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Web-Based Accounting Software for Small Business

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedNov 20222 min read

Small businesses have more choices than ever when it comes to accounting software. From annual bookkeeping tasks to everyday account reconciliation, the best software keeps your finances on track. In this guide, we’ll break down some key features to look for in today’s best web-based accounting software for small businesses.

What are the benefits of web-based accounting software for small businesses?

Accurately recording business transactions is non-negotiable. One of the benefits of using web-based accounting software is that it automatically tracks your accounts payable and accounts receivable. This ensures your accounts are up to date, not only for tax purposes, but also for understanding your business’s profitability and cash flow. Using software reduces time wasted on manual admin, including data entry. Software syncs your business accounts to automatically track income and expenses.

With the roll-out of HMRC’s Making Tax Digital in 2019, many businesses are now required to use compatible software for submitting VAT returns. For this reason, web-based accounting software carries the additional benefit of compulsory tax compliance.

The best web-based accounting software for small businesses

There are dozens of options out there that tick all the boxes mentioned above. With more added to the market each day, how can you choose the right fit? Here are a few of our top choices to consider.

Xero

Ideal for small businesses, Xero stands out for its clean, user-friendly interface and over 800 integrations. Accessible through the cloud, it comes with a mobile app for on-the-go accounting tasks. Xero’s most basic Starter plan includes automated reports and VAT submissions as well as invoicing. You can upgrade to the Standard or Premium plans to access additional features such as currency exchange and unlimited invoices.

Intuit QuickBooks

Intuit QuickBooks Online is a great all-rounder for businesses of all sizes, but small businesses reap particular benefit from its excellent customer support. You can access all its features from a central dashboard, which makes it easy to get started. It’s scalable, meaning it can grow along with your business. It’s also cloud-based with an accompanying mobile app and plenty of third-party integrations. Like Xero, there are several tiered-price subscription plans to choose from. More advanced features include things like cash flow tracking and inventory management.

Sage50 Cloud

This accounting software from Sage covers all the bases for a small business. At its most basic starter level, users can create and send invoices, reconcile bank accounts, and submit VAT returns automatically. More complex plans offer additional features such as cash flow forecasting, inventory management, and more. Like others on this list, it integrates with multiple third-party applications to fit into your existing systems.

FreeAgent

While some accounting software charges extra for add-ons and multiple users, FreeAgent charges a straightforward monthly flat fee. The price depends on your tax status and needs. Limited companies benefit from corporation tax filing and dividend vouchers, while sole traders can file self-assessment returns automatically. It’s also free of charge for existing NatWest and RBS business banking customers.

How to choose web-based accounting software for small businesses

You’ll find the same core set of features with all accounting software mentioned above. However, it’s important to compare pricing plans, contracts, and terms and conditions to find an option that suits your budget. You should also consider compatibility. How will the software integrate with your existing accounting tools? Will it add a layer of complexity or make your life easier?

All the web-based accounting software above integrates with GoCardless. This makes it easy to merge accounting, billing, and payment collection for a joined-up workflow. Streamline the payments process with automatic invoicing and reconciliation, and benefit from payments intelligence products like Success+ and Protect+, to protect you from failed payments and fraud.

We can help

GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.