Top 7 Accounting Software For Small Businesses UK 2023

The lack of cash management and maintaining proper financial records has been plaguing small businesses across the globe, and the UK is no different. It is one of the primary reasons behind the failure of most companies as they fail to keep track of their cash and financial performance. Since bookkeeping and accounting require significant effort as well as attention, many small and medium scale business owners find it challenging to cope with this along with their usual commercial activities.

Accounting software is a boon in this scenario where business owners can successfully focus on their business objectives while software automates their financial records. The accounting software market is growing consistently. HMRC’s MTD accelerated growth. We only see this growing in the future as HMRC intends to digitise all record-keeping and customers are enjoying the benefits of cloud computing.

In this article, we will help you to understand the benefits of accounting software, the various options that you can opt from, and the pros and cons of each of them in a business scenario. So, let us dive deeper into this impressive vertical without any further delay!

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What is Accounting Software?

Accounting software is essentially a computer program that assists in recording and reporting a firm’s financial transactions. These days, most of the software are cloud-based.

For a business with limited human resources, bookkeeping is more of a chore as it is often related to historical data, especially when the owner should be more concerned about the day-to-day business operations and future growth. Using accounting software is a massive benefit as it can bring efficiency in the bookkeeping process. A business owner will have quality financial intelligence, trends and data handy to make critical decisions.

Accounting software is a huge life-saver for any business owner who has very less personal time or resources to dedicate to proper bookkeeping and accounting practices. It helps such businesses to automate their bookkeeping process (to an extent), acting as a digital accountant for the same.

List of accounting software is growing with every day; however, there are few dominant players. It is never an easy decision to decide which one to use, as each has its pros and cons. Key here is to ask your self, what you need from your accounting software and what are your requirements? Now, let us explore the 7 best accounting software for your small small business in the UK along with their pros and cons.

Top Accounting Software for Small Businesses

1.   Intuit QuickBooks Online

Intuit’s QuickBooks is one of the established players in the software market. It is a market leader in North America as per a recent report by It is an incredible online accounting tool that helps you to automate your business’s bookkeeping needs with sufficient ease. It has an excellent integration of invoicing tools, payroll, CIS and project management tools that make collaboration and invoicing hassle-free.


  • Offers free trial
  • Ease of use
  • In-depth payroll solutions
  • Flexible with 3rd party applications
  • Mileage tracking
  • Detailed reports that are highly customisable
  • Various pricing package to suit everyone- sole trader to SME
  • Phone help and support
  • Price ranges between £12 to £30 plus VAT per month


  • Lack of industry and business-specific features
  • Unavailability of proper documentation online
  • Lack of key reports outside of accounting
  • Insufficient Help guides

2.   Xero

Established in 2007, it now captures over 25% of the UK’s accounting software market. Business owners like Xero for its user-friendly interface and depth of reports. Its standardised accounting management process is easy to follow and integrate with any existing business processes. It allows you to manage fixed assets and add dynamic elements to your accounting process on-the-go.


  • Offers free trial
  • Competitive pricing
  • Well-detailed dashboard
  • New report filters
  • Payroll- add on
  • Expense management- add on
  • CIS-add on
  • Project management tools- add on
  • Analytics- add on
  • Employee expenses- add on
  • Tracking feature for inventory management
  • Excellent customer support (online)
  • Comprehensive expense tracking
  • Good project tracking
  • Price ranges between £12 to £33 plus VAT per month


  • Lack of support over the phone and chat
  • Comprehensive improvements in its mobile application
  • Irregular updates
  • Inventory module can be more robust
  • Foreign currency module offers limited functionality

3.   FreshBooks

Started as an online invoicing tool, FreshBooks has come a long way in becoming the go-to online accounting solution for businesses of all scales and sizes.


  • Offers free trial
  • Great importing options
  • Time-tracking facility
  • Highly detailed reports
  • Scalable invoicing solutions
  • Expense-manager
  • Easy to understand and use even for novices
  • Smooth user experience
  • Price ranges between £11 to £38 plus VAT per month


  • Need to fill balance sheets with manual input
  • Cannot be integrated with many e-commerce platforms directly
  • Limited functionality in the mobile app- no access reports on the go
  • Inventory management not suitable for large businesses- eCommerce

4.   Sage 50cloud

The Sage 50cloud is a full-scale and robust desktop accounting application with access to a great set of financial tools and options to customise at will. It also has superb integration with Microsoft Office 365 for better access. Its complex set of features are great for any business though some of its complexity may seem overwhelming for certain companies and business owners.


  • Offers free trial
  • A very sophisticated set of features
  • Exceptional customisation
  • Strong inventory management
  • In-depth records of contact and items
  • Ten different pricing levels for items


  • Lack of any mobile or web application
  • A bit overwhelming interface for some businesses
  • Exceptionally high pricing
  • Dated interface and lack of a proper dashboard
  • Lacks dedicated time tracking features
  • Price ranges between £65 to £132 plus VAT per month

5.   Zoho Books

Zoho Books is not a standalone accounting software but a part of a more extensive productivity suite offered by Zoho. Zoho Books is a comprehensive accounting solution that meets most of the small business accounting needs.


  • Offers free trial
  • Affordable to buy
  • Great user interface with in-depth records and transaction forms.
  • Payment gateways with multiple options
  • Effective document management
  • Great mobile application
  • Outstanding customer support
  • Price ranges between £6 to £18 plus VAT per month


  • Limited payroll integration features
  • Time-tracking is tied to the projects
  • Restriction on number of contacts
  • Limited inventory module

6.   Wave

Wave has always been known for its proactive developments and improvements in the software to make life easier for its customers. The prices are low, and the developer support is vibrant for a software of this scale. You can get access to the original accounting features of Wave for absolutely free and only need to pay once you use its more advanced features.


  • Completely free to use unless payments and payrolls are involved
  • A great set of tools especially helpful for small businesses
  • Can deal with multiple currencies
  • Exceptional dashboard with transaction and payment screens
  • Proactive improvements and regular updates


  • Pretty lagging to use
  • Cannot be customised like QuickBooks Online and FreshBooks
  • The mobile application needs further improvements.
  • Lack of dedicated time tracking features

7.   FreeAgent

FreeAgent is a lesser known but powerful ally for the accounting and bookkeeping needs of small businesses and freelancers. It is an online tool that is rich with features necessary to maintain the day-to-day financial records of a small commercial establishment. Its elaborate dashboard displays a horde of information in various areas of financial management and tracking of that specific business.


  • Extremely User-friendly To Use
  • Easy to Navigate and well-detailed dashboard
  • Expense Management & Tracking
  • Taxation
  • Mobile applications for both mobile and iPad
  • Export invoices to PDF
  • Multiple Payment Gateway Integrations
  • Supports Multiple-currencies

– Pricing Starts from £9.50 per month for sole traders and increases to £12 and £14.50 per month for Partnerships/ LLPs and Limited Companies respectively


  • Search functions has some bugs
  • Lacks proper search filters
  • Contacts that are no longer needed cannot be deleted

Wrapping Up

With this detailed guide, you will now be able to choose the right accounting software for your business based on its specific needs. Most of the details regarding these applications are discussed to help you understand a software’s particular pros and cons. So, dive into this realm with the power of information and help your business to automate its accounting and bookkeeping needs with sufficient ease!

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