Best Accounting And Bookkeeping Software For Small Businesses

Top picks of accounting and bookkeeping software

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Accounting and bookkeeping software is a game-changer for small business owners, offering an affordable way to manage finances, track income and expenses, and prepare for tax season. It’s an optimal solution for start-ups or small businesses that need to tighten their belts at the initial stage, rather than hiring an accountant. But there are so many different kinds of software today, that it can be hard to pick the right one. This guide will show you the best options for different kinds of small businesses. It will help you choose the best software to manage your business’s money.

Why Your Business Needs Accounting and Bookkeeping Software

Back in the day, accountants would end the year buried in huge piles of account books, trying to sort everything out. Nowadays, even small businesses use accounting software to simplify this task. If you’re still using old methods with lots of paperwork, you know how hard it is to manage financial records, especially when they’re spread out. Mistakes in these accounts can also cause problems in other business areas, like inventory or sales, potentially harming your business.

This is where accounting software comes in as a game-changer. It manages your business’s financial data and transactions, automating many tasks. You don’t need to manually enter every price, order, or invoice. It helps in timely bill payments, sending invoices to customers, and keeping your accounts organized. Plus, it ensures you comply with financial regulations, avoiding tax issues. The best part? You don’t need to be an accounting expert to use it – modern software is designed to be user-friendly, making financial management accessible to everyone.

What to Look For in Accounting and Bookkeeping Software

If you’re searching an accounting and bookkeeping software for your business, consider these factors:

Ease of Use:

The software should have an intuitive interface that is easy to navigate. A steep learning curve can lead to increased training costs and resistance from staff.

Industry-Specific Features:

Certain industries have unique accounting requirements. Look for software that caters to the specific needs of your industry (e.g., construction, retail, non-profit,…).

Integration Capabilities:

Check if the software can integrate with other systems you use, such as CRM, e-commerce platforms, payroll, or banking software. Seamless integration can save time and reduce errors.

Scalability:

The software should be able to grow with your business. It should support additional users, more complex operations, and increased transaction volumes as your business expands.

The scalability of accounting and bookkeeping software

Pricing:

Consider both the upfront costs and ongoing expenses. Some software charges monthly or annually, while others might have a one-time purchase price.

Be aware of additional costs for updates, add-ons, or extra features.

Cloud-Based or On-Desktop:

Cloud-based solutions offer the convenience of remote accessibility and typically have lower upfront costs, while on-desktop solutions provide more control over data security and storage. Although they often require a higher initial investment, on-desktop systems can be more cost-effective in the long run.

Multi-Currency and Multi-Language Support:

If your business operates internationally, look for software that supports multiple currencies and languages.

Tax Preparation and Filing:

Software that assists with tax calculations, preparation, and electronic filing can be extremely valuable, especially for businesses without a dedicated tax professional.

The ability to prepare and file taxes of the software

User Reviews and Feedback:

Check out reviews and feedback from other users, especially those in similar industries or business sizes, to gauge the software’s performance and reliability.

Best Accounting And Bookkeeping Software In 2023

Software Key Features Pricing (as of 2023) Maximum Users Time Tracking Inventory Tracking Phone Support
QuickBooks Online – Bill management

-Income and expense tracking

– Invoicing and payments- Comprehensive reporting

-Self-Employed $5/month

– Small Business Plans: $10 – $60/month

Up to 25 in Advanced plan Can manually enter time in Essentials plan and higher; automatic time tracking costs extra Yes, but only in Plus plan and higher Yes, available seven days a week
Xero – Financial reports

– Easier payments

– Information security

– Xero Expenses

– 24/7 online support

– Business performance dashboard

– Early: $9/month

– Growing: $30/month

– Established: $60/month

Unlimited Yes, but only in Established plan Yes Does not provide a phone number, but a rep will call if necessary
Zoho Books – Customizable invoicing

– Client portal

– Easy billing

– Powerful bank reconciliation

– Accounting automation

– Document management

– Basic: $9/month

– Standard: $19/month

– Professional: $29/month

Up to 15 in Ultimate plan Yes, in paid plans Yes, Zoho Inventory offers free, integrated plans Yes, available weekdays in paid plans
FreshBooks – Task automation

– Cloud-based access

– Smart invoicing

– Expense tracking

– Detailed reports

– Lite: $15/month

– Plus: $25/month

– Premium: $50/month

Up to two in Select plan Yes Yes Yes, available weekdays
Wave – Free invoicing, accounting, and receipt scanning

– Easy setup

– Unlimited bank connections

– High security

-Comprehensive reports

– Free (additional fees for online payments and payroll services) Unlimited No No No live support available unless you subscribe to a paid Wave product
Sage 50 – Cloud and mobile accessibility

– Bank reconciliation

– Customizable invoicing

– Stock management

– App integrations

– Accounting Start: $10/month

– Accounting: $25/month

Up to 40 in Quantum Accouting plan No Yes Yes, available weekdays
QuickBooks Enterprise – Advanced reporting

– User role customization

– Inventory management

– Field service management

– Varies based on plan Up to 40, but each user license costs extra Yes, but only in Diamond plan and fees apply Yes Yes, available 24/7
Kashoo – Easy to use

– Automation in accounting tasks

– Tracking invoices and expenses

– Double-entry accounting

– Detailed reporting

– Annual Plan: $199.95/($16.66/month).

– Pay As You Go Plan: $29.95/month.

Not specified Not specified Not specified Phone support available
Patriot Software – Accounting and payroll software

– Invoicing, tracking money, automatic bank imports

– Bill payments, financial reports

– Payroll features

– Accounting: Starting at $20/month

– Payroll: Starting at $17/month + $4 per employee

Not specified Time & Attendance add-on available Not specified Available weekdays
GoDaddy Bookkeeping – Direct integration with platforms like Amazon, eBay, and Etsy

– Automated income and expense tracking

– Invoicing and payment processing

– Tax worksheets and reports

– Get Paid: $4.99/month

– Essentials: $9.99/month

– Premium: $14.99/month

Unlimited No No No

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FAQ

1. What Is the Difference Between Accounting and Bookkeeping Software?

Explanation of how accounting software typically offers a broader range of financial management features compared to bookkeeping software, which focuses more on recording financial transactions.

2. Is Cloud-Based Accounting and Bookkeeping Software Secure?

Yes, cloud-based accounting and bookkeeping software can be very secure, often employing advanced security measures like encryption, multi-factor authentication, and regular security audits to protect data. However, the level of security can vary between providers. It’s important to choose a reputable provider that complies with industry-standard security protocols and regularly updates its security measures.

Is cloud-based accounting and bookkeeping software secure?

3. How Does Accounting And Bookkeeping Software Help with Tax Preparation?

Accounting and bookkeeping software simplifies tax preparation by organizing financial data and transactions in a systematic way. It can automatically categorize expenses and revenues, making it easier to identify deductible expenses and taxable income. Many accounting software solutions are equipped with features to calculate tax liabilities, generate tax reports, and sometimes even file returns directly through the software. They also keep track of changing tax laws and rates to ensure compliance.

4. Can I Access My Accounting and Bookkeeping Software on Mobile Devices?

Yes, many modern accounting and bookkeeping software offer mobile apps or mobile-friendly versions that allow users to access their financial data from smartphones or tablets. This mobile accessibility enables business owners and accountants to manage finances, create invoices, track expenses, and view reports on the go.

5. How Long Does It Take to Set Up Accounting And Bookkeeping Software?

The time it takes to set up accounting and bookkeeping software can vary depending on the complexity of the software and the specific needs of your business. Simple, cloud-based solutions can often be set up in a matter of hours or a few days. More complex systems, especially those requiring customization or integration with other business systems, might take weeks or even months to fully implement. The process can be expedited by having all necessary financial information readily available and, if needed, seeking assistance from the software provider or a professional consultant.

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