Mon - Sat 9.00 - 18.00 Sunday Closed
0345 512 0102

6 Best Cloud Accounting Software For SMEs In The UK

If you’re a business owner in the UK, be it small or medium, you know how dreadful it is to perform accounting tasks manually. Whether it is creating invoices for your customers, keeping a track of cash flow, or making and receiving payments, all these tasks are time-consuming. What you need is a tool that eases accounting tasks, which is possible using cloud accounting software. Cloud accounting software will relieve you from all the accounting pressures, giving you ample time to concentrate on expanding your business.

Why use cloud accounting software and not a desktop-based one such as excel? Cloud-based accounting software lets you access your data from any place with any device. This way you can easily track your finances no matter where you are. Additionally, your data is in safe hands. The chances of losing data are extremely low which makes it the go to tool for accounting.

Having said that, there are ample cloud accounting options available in the market, and finding the best from the lot can be difficult. To help you in this regard, we have listed some of the best cloud accounting tools that many small and medium businesses use in the UK. Have a look at them and find the one that suits your business needs.

Top Cloud Accounting Tools For Small And Medium Businesses

  • QuickBooks Online

  • FreshBooks

  • Zoho Books

  • Sage Online

  • FreeAgent 

  • Xero

QuickBooks Online



QuickBooks Online is considered one of the best cloud accounting software for small businesses that are looking to automate their accounting tasks. The tool is loaded with features that include tax calculation, invoice management, payroll management, and other advanced features. 

It is one of the first software to move to the cloud and one of the most advanced. This means you can track your business finances from any place with any device. If you have a PC/Mac, you can use the web browser to use the software. On your tablet/mobile, you can access it through apps.

When it comes to the safety of the data, the software doesn’t disappoint you. It employs the highest industry-recognised safety standards, ensuring that your accounting data doesn’t get compromised. 

QuickBooks Key Features

  • Comes with excellent TAX planning support. This includes providing real-time income tax estimates. In addition to this, it enables the filing of VAT returns directly to HMRC from the application itself and is MTD compliant.

  • You can connect your business bank accounts to the application so that you can keep track of the money coming and going out of the accounts.

  • It comes with a cloud-based payroll solution that takes care of payslips, pensions, and other payroll tasks. You can use this feature by paying an extra fee.

  • Track your business finances using 150 easy-to-use dashboards and reports.

Pros

  • Easy to use.

  • Excellent tax-planning support.

Cons

Support options depend on the plans.

FreshBooks

FreshBooks is another excellent SME-focused accounting software. Many small businesses in the UK are increasingly using this tool because of its great design and powerful features. Its invoice creation and expenses management features are the best among the other accounting applications. 

Plus, it also has an outstanding UI that is colourful, clear, and user-friendly. Also, FreshBooks allows the customization of financial documents that will help in promoting your brand and services.

FreshBooks Key Features

  • It has the best invoice creation tool. You can add images like the company logo, edit a preview of an invoice directly, and use a wide range of customisation options. All this will help you to generate an invoice effortlessly.

  • Its expense creation feature also stands out. It is very user-friendly, intuitive, and colourful. The expenses summary screen is attractive. They come with coloured bars that categorise the recently updated expenses. Plus, adding expenses is also very easy.

  • Comes with smart double-entry accounting tools. These tools identify revenue items and their expenses and then provide accurate profit and loss figures.

  • Comes with an automatic expense tracking feature. You can track all your expenses in real time. By connecting your bank accounts to the FreshBooks application, all your spending will be automatically updated in the application.

Pros

  • Excellent invoice and expense creation features.

  • Attractive and extremely user-friendly.

Cons

Each plan has client limits.

Zoho Books

Zoho Books is an online cloud accounting software for businesses of all types, whether it is small, medium, or big. It is loaded with a suite of features that include invoice generation, tracking expenses, integration with other apps, and more. 

Its depth in bookkeeping areas like time and project tracking, sales & purchase, and inventory management is more advanced than its competitors. Apart from this, it comes with a wide selection of helpful resources. Helpful resources are very much important for accounting.

Zoho Books Key Features

  • Superb for time tracking. It allows you to keep a track of the time you are spending on a particular project and the client, and then you can use these minutes to turn them into billable invoices.

  • It comes with an excellent inventory and stock management feature. Using this, you can know the status of the stock. Plus, you can also create customised rates for the items for special customers.

  • It can integrate with a wide range of apps. You can integrate Zoho Books with payment gateways, Zoho CRM, Zoho apps, POS apps, PayPal, G Suite, and many others.

  • You can automate invoice generation by using recurring templates.

Pros

  • Comes with plenty of customer support manuals and guides.

  • Includes complex features like time tracking and project billing.

  • Offers a free plan to micro-small businesses.

Cons

Has a big learning curve.

Sage Business Cloud Accounting

It provides complete automation solutions for bookkeeping and invoicing. You can generate and send quotes and invoices, track expenses, and get insights into where the business’s financial standing is at.

Sage Business Cloud Accounting Key Features

  • Offers complete accounting automation from billing, Accounts Payable & Accounts Receivable management, and invoicing, to tracking expenses.

  • You can get detailed reports on inventory, expenses, and others.

  • It allows you to invite an unlimited number of users for collaboration. This is not possible with other cloud accounting applications. These applications only allow a limited number of users per pricing plan.

  • Monitoring your company’s finances is easy with Sage. It provides a single dashboard to monitor your company’s financial status.

Pros

  • Powerful features.

  • 24/7 customer support.

  • Enables you to connect with other apps.

Cons

  • Outdated user interface.

  • Reports lack visual effects.

FreeAgent

FreeAgent cloud accounting software caters to small businesses and freelancers. It has all the basic accounting capabilities like project management, international invoicing, inventory management, and more. For UK small businesses, it also provides VAT support and is MTD comliant.

Before there were limited features for private limited companies, but now they have added many features including corporation tax and PAYE.

FreeAgent Key Features

  • FreeAgent Radar alerts you on unpaid invoices, and upcoming deadlines, and provides insights on which clients are paying invoices quickly.

  • It provides eight unique invoice templates to which you can add your company logo.

  • It automatically generates VAT returns. With a single click, you can submit the returns from the app.

  • You can file your self-assessment tax directly from the application.

Pros

  • Customised invoice generation.

  • Friendly user interface.

Cons

Reporting features are limited.

XERO

Xero is a New Zealand based company offering cloud based accounting software for small to medium sized businesses in over 100 countries.

After coming into the UK market and after heavy marketing, we can safely say it is the number one solution in the UK. It is very popular with accountants because of the extensive reporting features, easy bank reconciliations and constant software developments. We in particular like the bank reconciliation on Xero which can be done by most business owners after less than an hour of training.

Xero key Features

  • A lot of automation features – can automate bank reconciliation and accounts receivable tasks.

  • A lot of functionality and reporting features.

  • It automatically generates VAT returns and is MTD compliant.

  • Multi-currency and payroll features.

Pros

  • A lot of functionality.

  • Friendly user interface.

Cons

It can be overwhelming for new business owners because of the number of functions and it is pricier than some other solutions in this blog.

To Sum Up

Cloud accounting software is the need of the hour for every small and medium business to efficiently manage its finances. It frees you up with the accounting tasks and lets you concentrate on growing your customers. For that to happen, you need the right tool that is loaded with a wide range of features. In this blog, we put forward the best cloud accounting softwares loaded with excellent features that are widely used in the UK.