Gone are the days of gathering tons of receipts and reports and sending them to your accountant. Today’s accounting is mostly done online with digital accounting software giving businesses the power to do their accounting themselves. You no longer need a degree to do your accounts and you may be surprised to learn that many accountants and bookkeeping professionals use the exact same tools.
The market for online accounting software is huge, with many offering similar features. Take FreshBooks and QuickBooks, for example, both offer users similar tools so it can be hard to decipher which one comes out on top. Luckily there are many comparison guides out there and the good guys at Piesync is a great place to start.
Cloud Accounting
Cloud accounting isn’t just the latest fashion in cloud computing. An incredible 94% of businesses are using cloud applications in multiple areas of their businesses, including admin and CRM, collaboration and, the reason you’re here, accounting. Cloud accounting hosts multiple benefits for businesses who wish to do their accounting themselves. From streamlining to saving you a few bucks, here are some of the key advantages of cloud accounting.
- Automation
Automation can take the pain out of conducting repetitive tasks to allow you to increase efficiency and productivity. Giving you more time to focus on scaling your business.
- Real-Time Updates, Anytime, Anywhere
Unlike traditional accounting software that relies on a local drive, cloud accounting gives users the ability to access their accounts any time of the day and from any location.
- Integration with other cloud apps
There are multiple aspects of business operation that can be managed with cloud apps which means that you can integrate your accounting app with your other cloud apps, streamlining your data and creating better cohesion within your business.
- Cost
Unlike the alternative, cloud-based apps use automatic updates which is crucial for sustaining the functionality of the app, strengthening your security, and saving you money because this requires less maintenance than traditional software. Cloud accounting is also a great solution for businesses who want to go paperless, supporting the climate and, again, saving you money.
- Security
Because cloud accounting is hosted remotely this puts your data in a better and more secure position. If your PC breaks down and you use a software that exists on your local drive, you could lose all of your accounts and potentially much worse if your PC becomes compromised. Cloud accounting apps provide a breakdown of how your data is stored and protected which often includes encryption and multi-layer security such as two-factor authentication.
Making Tax Digital – UK Based Businesses
In 2015, the UK government announced an initiative called Making Tax Digital, ending the current “tax return” system and replacing it with a fully digital tax system by 2020. The aim of the MTD is to simplify tax admin for businesses and the self-employed and includes digital record keeping, making better use of third party information, and frequent updating of compliance data. For UK businesses, finding an accounting software that supports Making Tax Digital should be your top priority as the initiative goes into effect this year. You can find out more information about MTD on the gov.uk website.
Top 5 Accounting Softwares
We’ve compiled a list of five accounting apps to get you on your way to revolutionizing your accounts. All five of these apps are cloud-based and support making tax digital so you don’t have to worry about finding a solution that encompasses both features.
Xero
Affordable and offering inventory management, Xero is a great solution for eCommerce businesses. This software also allows users to customize report filters, integrate with payroll software, and track expenses. Xero doesn’t offer phone or chat support which may make this an inaccessible option for some but overall it’s definitely one to add to your list.
QuickBooks
One of the most popular accounting solutions on the market, QuickBooks offers a lot of features that are great for small and medium-sized businesses alike, including payroll and customizable reports. The QuickBooks dashboard is easy to navigate and this software offers a range of learning tools. The downside? This is one of the more expensive software which may not be an option for those with smaller budgets.
Zoho
One of the best for small businesses, Zoho is another affordable option for those with smaller budgets and boasts a well designed mobile app for users who like to be able to check their accounts on the go.
Wave
Another great solution for small businesses and freelancers is Wave. Wave allows users to take pictures of their receipts and upload them to their system to attach to the relevant record at a later time, it also offers a lot of free features. Downsides to Wave is a lack of payroll for UK users and if you want to file your return with them, you’ll need to integrate relevant software.
QuickFile
With free small and medium accounts, QuickFile is a no-fuss, no-muss solution offering invoicing, receipt management, and banking automation.
How do you choose?
Choosing accounting software can be hard when there are so many on the market. Ultimately the best tool is the one that is right for you and this can come down to multiple factors.
- What type of business you run (small/medium, eCommerce).
- What features you require e.g. payroll, time tracking, etc.
- What your budget is.
- Who will have access to your accounts?
With that in mind, it can help you filter out the options that won’t be able to support your business but do keep in mind that it’s always good to do some reading on what others say and think about the accounting software you might be interested in.