Best self-employed accounting software Self-employed, freelance, or a sole trader? Accounting software could really help your business – here’s our pick of the best. Written by Stephanie Lennox Updated on 14 July 2023 Our Research To recommend the best accounting software, our writers and researchers focused on the factors that matter most to small business owners – ease of use, features, design, scalability, and suitability for the UK taxation system. Written and reviewed by: Stephanie Lennox Writer Julia Watts Our independent reviews are funded in part by affiliate commissions, at no extra cost to our readers. Accounting software does so much more than just keep track of your basic financial comings and goings. You’re also able to manage your accounts on the go, create invoices, keep track of your cashflow, and easily handle your expenses – which are all crucial, particularly during our current economic climate and cost of living crisis.Our expert researchers determined that the best accounting software for self-employed individuals is QuickBooks, thanks to its intuitive interface and simple templates to help you process common tasks. They are also currently offering 90% off for six months, giving you a great value way to try the software.With so many options out there, it can be hard to know how they stack up against each other, and which is the right choice for your business. Whether you’re self-employed, freelance, or a sole trader – help is at hand. Read on for our reviews of the best accounting software to help you spend less time keeping track of your bills, and more time actually running your business. Best self-employed accounting software at a glance Don't miss out – we've spotted some excellent deals on accounting software that freelancers and sole traders can snap up:QuickBooks – 90% off for 6 monthsFreshBooks – 50% off for 3 monthsSage Business Cloud Accounting – from £12 per monthXero – from £10 per month exc VAT Swipe right to see more 0 out of 0 backward forward BEST OVERALL 90% OFF DEAL QuickBooks FreshBooks Xero Clear Books Zoho Books Price From £10 per month 90% off for 6 months Price From £12 per month 50% off for 3 months Price From £12 per month (excl. VAT) Price From £12.00/mo £6.00/mo *first 3 months (excl. VAT) Price From Free, or £12 per month (excl. VAT) Rating 4.7 Rating 4.0 Rating 4.6 Rating 4.2 Rating 4.0 Free Trial Free Trial Free Trial Free Trial Free Trial Compare accounting software and find the right deal for you Compare now Best self-employed accounting software: our top picks 1. QuickBooks - Best for doing your tax return 2. FreshBooks - Best for impressing your clients 3. Sage Business Cloud Accounting - Best for customer support 4. Xero - Best for a clean, user-friendly interface How does accounting software work? What types of businesses is accounting software suitable for? How we test accounting software for small UK businesses Conclusion: How to choose your self-employed accounting software What is accounting software?Accounting software is a computer program or application designed to manage and streamline financial processes within a business. It is used by companies of all sizes to record, process, and track financial transactions, generate financial statements, and perform other accounting-related tasks. According to Intuit, most business owners save around 8 hours a month on their accounts – even if you use free accounting software to get started.Accounting software automates many manual and time-consuming tasks involved in financial management, such as recording sales and purchases, managing accounts payable and receivable, payroll processing, inventory management, budgeting, and generating financial reports. Businesses that use accounting systems have five times more customers than businesses that don't, according to GoRemotely.It helps business owners maintain accurate and up-to-date financial records, improve efficiency, reduce errors, and obtain valuable insights into the financial health of their businesses. Best self-employed accounting software: our top picksWe’ve been helping small businesses for over two decades. In that time, we’ve carried out extensive research into the best accounting software, informed by our knowledge of the specific pain points and desires of SMEs. Our top picks for self-employed people are QuickBooks, Freshbooks, Sage Business Cloud Accounting, and Xero – and we've determined the best based on factors such as functionality, pricing, and customer service. Quickbooks – Best for doing your tax return 4.7 out of 5 Bookkeeping 5 Advanced Features 4.5 Financial Reporting 5 Try Quickbooks QuickBooks pros Extensive feature offering at a competitive price rate Enables users (on all tiers) to easily create cash-flow projections Minimises admin work by providing document scanning (receipts and bills) QuickBooks cons Accounts payable functionality unavailable on cheapest tier Inventory management restricted to highest tier Budget management tool restricted to highest tier Recommended plans:QuickBooks Self Employed: £10 per month exc VATQuickBooks Simple Start: £14 per month exc VATCurrently offering 90% off for 6 months!QuickBooks featuresQuickBooks is one of the big players when it comes to accounting software in the UK, and its unrivalled features for sole traders and freelancers makes it a very strong contender when it comes to the best self-employed accounting software.Where QuickBooks really stands out is its tax planning support. Unlike with some of the other options on this list, you can:Separate personal and business expensesTrack mileageAutomatically view income estimatesEasily get all the figures you need when it comes to submitting your self-assessment tax returnThese features come on top of a very capable business accounting package. Even the most basic plan comes with:Unlimited invoicingReport creation toolsBank account integrationThe ability to snap your receipts on the go, and have the data automatically extractedQuickBooks accounting dashboardIt’s good value too – the base self-employed plan has a standard cost of just £10 per month (exc VAT), making it one of the cheapest plans out there.This should be ideal for most self-employed people, but if you are registered for VAT, then you should upgrade to the Simple Start plan (£14 per month exc VAT), as this lets you easily prepare and submit your electronic VAT declarations. You even get SmartScan, a clever bit of error checking tech that will check whether any of your VAT codes are unusual (i.e. possibly wrong) or duplicates. Simple Start also lets you quickly create quotes and estimates, and supports Construction Industry Scheme (CIS) contractor and sub-contractor deductions.The only thing to really fault QuickBooks on is its support options. The £10 per month self-employed plan only offers online chat support, and while the hours for this are generous (7am to 10pm Monday to Friday and 8am to 8pm on weekends), it might not be ideal for some self-employed people. Of course, there are lots of resources available through the website, but in terms of actual one-to-one assistance, you might not be able to get help when you really need it.The £14 per month Simple Start plan adds phone support, but with similar conditions. This is available 8am to 12am Monday to Friday and 8am to 8pm on weekends, which is again generous, but not 24/7.QuickBooks pricing Swipe right to see more 0 out of 0 backward forward BEST VALUE Plan Self Employed Plan Simple Start Plan Essentials Plan Plus Plan Advanced Cost £10 per month (excl. VAT)90% off for 6 months Cost £14 per month (excl. VAT)90% off for 6 months Cost £24 per month (excl. VAT)90% off for 6 months Cost £34 per month (excl. VAT)90% off for 6 months Cost £70 per month (excl. VAT)90% off for 6 months VerdictFor most people, QuickBooks is the perfect self-employed accounting software, with a very strong base package elevated by specialised tax planning support for sole traders and freelancers. It’s reasonably priced, and has a strong track record, having been available in the UK since 2011. The only thing we’re less keen on is the slightly limited support on offer, but even this shouldn’t be much of a problem for most users. To learn more, check out our in-depth QuickBooks review. Freshbooks – Best for impressing your clients 4 out of 5 Bookkeeping 4 Advanced Features 3.6 Financial Reporting 4.4 Visit site FreshBooks pros Priced slightly cheaper than competitors Enables users (on all tiers) to track their billable hours and add them to invoices Provides inventory management on all tiers FreshBooks cons Does not provide any budgeting or cash-flow projection tools Client limit is only lifted on their third tier at £27 per month Accounts payable functionality only available from third tier at £27 per month Recommended planFreshBooks Lite (£12 a month exc VAT)FreshBooks featuresFreshBooks began life in Canada in 2003, but has recently made a strong push in the UK, including adding Making Tax Digital (MTD) VAT integration in 2020. It’s a strong overall package, but what we really like is its invoice and estimate creation tools.FreshBooks invoice creation featureWhile most accounting software offers this, it’s been a key priority for FreshBooks for years, and this focus really shows. There’s a wide range of colours available, and it’s easy to import your own graphics, meaning you can very quickly produce invoices and estimates that perfectly reflect the tone of your self-employed business.FreshBooks’ base plan, Lite (£12 a month exc VAT), also includes some really useful features for sole traders and freelancers. You’ll get:Unlimited time trackingUnlimited expensesMobile mileage trackingUnlimited estimatesReporting toolsBank account integrationThe ability to easily create VAT reports that can be submitted directly to HMRC with a clickThe real downside is the five client limit on the Lite plan. FreshBooks advises that this refers to “the number of both active and archived clients in your account”. However, “if you’re no longer billing or working with a client, you can delete them to free up spots for new clients”, and retain access to their invoices and information. You are also able to delete and undelete clients as you wish.How much this impacts you will, of course, depend on how many clients your business has – but it feels like a rather strict limit given the monthly cost. The other option is to upgrade to the Plus plan, which costs £22 per month (exc VAT) and limits you to 50 billable clients per month.In terms of support, FreshBooks does offer phone assistance alongside the resources on its website. However, this seems to operate on US business hours – meaning it’s only available from 1pm to 1am GMT – so make sure you bear this in mind when choosing the right self-employed accounting software for your business.FreshBooks pricing Swipe right to see more 0 out of 0 backward forward 90% OFF DEAL Plan Lite Plan Plus Plan Premium Cost £12 per month 50% off for 3 months Cost £22 per month 50% off for 3 months Cost £35 per month 50% off for 3 months VerdictFreshbooks offers some of the best invoice and estimate creation tools around, and all its plans include advanced features like time tracking, mileage tracking, and MTD VAT support. As long as you can stay within the five billable clients per month limit (or can afford to upgrade), then it could be the perfect self-employed accounting software for your business. To learn more, check out our in-depth FreshBooks review, or find out: how does QuickBooks measure up to Freshbooks? 3. Sage Business Cloud Accounting – Best for customer service 4 out of 5 Bookkeeping 3.5 Advanced Features 4.5 Financial Reporting 4 Visit site Sage pros Provides users with a cash-flow projection tool Provides a 24/7 customer service phone line Does not set a client or invoice limit on lowest tier Sage cons Does not provide a project accounting functionality Users on cheapest tier cannot enable their accountant to use the software Inventory management restricted to highest plan Recommended planAccounting Start (£12 per month exc VAT)If you’re less confident with accounting software, then Sage Business Cloud Accounting is a strong option. 53% of accountants use cloud-based technology to enhance project management functions and improve communications, according to Fundera. Everything is arranged clearly and logically, plus there’s 24/7 support via phone and live chat, so there’s someone there to help whenever you need it.Sage's accounting dashboardSage featuresWith Accounting Start, you get a solid basic package. This lets you:Create and send invoicesTrack what you’re owedAutomatically reconcile your bank accountsCreate and submit MTD VAT reports to HMRCHowever, if you need to work out Construction Industry Scheme (CIS) deductions, then you’ll require the £24 per month (exc VAT) Accounting Standard plan. This also grants you the ability to:Run advanced reportsSend quotes and estimatesForecast cashflowManage purchase invoicesAnd that’s it, unfortunately. No matter which plan you pick, you won’t get any advanced features like mileage tracking, and the ability to import expense receipts by snapping them on your phone is only available as an optional extra.Where Sage really shines, though, is its customer support. On all plans, you get 24/7 help via both phone and live chat, as well as a comprehensive suite of instructional videos and online guides.Sage pricingSage’s base package, Accounting Start, costs £12 per month (exc VAT) and includes tools to calculate and submit VAT returns. When it comes to self-employed accounting software, this plan is probably more suited to well-established freelance/sole trader businesses. Swipe right to see more 0 out of 0 backward forward Plan Accounting Start Plan Accounting Standard Plan Accounting Plus Cost £14 per month (plus VAT) Cost £28 per month (plus VAT) Cost £36 per month (plus VAT) VerdictIf you’re looking for basic accounting software and support to guide you every step of the way, then Sage Business Cloud Accounting could well be your best option for self-employed accounting software. The 24/7 support on offer is unrivalled, but for most freelancers and sole traders, the feature list is a bit limited for the price. To learn more, check out our in-depth Sage Business Cloud Accounting review. Xero – Best for a clean, user-friendly interface 4.6 out of 5 Bookkeeping 5 Price 3.8 Financial Reporting 5 Compare Xero pros Extensive feature offering at a competitive price rate Provides an easy-to-use budget creator on all pricing tiers Enables users on all tiers to easily record fixed assets Xero cons Users on lowest tier can only input up to 5 bills per month, severely limiting the accounts payable function for these users Project accounting functionality costs an additional monthly fee CIS features cost an additional monthly fee Recommended planXero Starter (£12 per month exc VAT)Xero featuresXero calls itself “beautiful accounting” – and here at Startups, we’re big fans of its elegant interface. Everything is laid out clearly, and the white, blue, grey, and light green pastel colours it uses are calming. This is important, given that you’ll be checking your accounting software a lot as you run your self-employed business.Xero's accounting dashboardCrucially, there’s substance to go with that style. The basic £12 per month (exc VAT) starter plan lets you:Create invoices and quotesEnter billsReconcile bank transactionsSubmit VAT returns to HMRCAutomatically calculate Construction Industry Scheme (CIS) deductionsCapture bills and receipts using HubdocHowever, this plan does also come with some strict usage limits – indeed, you can only send 20 invoices and quotes and enter five bills per month. Go above this, and you’ll need to start paying £26 per month (exc VAT) for the Standard plan. It’s a steep increase, especially given that the Standard plan offers no other extra features.It’s also unclear what Xero’s promise of “24/7 support” actually means. Its website is full of helpful guides and instructional videos, but things are much less clear-cut when it comes to getting help from an actual human. Xero has no support number you can call, and no live chat option either. Instead, you send a message and then wait for them to get back to you. It’s hard to tell how long this takes, and there’s at least one disgruntled customer on the Xero forums complaining about waiting several hours for a response to their query.Xero pricing Swipe right to see more 0 out of 0 backward forward Plan Starter Plan Standard Plan Premium Cost £12 per month (plus VAT) Cost £26 per month (plus VAT) Cost £33 per month (plus VAT) VerdictProvided you can stay within the usage limits, Xero is the natural choice for anyone who wants sleek, stylish self-employed accounting software. With those limits offering a very clear incentive to upgrade, Xero does offer an impressive range of features in its basic plan – making this plan perfect for any small-scale sole traders that need to work out VAT or CIS deductions. The limited support on offer, however, means that those less confident with accounting software might want to look elsewhere. How does accounting software work?Accounting software is designed to be user-friendly, with intuitive interfaces and navigation. This makes it accessible to users with varying levels of accounting knowledge. It simplifies financial tasks, automates calculations, improves reporting accuracy, facilitates integration with other systems, enhances security, and enables businesses to efficiently manage their finances and make better-informed decisions.Many software providers offer customer support and training resources to assist users in getting the most out of their accounting software.You can also rest assured that while managing all these large financial processes, accounting software also offers features like user access controls, data encryption, and regular backups to safeguard sensitive financial data. What types of businesses is accounting software suitable for?Accounting software is suitable for a wide range of businesses, regardless of their size or industry. It can be utilised by small startups, freelancers, sole proprietors, mid-sized companies, and large enterprises. The software's flexibility allows it to adapt to various business models and structures. It can handle different types of transactions, such as sales, purchases, expenses, payroll, and inventory management. This makes it applicable to businesses involved in retail, e-commerce, professional services, consulting, hospitality, construction, and many other sectors.Accounting software provides benefits to businesses with different levels of financial expertise. The software's user-friendly interfaces and customisable features make it accessible to users with varying levels of accounting knowledge, and tailored to meet the specific needs of many different industries. How we test accounting software for UK small businessesAt Startups, it's important to us that the product recommendations we make to small UK businesses are useful, accurate, and based on thorough product testing.We tested ten market-leading accounting software platforms across four main categories of investigation and 24 subcategories – all in all, we covered 111 areas of investigation. Next, we gave a ‘relevance weighting' to the final product category scores - this ensures the products' final ratings perfectly reflect the specific needs and requirements of Startups readers.Our main testing categories for accounting software are:Help and Support: Help and support refer to the assistance and resources available to users when they encounter issues or need guidance while using the accounting software.Pricing: Pricing refers to the cost associated with using the accounting software. It includes factors such as licensing fees and subscription plans.Main functions: This represents the key areas of accounting that the software focuses on. This includes functionalities such as financial statement preparation, income and expense tracking, and managing vendor and customer accounts.Software Functionality: Refers to the software capabilities such as integrations, mobile capability, and confirming any additional features outside of accounting.The Startups product testing process Conclusion: How to choose your self-employed accounting softwareChoosing the right self-employed accounting software for your business is just like choosing anything else – you need to work out what you need most, and what you can live without.If, for example, you’re VAT registered, then it’s going to make a real difference if you choose software that lets you directly submit VAT returns to HMRC. And if you know you’ll need to calculate Construction Industry Scheme (CIS) deductions, then look for a plan that offers this.More generally, think carefully about how your business works. If the plan you’re considering has strict usage limits, then work out whether you’re likely to be able to stay within them. You should also think about how much you’ll actually use advanced features like time tracking, or being able to submit your expenses just by snapping a receipt with your smartphone.Just as importantly, think about how you work. If you’re an IT whizz that loves learning new software, then you probably don’t need to worry too much about when and how in-person support is available. If you’re less confident though, it could be worth paying a bit more to ensure there’s always someone to call if/when you run into problems.Finally, if you really can’t decide, then check whether a free trial is available. At the time of writing, QuickBooks, Sage, Xero, and Freshbooks all offer 30-day free trials, so you can take them for a spin and see if they’re the right self-employed accounting software for you. If you do do this though, make sure you know what features would actually be on offer in your chosen plan – the free trial generally gives you access to everything, and there’s no point diving into features that are only available on plans you can’t afford.This time and effort is worth it, though. Whether you’re self-employed, a freelancer, or a sole trader, finding the right accounting software can make running your business quicker, easier, and less stressful – leaving you more time to do what you’re actually good at.Good luck! 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. Share this post facebook twitter linkedin Tags Topic spotlight Written by: Stephanie Lennox Writer Stephanie Lennox is the resident funding & finance expert at Startups: A successful startup founder in her own right, 2x bestselling author and business strategist, she covers everything from business grants and loans to venture capital and angel investing. With over 11 years of hands-on experience in the startup industry, Stephanie is passionate about how business owners can not only survive but thrive in the face of turbulent financial times and economic crises. With a background in media, publishing, finance and sales psychology, and an education at Oxford University, Stephanie has been featured on all things 'entrepreneur' in such prominent media outlets as The Bookseller, The Guardian, TimeOut, The Southbank Centre and ITV News, as well as several other national publications.