Best Accounting Software for Small Business in 2025

Are you tired of drowning in a sea of receipts and spreadsheets? Accounting software is essential for running and managing small business finances. It is vital for three reasons: it increases accuracy, saves money in taxes, and saves time.

As a small business owner, you know that managing your finances is crucial to success, but it can also be a significant headache. That’s where accounting software comes in. The right software can automate tasks, reduce errors, and give valuable insights into your business’s financial data.

Best accounting software for small businesses

In this post, we’ll explore the best accounting software solutions available today, breaking down their features, pricing, and pros and cons to help you find the perfect fit for your needs. Whether you’re a freelancer, a growing startup, or an established SME, we’ll guide you towards making an informed decision for the right accounting software.

All of these accounting software providers have been extensively researched and reviewed.

Small Business Accounting Software 2025:

  1. QuickBooks Online – top contender for small business and sole traders
  2. Xero – Used by small businesses for its advanced features and app integrations
  3. FreshBooks – Great for invoicing and UK freelancers
  4. Sage – Best for larger businesses
  5. Zoho Books (Free version and can upgrade to paid versions)
  6. FreeAgent – Free version for some bank users
  7. Quickfile – (Best Free Accounting Software For Small Businesses)

When evaluating accounting software providers, it’s essential to compare different options available for small businesses, focusing on specific features, pricing, and the suitability of plans for various business types.

Remember that the best accounting software overall might not be suitable for you. Here is a quick guide to the cost of the top packages.

Best Self-employed

QuickBooks logo black
From £10 per month
Free Trial
Free Onboarding session
90% Discount – 7 Months

Best Small Business

Best Accounting Software for Small Business in 2025
From £16 per month
Free Trial
Integration with apps
90% Discount – 6 Months
Visit Xero

For Business Owners

FreshBooks logo
From £15 per month
Free Trial
Pricing by Client Number
50% Discount – 3 Months

Best Free

Zoho Books Review Logo
From £12 per month
1,000 invoices PA Free
Integrate with Zoho Apps
No Discount

I have been in the accounting industry for over 30 years and decided to test all the major accounting software products to see which is best.

Keep reading to see which accounting software products made the cut and find the best option for YOUR business. We have a FREE PDF and a guide comparing QuickBooks vs. Xero pricing and features.

Quickbooks Online (Best For Products)

QuickBooks discount banner
Quickbooks review dashboard

QuickBooks’ popularity stems from a combination of factors that make it a compelling choice for many small businesses:

Long-Standing Reputation and Market Dominance: QuickBooks has been a top accounting software provider for years and is known for its strong reputation and brand recognition. An early entrant in the market, QuickBooks established a large user base and became the preferred software for many accountants.

QuickBooks Sole Trader Plan: The QuickBooks Sole Trader Plan specifically targets sole traders and freelancers who need a straightforward yet powerful tool to manage their business finances. This plan offers a range of features that cater to sole traders’ unique needs, making it easier to keep track of income, expenses, and tax obligations.

Comprehensive Features: QuickBooks offers various features, from basic bookkeeping to advanced inventory management and payroll options. This comprehensive suite allows businesses to manage their financial operations efficiently within a single platform, ensuring streamlined tracking and reporting of their financial data.  

User-Friendly Interface: QuickBooks is known for its user-friendly interface, which makes it accessible even to those without deep accounting expertise. This intuitive design significantly reduces the learning curve, allowing business owners to take control of their finances.

Strong Ecosystem and Integrations: QuickBooks offers an extensive network of add-ons and integrations with various business applications, enhancing its functionality and flexibility. It connects with CRM systems, payment processors, and other tools, simplifying workflows.

Cloud-Based Accounting Software: QuickBooks Online offers cloud-based software, enabling users to manage their finances from anywhere with an internet connection.  

Scalability: QuickBooks offers various plans tailored to accommodate businesses of different sizes and complexities. Its scalability allows businesses to begin with a basic plan and upgrade as they grow.  

Accountant-Friendly: Accountants widely use QuickBooks, making it easy for businesses to collaborate with financial professionals.  

Good Customer Support: QuickBooks provides various customer support channels, including phone, email, and online resources.  

While QuickBooks may not be the perfect solution for every business, its features, ease of use, and widespread adoption make it a popular choice for many.

QuickBooks Key Features

  • Income and Expense Tracking
  • Bank Reconciliation
  • Invoicing
  • Reporting
  • Inventory Management
  • Project tracking
  • Payroll
  • Making Tax Digital Compliant
  • Cash flow insights

QuickBooks Pricing

The QuickBooks online accounting software for small businesses starts at just £10 for sole traders and £14 for companies.

However, you can get a 90% discount on the first seven months.

Take a look at the pricing plans for 2025.

Intuit QuickBooks Pricing

Sole Trader

  • Prepare Self-Assessment Tax Returns
  • Get Tax Estimates
  • Send Invoices
  • Track Mileage
  • Separate Personal Expenses
  • Manage Income & Expenses
  • Free Onboarding Session

Simple Start

  • Tax Estimates
  • MTD VAT
  • Invoices paid instantly
  • Manage Income & Expenses
  • Telephone Support
  • Single User
  • Track Mileage
  • Estimates & Quotes

Essentials

  • Everything in Simple Start
  • Manage Bills
  • Multi-Currency
  • 3 Users
  • Most Popular
  • Cash Flow
  • VAT Error Checker
  • Track Employee Time

Plus

  • Everything in Essentials
  • Manage Stock
  • Profitability for each Project
  • Set Budgets
  • 5 Users

Quickbooks Cons

  • No payroll or project management features are included.
  • Limitations with file size, data, and the number of users.

Get 90% OFF QuickBooks Your First 7 Months

Get 90% OFF QuickBooks Your First 7 Months

As a special offer, we collaborate with QuickBooks to provide a 90% discount for your first seven months, starting at just £1 per month.

Visit QuickBooks

Xero (Easiest To Use)

Xero accounting software demo

Xero has surged in popularity, especially in the UK, due to a compelling combination of features and a focus on user experience:

Xero discount

Cloud Accounting Software and Accessibility: Xero was built from the ground up for the cloud, making it accessible anytime, anywhere, on any device with an internet connection.

User-Friendly Interface: Users praise Xero for its clean, intuitive interface, which they find easy to navigate even with limited accounting knowledge. It focuses on user experience, simplifies bookkeeping tasks, and makes financial management less daunting.

Excellent Invoicing Features: Xero provides excellent invoicing features, including customisable templates, online payment options, and automated reminders. These features simplify the payment process and help businesses maintain a steady cash flow.

Strong Bank Reconciliation: Xero’s bank reconciliation features are efficient. They automatically import and categorise transactions, saving businesses significant time and effort.

Robust Reporting and Insights: Xero provides a wide range of insightful reports that clearly show a business’s financial health. These reports help businesses track performance, identify trends, and make informed decisions.

Apps and Integrations: Xero features a robust app marketplace with numerous integrations to enhance its functionality and streamline workflows. Its powerful API connects seamlessly with CRM systems, payment gateways, and other essential applications. It allows for custom solutions and automated processes, tailoring the software to meet specific business needs.

Focus on Collaboration: Xero allows collaboration between businesses and their accountants with features allowing easy data sharing and communication.

Strong UK Focus and Making Tax Digital Compliance: Xero has a strong presence in the UK and fully complies with Making Tax Digital (MTD) regulations.

Xero’s combination of user-friendliness, robust features, and a focus on cloud-based accessibility has made it a favourite among small businesses and accountants in the UK.

Xero Key Features for Small Businesses

Some of Xero’s key accounting features include:

  • Manage and pay your bills
  • Submit VAT returns online
  • Claim Expenses
  • Bank Connections
  • Accept Payments
  • Track Projects
  • Project tracking
  • Quotes and estimates
  • cash flow forecasting
  • Making Tax Digital Compliant

Xero Accounting Software Cost

Xero starts at just £15 per month. Unlike other small business options, it does not offer an annual plan.

Take a look at the pricing table below.

Best Accounting Software for Small Business in 2025

Xero Cons

Here are the main cons of Xero:

  • There are lots of additional charges, depending on your needs
  • It does not have phone support
  • Multi-currency support only on the premium plan of £42 per month

Xero Best Offers Available

Xero offers a 90% discount for 6 months.

Xero discount

FreshBooks (Best For Service Businesses)

FreshBooks review dashboard

FreshBooks has established a strong niche in the accounting software market, particularly appealing to certain types of businesses due to these key strengths:

Invoicing Excellence: FreshBooks is renowned for its exceptional invoicing features. It offers customisable templates, automated reminders, online payment options, and recurring invoices, making it incredibly easy for businesses to create professional invoices, track payments, and manage their cash flow effectively.

Simplicity and Ease of Use: FreshBooks prioritise user experience. It provides a clean and intuitive interface that users can easily navigate without an accounting background. It is ideal for freelancers, solopreneurs, and small business owners looking for a straightforward way to handle their finances.

Time Tracking and Project Management: FreshBooks offers robust time tracking capabilities, allowing users to log hours easily, track project progress, and generate accurate invoices based on time spent. It is particularly valuable for service-based businesses and freelancers who bill clients hourly.

Client Management Approach: FreshBooks focuses on building strong client relationships through features such as client portals, feedback tools, and personalised communication options.

Mobile Accessibility: FreshBooks provides a well-designed mobile app that allows users to manage invoices, track expenses, and stay on top of their finances from anywhere.

Good Customer Support: FreshBooks is known for its responsive and helpful customer support, which is provided through various channels like phone, email, and online resources.

Growing Feature Set: While known for invoicing, FreshBooks continues to expand its accounting features, including expense tracking, basic reporting, and bank reconciliation.

While FreshBooks may not be as feature-rich as some competitors, its focus on invoicing, simplicity, and client management makes it a popular choice for freelancers, service-based businesses, and those prioritising ease of use.

Freshbooks Key Features

Some of FreshBooks key features include:

  • Cloud-based accounting software
  • Invoicing
  • Income and Expenses tracking
  • Time tracking
  • Projects
  • Estimates
  • Payments
  • Reporting
  • Bank Reconciliation
  • Making Tax Digital Compliant

FreshBooks Pricing

Freshbooks also starts at a similar rate as most other best accounting software products on this list.

If you’re a freelancer, it’s a great choice because you get more project-specific tools despite being the same price.

Take a look at the full pricing table below.

FreshBooks Pricing 2024

Freshbooks Cons

  • The mobile app is a bit limited
  • Some users have complained that the software isn’t suited for larger businesses.
  • Not as many product/inventory management features as competitors

Freshbooks Best Deal

The best offer for FreshBooks is a 3-month 50% discount.

Visit FreshBooks

Sage Business Cloud Accounting

Sage Accounting Invoice Templates
Sage Accounting Invoice Templates

Sage has a long-standing history and strong presence in the UK, making it a popular choice for businesses of all sizes. Here’s why it continues to be a top contender:

Established UK Presence and Heritage: Sage was founded in the UK and understands the UK market and its specific accounting needs. This local expertise makes them a trusted provider, particularly for businesses seeking compliance with UK regulations.

Comprehensive Product Range: Sage offers a wide range of accounting software solutions, from basic bookkeeping tools for startups to more advanced enterprise resource planning (ERP) systems for larger companies.

Payroll Features: Sage is well-regarded for its robust payroll functionalities, including automated calculations, tax compliance, and pension management.

Scalability and Customisation: Sage solutions can adapt to businesses as they grow, offering scalability and flexibility to accommodate changing needs. They also provide customisation options to tailor the software to specific industry requirements.

Desktop and Cloud-Based Accounting Software: Sage provides desktop-based (Sage 50) and cloud-based accounting software, catering to different preferences and working styles.

Integration with Other Sage Products: Sage offers a suite of business management solutions, including CRM and HR software, which can integrate seamlessly with their accounting software.

Strong Accountant Network: Sage has an extensive network of accountants and partners trained and certified in their software.

Making Tax Digital Software: Sage fully complies with Making Tax Digital regulations, ensuring UK businesses can accurately and efficiently fulfil their tax obligations.

While Sage may have a steeper learning curve than some competitors, its comprehensive features, strong UK focus, and scalability make it a popular choice for businesses seeking a robust and reliable accounting solution.

Key Features

  • Easy bank reconciliation
  • Can grow with the business
  • Unlimited invoices
  • Good customer support
  • Unlimited users
  • Inventory tracking (stock)
  • Time tracking
  • Cash flow management
  • Making Tax Digital Compliant

Sage Cons

  • There is no free trial, but you can sign up for three months free of charge
  • It can be a steep learning curve for new users

Sage Business Cloud Accounting Pricing

Best Accounting Software for Small Business in 2025Best Accounting Software for Small Business in 2025

Sage Cons

  • No free trial, but you can sign up for three months free of charge
  • It can be a steep learning curve for new users

Sage Business Cloud Accounting Pricing

Sage Accounting Software Pricing 2024

FreeAgent – Part of the NatWest Group

FreeAgent has become popular for UK sole traders, small businesses, and contractors. Here’s why:

FREE for some bank account users: Free if you have a business bank account with NatWest, Royal Bank of Scotland, Ulster Bank or at least one transaction per month with Mettle.

Tailored for Small Businesses and Freelancers: Small businesses, freelancers, and contractors will find FreeAgent designed to simplify accounting. Its features and interface make it accessible for those with limited accounting knowledge.

User-Friendly Interface: FreeAgent is known for its intuitive and well-designed interface. It’s easy to navigate, understand, and use, making accounting less daunting for non-experts.

Comprehensive Feature Set: Despite its focus on simplicity, FreeAgent offers a robust suite of features, including invoicing, expense tracking, time tracking, project management, estimates, and reporting. It covers all the essential accounting needs of small businesses.

Strong UK Focus and MTD Compliance: FreeAgent is a UK-based company with a deep understanding of UK tax laws and regulations. It’s fully compliant with Making Tax Digital (MTD) for VAT, ensuring businesses can easily meet their tax obligations.

Excellent Self-Assessment Tax Return Features: FreeAgent simplifies the process of filing self-assessment tax returns for freelancers and small business owners. It automatically calculates your tax liability and allows you to submit your return directly to HMRC through the software.

Time-Saving Automation: FreeAgent automates many tasks, such as bank feeds, recurring invoices, and expense categorisation, saving users time and reducing manual effort.

Integration with Other Tools: FreeAgent integrates with other business tools, including banks, payment gateways, and CRM systems, streamlining workflows and improving efficiency.

Great Customer Support: FreeAgent offers excellent customer support through various phone, email, and live chat channels. Its team is known for being helpful and responsive.

Mobile App: Its mobile App allows users to manage their finances, track time, and create invoices on the go, providing flexibility and convenience.

FreeAgent’s combination of user-friendliness, comprehensive features, UK-specific focus, and excellent support makes it a popular choice for freelancers and small businesses looking to simplify their accounting processes.

Zoho Books (Best For Startups)

Zoho Books accounting software

Zoho Books is gaining traction as a compelling accounting software option, especially for budget-conscious businesses. Here’s a breakdown of its key strengths:

Affordability and Free Plan: Zoho Books offers a free plan for up to two users and limited transactions, making it an attractive starting point for very small businesses. It allows users to experience the software’s core features before committing to a paid plan.

Comprehensive Feature Set: Despite its affordability, Zoho Books offers a surprisingly robust set of features, including invoicing, expense tracking, bank reconciliation, financial reporting, and project management.

User-Friendly Interface: Zoho Books boasts a clean and intuitive interface that’s easy to navigate, even for users with limited accounting experience.

Strong Integration with Zoho Ecosystem: Zoho Books seamlessly integrates with other Zoho applications, like Zoho CRM and Zoho Invoice, creating a unified business management platform. This streamlines workflows and allows businesses to manage their operations efficiently.

Automation Capabilities: Zoho Books offers automation features for tasks like recurring invoices, payment reminders, and bank feeds, saving businesses time and reducing manual effort.

Mobile Accessibility: Zoho Books provides a mobile app that allows users to manage their finances on the go, track expenses, and access reports from their smartphones or tablets.

Good Customer Support: Zoho Books offers various customer support channels to assist users with questions or issues, including email, phone, and online resources.

Zoho Books Features

Zoho Books main accounting features include:

  • Manage invoices
  • Expense tracking
  • Client Portal
  • Purchase orders
  • Multi-lingual invoicing
  • Cloud accounting software

Zoho Books Pricing

Zoho Books has the advantage of offering a completely free plan for businesses with single user and limited invoicing and expenses.

If you’re starting and looking for a FREE option that can scale with you in the future, ZohoBooks is an excellent choice. Plus, the next plan is only £10 per month.

Take a look at the pricing table below.

Zoho Books Pricing

Zoho Books Cons

  • Lacks some integrations outside of its tools, such as WorldPay and some banks
  • Payroll is a separate app
  • Not great invoice templates

Zoho Books Best Offers

I couldn’t find any coupons or offers for the Zoho Books accounting software, but you can sign up for a free account below.

Quickfile Accounting – Free Accounting Software

Quickfile accounting software dashboard

QuickFile is free software for up to 1000 ledger entries per year.

Automated bank feeds are an additional £15 + VAT, but not everyone needs to use bank feeds.

QuickFile Features

QuickFile is free accounting software for small business owners; the main features include:

  • Trustpilot reviews score 4.8 out of 5
  • Up to 1000 Nominal transactions free
  • Capture receipts within the App
  • Quickly send estimates and turn them into invoices once approved
  • Invoice in any currencies
  • Online payments using Stripe
  • Automatic payments
  • VAT returns to track and file

QuickFile Pros

Here are the pros of the Quickfile accounting software:

  • It’s FREE, and you only need to pay for bank feeds or over 1000 Ledger entries
  • Unlimited users, so you won’t need to pay to add accountants, partners, etc.
  • The QuickFile accounting and bookkeeping software has multi-currency support
  • Receive online payments via Stripe
  • QuickFile comes with complete invoicing and accounting tools
  • Online community for support

QuickFile Cons

  • You could go over the 1000 nominal transactions and have to pay £45 per year.
  • Adverts within the software can be annoying.
  • Reports are limited (it is hard to do month-to-month comparisons)

What are the Advantages of Using Accounting Software

Accounting software offers many significant advantages for small businesses for its financial data. By streamlining data entry processes, accounting software makes tracking important accounting information such as income and expenditures easier.

It is crucial to select UK accounting software that complies with regulations such as Making Tax Digital to ensure your business meets all legal requirements.

Many accounting programs offer intuitive user interfaces that allow businesses to quickly enter and manage financial data without relying on costly accounting services. One significant advantage is linking the software to your business bank accounts, enabling you to import transactions easily.

Accounting systems also implement double-entry accounting principles that help to provide greater accuracy in financial reporting. Overall, accounting software is essential for businesses that want to reduce costs and improve efficiency in their accounting functions.

Small Business Accounting Software: Frequently Asked Questions

Finally, I wanted to answer frequently asked questions about the best accounting software for small business finances.

What is the easiest small business accounting software?

If you want to pick accounting software primarily for ease of use, I recommend Xero.

The dashboard is clean, beautiful, and easy to learn. Most user reviews agree it’s #1 in the industry for ease of use.

However, it may not be suited for your business model for features.

Does a small business need accounting software?

In most cases, yes. There are some exceptions, for example, if you are a sole trader and only work with a few clients or customers. However, bookkeeping software will likely help you run your business more efficiently.

If you don’t want to switch from how you currently do business, check out some of my spreadsheet templates.

Can I do my Small Business Accounting?

You can manage your small business accounting yourself! This website is here to help business owners like you handle their accounting tasks.

But if you scale your business, hiring a skilled accountant would make sense.

What is better than QuickBooks?

Quickbooks is one of the best small accounting software products. So it depends on what in particular you are looking for:

  • Xero is better for ease of use and for inviting additional users
  • Freshbooks is better for freelancers & service businesses
  • Zoho is better for beginners

What About The Wave Accounting Software?

Wave Accounting has announced that it will withdraw from the UK and not accept new accounts. The company was popular with small business owners because it offered free software.

Final Thoughts

That’s it. I hope you have enjoyed this guide on the best accounting software for small businesses. If you want to learn more about accounting and bookkeeping for small businesses, check out some of the related articles below. It is worth taking the time to choose accounting software and review its features, including time tracking, cash flow forecasting, expense management, and reporting.

We hope you find the best solution for your business finances.

Best Accounting software for self-employed

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Beginner Bookkeeping

Accounting Basics

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