus – this tier offers more control over your budget, employee time, stock management, and project productivity, with a five user limit.

All plans come with award-winning support, an intuitive mobile app, and over 700 app integrations. And there isn’t a contract in sight.

0 out of 0
Plan
Cost
Features

Simple Start

Essentials

Plus

£12 per month (excl. VAT)

£20 per month (excl. VAT)

£30 per month (excl. VAT)

  • Prepare and submit VAT returns directly to HMRC
  • Send pay-enabled invoices
  • Create estimates and quotes
  • Manage bills
  • Accept and make payments in over 145 currencies
  • 3 users
  • Manage stock
  • Track employee time
  • 5 users

FreshBooks

Easiest to use

4 out of 5
  • Bookkeeping
    4
  • Advanced Features
    3.6
  • Financial Reporting
    4.4

FreshBooks accounting software for small businesses

FreshBooks is another great option for UK small businesses – it offers three feature-rich plans at affordable prices and boasts a slick UI that makes doing things like creating invoices and entering payments a breeze.

Its basic plan, Lite, starts at just £11 per month – one of the cheapest plans we came across. And, with unlimited invoices, expense entries, time tracking, and estimates, it’s also one of the most generous… though you’re limited to five billable clients only.

Upgrading to Plus (£19 per month) adds unlimited proposals, and allows you to automate recurring invoices and late payment reminders. It also extends your client limit to 50, though larger businesses will want to look at a Premium plan (£30 per month), which has a capacity of 500 billable clients.

You’ll also need to remember to keep an eye on any costs lurking below the surface. If you’re a sole trader, then FreshBooks is one of the cheaper options out there. However, adding additional team members costs £7 per person, per month – so we don’t recommend it for larger teams. FreshBooks’ more advanced payment features will also incur a fee of £15 per month.

0 out of 0
Plan
Cost
Features

Lite

Plus

Premium

£11 per month (excl. VAT)

£19 per month (excl. VAT)

£30 per month (excl. VAT)

  • Send unlimited invoices to up to 5 clients
  • MTD VAT return filing
  • Unlimited expenses
  • Send unlimited invoices to up to 50 clients
  • Invite your accountant
  • Bank reconciliation
  • Send unlimited invoices to up to 500 clients
  • Track project profitability
  • Accounts payable

Freshbooks is currently offering a 50% discount on your first three months of usage. You can also save get an extra discount by paying annually.

Zoho Books

Best for project tracking

Zoho Books accounting software for small businesses

With a CRM (customer relationship management) tool, email hosting, and project management solutions, Zoho has built a reputation on simple, user-friendly tools for businesses – and its accounting software doesn’t disappoint. There's even a high quality free Zoho Books plan that's perfectly respectable for small teams or single-person setups.

Zoho's free plan is only suitable for very small businesses as it doesn't offer important features like bank feeds, and only includes email support.

Naturally, the better features come with a price tag attached. Zoho Standard (£12 per month, for three users) allows you to track, reconcile, and budget with ease, from your smartphone or computer. You’ll also be able to stay on top of your projects and timesheets, and manage up to 5,000 invoices.

The next tier, Professional, costs £24 per month, for five users. This adds bills, multi-currency handling, reporting tags, purchase approval, and up to 10 workflow rules.

Zoho’s answer for more established businesses is Premium (£30 per month, for ten users). For the money, you’ll be able to track activity across multiple branches, create custom reports – and get a snazzy custom domain, too.

Adding extra users will set you back £2.50 per user, per month. Auto-scans also need to be purchased in bulk – 50 monthly scans costs £8 per month.

0 out of 0
Plan
Cost
Features

Free

Standard

Professional

Premium

£12 a month (excl. VAT)

£24 per month (excl. VAT)

£30 per month (excl. VAT)

  • Manage up to 1,000 invoices per year
  • MTD VAT filing
  • Expenses & mileage tracking
  • Manage up to 5,000 invoices
  • Automatically import transactions
  • Add recurring expenses
  • Bill management
  • Multi-currency handling
  • Retainer invoices
  • Track activity across multiple branches
  • Custom domain
  • Custom reports

Sage

Best for customer support

4 out of 5
  • Bookkeeping
    3.5
  • Advanced Features
    4.5
  • Financial Reporting
    4

Sage accounting software for small businesses

These days, Sage’s industry-leading software caters to a customer base of over six million. But go back to 1981, and Sage had just begun life in a basement, focusing solely on – you guessed it – accounting software. And, although Sage has outgrown its original digs, the company’s small business focus remains the same. So what do you get for your money?

Well, Sage’s most basic plan, Accounting Start (£12 per month) does all the basics. It supports one user, and allows you to create and send invoices, calculate and submit VAT, and automate bank reconciliation. Larger businesses can upgrade to Accounting Standard (£24 per month), which unlocks unlimited users, and adds cash flow forecasting and advanced reporting into the mix.

For SMEs looking to scale beyond that, Sage’s Accounting Plus (£30 per month) brings even more features to the table. You’ll get inventory management and support for multiple currencies included, and be able to streamline receipt input with Sage’s ‘AutoEntry’ feature.

You can add payroll to any plan for just £7 (excl. VAT) per month.


Accounting Start

£12 per month (excl. VAT)

Compare software

Accounting Standard

£24 per month (excl. VAT)

Compare software

Accounting Plus

£30 per month (excl. VAT)

Compare software

Xero

Best for business reporting

Xero accounting software for small businesses

With clean lines, aquatic colours, and a simple, intuitive design, Xero’s interface is as easy on the eye as it is to use. Its vibrant online dashboard is fully customisable, and effectively visualises your data to give you a direct, digestible overview of your business’ books.

£12 per month gets you the Starter plan, which includes VAT submissions, plus automatic CIS (Construction Industry Scheme) reports and calculations. Though handy, we’d recommend this plan only for the sole traders out there – you’re limited to entering five bills, and sending 20 invoices per month. 

Ambitious businesses will almost certainly want to upgrade to Xero’s Standard plan (£26 per month), which does away with its predecessor’s restrictive limits. Large businesses can shell out for Xero’s Premium plan (£33 per month), which adds multiple currency handling.

Features allowing you to manage staff pensions and payroll and track expenses are available as add-ons:

  • Xero Payroll (£1 per employee, per month)
  • Xero Expenses (£2.50 per user, per month)

All plans include 24/7 customer support, access for unlimited users, and integration with more than 800 third-party apps.

Starter

£12 per month (excl. VAT)

Compare software

Standard

£26 per month (excl. VAT)

Compare software

Premium

£33 per month (excl. VAT)

Compare software

FreeAgent

Best for limited companies

FreeAgent accounting software for small businesses

FreeAgent isn’t the cheapest software on this list – nor does it boast the most functions. But, when it comes to removing limits on your users, clients, projects, and features, FreeAgent is our top pick for small UK businesses. 

Unlike Xero (which limits your features), FreshBooks (which restricts the amount of billable clients you can support), and QuickBooks (which holds back its best features for the big spenders),

FreeAgent gives you everything for a single, fixed monthly fee, which depends on your business’ legal status. FreeAgent’s savvy software makes self-assessment simple for sole traders (£19.50 per month), and helps partnerships (£24 per month) with profit share calculation.

However, we most recommend FreeAgent for limited companies. Sure, you’ll pay a bit more (£29 a month), but its dividend vouchers and Corporation Tax filing are difficult to top.

All plans come with FreeAgent’s award-winning customer support.

Finally, you can get FreeAgent free if you're a Natwest/RBS business banking customer. However, you'll give up access to your data in return, so make sure you're comfortable with that if you're thinking of taking up this offer.

Sole Trader

£19 per month (excl. VAT)

Try it today

Partnership/LLP

£24 per month (excl. VAT)

Try it today

Limited Company

£29 per month (excl. VAT)

Try it today

FreeAgent is currently offering new customers 50% off their first six months, and you can get started with a free 30-day trial.

Ember

Best for expert assistance

Ember best small business accounting software screengrab

Ember is different to every other company on this list – it not only offers accounting software but also 24/7 access to an expert friendly accountant who can help you work out the best financial strategies for your business.

Naturally, you pay a bit more for this. Ember charges a flat fee of £39 per month plus £4 per month per employee on payroll (both excl. VAT). However, as it promises to save you the expense of hiring a dedicated accountant, this price is actually pretty reasonable, and Ember claims that its average user gets back 8.5x what they pay through tax savings.

In short, you not only get powerful accounting software (that can handle everything from invoicing to conducting transactions in multiple currencies), but also expert, personalised insight into tricky things like whether you should pay yourself through dividends or PAYE.

And it already has a growing army of fans – with an outstanding 4.8 rating from 50 Trustpilot reviews – and offers a 30-day free trial so you can see exactly how it can help your business.

£39 per month (excl. VAT)

Compare software

FAQs

What is the easiest accounting software for small business?

FreshBooks is the easiest accounting software to use, thanks to its simple interface and smooth user experience. However, we’d also recommend Quickbooks, which combines user-friendliness, powerful features and transparent, affordable pricing.

Is there free accounting software?

Yes, there is – Wave, QuickFile, and GnuCash all offer free accounting software for small businesses. However, there’s a reason you won’t see any of those suppliers on this list.

Free accounting software tends to impose hefty limits on features and functionality, and is rarely (if ever) a good solution for businesses looking to scale. We don’t recommend it overall, even for those just starting out.

For a detailed comparison of the options available, check out our guide to the best free accounting software for small businesses.

What does ‘cloud-based’ software mean?

These days, cloud-based accounting software is the standard. Rather than purchase the solution outright (or build it yourself), you’ll pay for the software on a monthly basis (just like your Netflix subscription).

Instead of downloading and installing software, you'll access it through your web browser or a mobile app, and your data will be stored by your accounting software provider ‘in the cloud’. This means you’ll save on the costs of hosting and securing your own data, and you'll be able to easily access your files from multiple devices.

Cloud-based software also lets you log in from anywhere with an internet connection, and collaborate in real time.

Alec Hawley
Back to Top