Accounting Software for Charities

What is accounting software, and what are its benefits for non-profit organisations?

Accounting software for charities is something that many charities need, but not all are aware of its benefits. It helps to keep track of all the financial information and data for a charity.

Accounting software assists with reporting or figuring out how much money was donated by which donor, what percentage of income went towards administrative costs, etc.

Accounting software also provides reports that non-accounting professionals can use to review where their money has gone.

This post will primarily concentrate on accounting software for non-profits. However, we do have a FREE Excel cashbook available, which is suitable for small non-profit organisations. The details are included in this post.

What do Accounting Software packages offer?

Accounting software can be a beneficial resource for charities. It can help keep track of all income and expenses in one place and provide financial reports essential for making sound decisions about the charity’s future. Accounting software can also reduce the time required for bookkeeping and increase the accuracy of financial figures.

However, there are different types of accounting software, and the one you choose for your charity will depend on its size and type. As well as standard packages available for anyone to use, specific ones are available that are tailored to non-profit organisations.

Using an off-the-shelf package can help you save time on bookkeeping activities. Bank feeds and scanning documents straight into the program are two specific features that might save time.

Best Self-employed

From £10 per month

Free Trial

Free Onboarding session

90% Discount – 7 Months

Visit Quickbooks

Best Small Business

From £16 per month

Free Trial

Integration with apps

90% Discount – 6 Months

Visit Xero

For Business Owners

From £15 per month

Free Trial

Pricing by Client Number

50% Discount – 3 Months

Visit FreshBooks

Best Free

From £12 per month

1,000 invoices PA Free

Integrate with Zoho Apps

No Discount

Visit Zoho Books

How to choose the right accounting software for your non-profit organisation

When looking for accounting software for a non-profit organisation, it is essential to consider the crucial features of your organisation. Some of the features to look for include:

• Tracking donations and expenses
• Track Gift Aid
• Restricted Funds or fund accounting
• Generate Reports
• Creating Invoices
• Payroll
• Receipt scanning
• Bank Feeds

You can compare different accounting software packages once you have identified your organisation’s essential features.

Restricted Funds for Charities and Accounting Software

A common feature that non-profit organisations may need is restricted funds or fund accounting. These are funds that the charity’s trustee must spend in a specific way or purpose as agreed when donated.

Accounting software can help track restricted funds. Accounting software will provide accurate reports on the money donated and its use, increasing transparency for all users in the organisation.

If you are using an off-the-shelf package, it may help set up departments or classes to track the funds.

There are also specific packages for charities, making it easier to track fund accounting.

The Best Accounting Software for UK Charities in 2024

Below are our top five charities’ accounting options:

FreshBooks

For non-profits without an accounting system, Freshbooks helps monitor expenses, create invoices, generate financial reports and track projects.

Time tracking helps identify how much time was spent on a project, which can be used for billing or other reporting purposes. Management tools help track and monitor a project’s progress so that any potential issues can be addressed early on.

Advantages

• Cloud-based accounting software
• Send Invoices
• User-friendly interface
• Expense reports
• Mileage Tracking
• Support through online chat
• Up-to-date view of financial activities
• Detailed Reports

Pricing

FreshBooks offers a free trial for new users. There is a monthly subscription fee, but the price depends on how many people you invoice. If you’re based in the UK, here are the prices for you:

– Up to 5 clients: £15 per month

– 50 clients: £25 per month

– Unlimited clients: £35 per month

Prices are for single users, with £8 for each additional user.

QuickBooks Online

QuickBooks Online is cloud-based software that allows you to access your accounts anywhere with an internet connection. This option is excellent for organisations with a remote workforce or volunteers.

QuickBooks is a well-known accounting software that charities can use to manage their finances. It is easy to use and helps track income and expenses. QuickBooks can also help produce financial reports, which can help prepare for grant applications or tax filings.

One of QuickBooks’s essential advantages is that it can help quickly set up custom reports for different purposes. This allows charities to drill down into vast amounts of data and find patterns or irregularities. The software also helps charities manage their donor information and finances in one place.

When setting up QuickBooks accounts, you can choose the charity option if you are a registered charity or non-profit. Your accounts will include the specific categories and regulations required for charitable organisations.

QuickBooks Pricing

Intuit QuickBooks has a pricing structure the will suit most non-profit organisations in the UK.

The price includes free phone and online chat with support and access to online tutorials and the QuickBooks community forum.

Liberty Accounts

Liberty Accounts is an excellent piece of accounting software for small businesses, churches and charities in the UK. It offers a wide range of features, including fund accounting and support for Gift Aid, that are not available in other software packages aimed at these types of organisations. It makes it an ideal choice for organisations that need to manage their accounts and payroll effectively.

Advantages of using Liberty Accounts for non-profit

• Integrated donor ledger supports gift aid
• quick and easy gift aid claims
• Fund accounting makes it easier to manage restricted funds
• Making Tax Digital for VAT returns – ideal for churches
• Payroll software
• Reports
• Support on phone and email
• Cloud Accounting Software

Pricing

Offers a free trial

-From £12.95 per month

-Scalable for larger organisations

Overall, it is an excellent tool for charities and makes accounting more straightforward and more efficient.

Visit the Liberty Accounts website.

Sage Accounting Software

Sage accounting software is a great choice for non-profit organisations.

It offers 50% off the subscription price, and it’s easy to use. The software is designed to help organisations manage their finances efficiently and effectively. It’s a great way to keep track of donations, expenses, and other financial information.

The online form takes just a few minutes to complete. The software is easy to use, so even those less familiar with accounting can quickly start.

So if you are a registered non-profit charity, it is worth looking into Sage.

Sage Pricing

There is a free trial available, so you can try it before you buy.

-The monthly subscription fees start from £12 per month or £6 for UK charities.

-The Standard accounting package is £24 per month or £12 for UK charities.

It’s worth looking into if you’re a UK-registered charity, as there are discounts and a trial available so that you can test it out first.

Xero

Xero is one of the leading accounting software products in the UK.

Xero is easy to use, and it can help non-profit organisations to save time and money. Accounting in Xero is simple with its intuitive dashboard-like interface, allowing users to manage all aspects of their business through one platform.

One of the main benefits of XERO is that it comes with a host of additional apps. Apps include fundraising, donor management and marketing.

If you’re a large non-profit organisation, using the right tools and adding extra features to your software might help you manage it more efficiently.

Xero Pricing

Like most providers, Xero offers a free trial.

Read our review on Xero and also our comparison of QuickBooks vs Xero.

Charity accounting template: receipts and payments accounts

If you’re a small non-profit organisation, Excel templates are an excellent option instead of accounting software. We’ve developed a completely free cashbook template that allows you to input all of the income and expenses for the year and generate the figures required.

It can be a great way to keep track of your finances and ensure that your charity is on track financially.

To hire or outsource for Nonprofit Accounting software

There are a few different options to consider when it comes to accounting for a non-profit organisation. One option is to hire a bookkeeper to manage the books and keep track of everything. It can be a great option if you have the budget for it, as it can take a lot of the burden off of you and allow you to focus on your core mission. However, not all organisations have the budget for a full-time bookkeeper.

Some bookkeepers will volunteer their time for free or at a reduced cost to charitable organisations, especially if they are close to their hearts. I volunteer as a bookkeeper for free to help a local charity.

Conclusion about Accounting Software for Charities

Accounting software for nonprofits can be an excellent way for charities to manage their finances more efficiently. There are several different providers, and most offer free trials, so you can try them before you buy. The pricing is affordable, and the software is easy to use. So, if you’re looking for accounting software for your charity, be sure to check out the options available.