The Best Basic Accounting Software for UK Businesses

Our top pick for a basic accounting system is ZohoBooks. It was the easiest accounting platform to use in our testing, and it comes with great tools for tracking sales and inventory.

The best basic accounting software helps small businesses and the self-employed stay on top of day-to-day bookkeeping, and prepare for tax season.

They’re also easy to use, and don’t require you to be an accounting expert to complete basic tasks. This means clear menus that aren’t full of jargon, intuitive design for invoices and quotes, and up-to-date knowledge centres for quick self-help.

The Best Basic Accounting Software At a Glance

Here’s a quick side-by-side comparison of the best basic accounting software:

1. ZohoBooks: Best for Easy Sales and Inventory Management

Not only was ZohoBooks the easiest-to-use accounting software that we tested, but it also comes with plenty of helpful features to help businesses simplify daily operations, such as simple invoice creation and inventory tracking.

Why we like ZohoBooks

ZohoBooks is designed to make accounting easy for non-experts, which is why it’s our top pick for basic accounting software. This is reflected in the platform’s intuitive design, with its well-signposted sidebar menu and dropdowns, and in the familiar email-inspired layout of quotes and invoices.

It’s particularly well suited to businesses that need a basic accounting tool for managing sales and inventory since features like a dedicated reminder button for late invoice payments, real-time inventory tracking, and mileage calculation for expenses speed up day-to-day bookkeeping. Not all of ZohoBooks’s competitors offer these tools. For example, Sage doesn’t have a payment reminder button, and many platforms we tested, including QuickBooks, don’t calculate mileage.

ZohoBooks also has some excellent reporting and analytics tools. Like all good accounting software, it comes with prebuilt templates for key financial statements such as income statements, cash flow statements, and balance sheets. On top of that, it has some extra tools, such as calculating the depreciation of fixed assets, great for businesses that manage products. This last feature isn’t offered by competitors QuickBooks or FreshBooks.

Adding to its appeal, along with FreeAgent, ZohoBooks is the only provider to offer a free plan, and it has a low starting price of £10 per month for its paid plans. This makes it accessible for sole traders or micro businesses. It also has one of the best mobile accounting apps of any provider we tested, which allows businesses to manage almost all aspects of accounting on the go. Most competitors’ mobile apps have restrictions on payments and access to reports.

Where ZohoBooks could improve

On downside to ZohoBooks is that its transaction fees are a little high. You’ll pay a 2% fee on the transaction amount, plus 18% GST (goods and services tax) on the 2% fee for domestic UK cards. Cheaper fees are available with Sage (1.99%).

ZohoBooks also only offers live support from 9 am to 6 pm on weekdays, which isn’t ideal if you plan on working on accounting outside of these hours. FreshBooks is a great alternative since its lines are open until 12 am all days of the week.

It’s also not a good option for businesses that aren’t interested in using Zoho’s other business software products, since ZohoBooks only integrates with around 12 third-party software tools. If you already use software and want to keep it, we recommend competitors QuickBooks or Xero, which integrate with 750 and 1,000 apps.

Lastly, although ZohoBooks was the most user-friendly platform we tested, we did encounter a few usability issues when testing it. For example, ZohoBooks’ timer didn’t let us assign the time to a new project upon stopping the timer (this had to have been done before). Additionally, ZohoBooks’ search bar required an exact match to show results, which meant it was hard to use it to locate new features.

2. FreshBooks: Best for New Businesses

FreshBooks has great customer support, with lines open on weekends, is easy to use, and is relatively affordable, with pricing starting at an average of just £25 per month. This makes it a great basic account software solution for startups or new businesses that need help navigating their finances.

Why we like FreshBooks

We found FreshBooks very easy to use. In fact, it ranked second place for usability, after ZohoBooks. Factors that contributed to this included FreshBooks’ smart vertical navigation menu, which was well organised and clearly signposted key features.

We were also very impressed by FreshBooks’ quotes and invoice tools, since we could edit settings directly on the page we were working on, instead of going to a separate page, as was the case with competitors. Converting quotes into invoices was also very straightforward thanks to a dedicated button.

In general, key tools or data were displayed in very obvious places, so we didn’t have to do much digging to find them. For example, the client dashboard displayed clients with outstanding payments, making it easy to see late payments.

FreshBooks also has some of the most available customer service of any provider we researched, with a phone line that’s open until 12 am even on weekends and a 24/7 chatbot. By contrast, many competitors only operate on weekdays, making it harder to access support outside of regular hours. FreshBooks’ knowledge centre was also very well stocked with guides covering a wide range of topics. This wasn’t always the case, with Xero and ClearBooks’ knowledge centers lacking guides on a lot of topics.

Finally, FreshBooks is an accessible software, since it has an average cost of £25 per month, the second cheapest average cost after FreeAgent’s £22.50. You’ll pay a maximum of £35 with FreshBooks, much less than Xero, ZohoBooks, or QuickBooks, plus, there’s only a £10 increase between tiers.

Where FreshBooks could improve

While FreshBooks offers a mobile app, it doesn’t let businesses view reports or process transactions on the go, so it can’t be used for full on-the-go accounting. A better option is ZohoBooks, which has the most comprehensive mobile app. It’s also not possible to create multi-currency invoices with FreshBooks, whereas most other competitors offer this option. So, if you have international clients, it’s not the best choice.

Addiotionally, FreshBooks doesn’t have a great selection of tools for financial planning. For example, it’s missing any type of cashflow projection or budget-setting tools. Businesses who need these tools should look to QuickBooks or Xero.

On the usability side, the main task we had trouble with when testing FreshBooks was its emailing tool. There was no button specifically for writing messages to clients, so we weren’t sure how to send personalised payment reminders or confirmations. It was also easy to send items by accident, since there was little warning when hitting send.

3. FreeAgent: Best for Businesses on a Budget

Qualifying businesses can access any of FreeAgent’s plans for free, and those that don’t benefit from lower than average paid plans, making FreeAgent a great choice for budget-conscious businesses that just want a lightweight, simple platform for managing their accounts. It also offers tax timeline and scenario prediction features which can help businesses stay on track.

Why we like FreeAgent

Businesses that have a business bank account with Natwest, Mettle, Royal Bank of Scotland, and Ulster can get any FreeAgent accounting software plan for free, making the cheapest accounting software for qualifying businesses. If not, FreeAgent still costs less than competitors. Its maximum cost is £33 per month, much less than ZohoBooks’ £165 and QuickBooks’ £115.

FreeAgent has more to offer than just a low cost, it was one of the most user-friendly accounting software we tested. Its navigation was intuitive thanks to clear signposting, and it simplified complex financial tasks with clear guidance throughout.

For example, the invoicing tool had a timeline feature that guided us through the process, and users get access to tax reminders and pre-built end-of-year reports. All these features make FreeAgent a great basic accounting software for those new to accounting.

FreeAgent also offers excellent reporting tools for a low price. The platform has built-in tools for tax forecasting and planning, the only provider on this list to offer this. Businesses also get alerts about potential cash shortfalls or surpluses, and can run “what-if” scenarios to better plan for the future. Competitors Xero, FreshBooks, and Sage don’t offer these tools, and they’re a paid add-on with QuickBooks.

Where FreeAgent could improve

FreeAgent was one of the few platforms we tested that didn’t suggest frequently used entries when we were typing data into fields, which slowed down the speed at which we worked. If efficiency is what you need, we suggest QuickBooks or Xero as alternatives.

Unlike QuickBooks and ZohoBooks, businesses also can’t assign multiple delivery addresses to clients in FreeAgent. This means it’s not the best option for businesses that regularly ship products to clients, or work with organisations that are spread out geographically. It’s also not possible to assign multiple shipping addresses to clients in FreeAgent.

When it comes to usability, although we found FreeAgent quite easy to use overall, there were a few sticking points. For example, we had trouble finding features such as payment reminders and customisation options for invoices because of vague menu signposting.  FreeAgent’s search bar also didn’t produce any results when we tried using it to help us find tools.

4. QuickBooks: Best for Financial Insights and Reporting

QuickBooks impressed us with its handy design for speeding up basic everyday accounting tasks, and its extensive reporting and analytics tools, such as powerful cash flow projections. It’s a great accounting software for data-minded businesses.

Why we like QuickBooks

QuickBooks wasn’t quite as easy to use as other platforms, but it still has a well-organised layout and a great set of basic accounting tools.

When testing, we found that QuickBooks was particularly great at reducing manual effort for basic accounting tasks. For example, when populating data fields, the platform suggested prompts from previous entries. This isn’t something competitor FreeAgent does, and it slowed down our work.

Converting quotes into invoices was particularly seamless thanks to a dedicated button, and we were able to send payment reminders directly from the overdue section, we appreciated the email previews to verify the layout before sending off a quote or invoice to customers.

Where QuickBooks excels is when it comes to reporting and financial analysis tools. Like ZohoBooks, it of course comes with prebuilt templates for key financial statements, but it also allows businesses to create completely custom reports from scratch, something ZohoBooks doesn’t do. We also loved QuickBooks’ data dashboard, which highlighted key stats, such as overdue payments, in the form of graphs. Other providers offer similar dashboards, but QuickBooks’ version was the easiest to read, and most comprehensive.

Going beyond the basics, QuickBooks’ cash flow projection tool was the best we tested. Besides providing clear estimates, it also alerts businesses about potential cash shortfalls or surpluses. Xero’s cash flow projector doesn’t do this.

Where QuickBooks could improve

One of QuickBooks’ biggest faults is that it’s missing a basic accounting tool, time tracking software. Besides Sage, QuickBooks is the only platform we tested to not have this tool, which could cause issues for small businesses looking to better manage time spent on accounting or professionals who need to create billable hours.

Additionally, we found that QuickBooks has a steep learning curve. It wasn’t the most difficult to use of all the platforms we tested, but its cluttered interface and some vague signposting definitely slowed us down when we first started using it. Perhaps the most frustrating aspect of using QuickBooks is that key tasks, like creating expenses, setting tax rates, and sending payment reminders, require far more steps than with competitors.

If you don’t have much time to dedicate to learning how to use your new accounting software, we recommend ZohoBooks, FreshBooks or FreeAgent instead, since they were the top three most user-friendly accounting platforms we tested.

5. Clear Books: Best for Tax Support

ClearBooks makes submitting tax returns easy thanks to its Tax Projection tool, which allows users to plan for upcoming payments. The platform also automatically updates in line with new tax regulations, and supports a wide variety of different tax types.

Why we like Clear Books

ClearBooks’ features weren’t as advanced as its competitors, but it’s still a great basic software tool for small businesses, particularly those anxious about tax, since it offers excellent support.

It’s the only software on this list to have a “Tax Projection” tool, which can help small businesses plan for upcoming payments and stay compliant. Along those same lines, Clear Books’ software automatically updates when tax regulations change, whereas most competitors just offer a warning notification.

Like all good accounting software tools, Clear Books automatically calculates and deducts tax on products or services, but it stands out as supporting the widest variety of tax types out of all competitors. Businesses can manage VAT, income, sales, and GST. If your business operates internationally, where different tax codes are used, this is a big advantage.

Clear Books is also part of the Making Tax Digital (MTD) initiative, so users can submit tax returns to HMRC via Clear Books’ portal, and get access to all the necessary pre-built templates. Most competitors do offer this as well, but Clear Books offers more guidance on this topic, making it a good option for first-timers.

We also enjoyed using Clear Books’ search tool, which produced a variety of results, something most competitors’ search tools didn’t do. Plus, Clear Books had a pop-up project creation feature, which made it extremely easy to classify different tasks, and isn’t something competitors offer.

Where Clear Books could improve

Like FreshBooks, Clear Books doesn’t offer many tools to help businesses with financial planning. It’s missing cash flow projections and a tool for creating budgets, and it’s one of the few providers on this list that doesn’t offer custom reporting. QuickBooks or Xero are great alternatives for businesses that need solid reporting and analytics features.

Additionally, Clear Books, along with FreeAgent, is the only provider on this list to not show businesses the status of an invoice, such as if it’s been opened by a client. This won’t be an issue for all businesses, but it is a useful tool for predicting when payments are likely to be made.

Clear Books also scored quite poorly when it comes to usability. We found its navigation bar quite confusing owing to a few naming inconsistencies. The overall layout of the dashboard was also quite cluttered, making it hard to find the features we were looking for.

6. Sage: Best for Customisation and Branding

Sage offers customisable reporting and branding tools like themes and logos. On top of this, it has native payroll and HR software, making it a great option for businesses that want to streamline their admin.

Why we like Sage

When testing Sage, we were impressed by its modern interface, which was also quite easy to navigate.

The tools that stood out to us most were Sage’s quoting and invoicing workflows, especially because of how easily customisable the templates were for invoices. We were able to change layouts, and position logos exactly where we wanted instead of in an imposed spot, as was the case with competitors.

On top of this, Sage offers different templates for products and services, ensuring appropriate design for each, and we were able to seamlessly switch between templates.

Sage also affords businesses a high level of customisation when it comes to reporting. You can create custom reports, and there’s a dedicated menu tab for viewing profit and loss reporting, a core report for most businesses. Like QuickBooks, Sage also offers users an attractive dashboard that summarises key metrics, such as outstanding payments, and it’s also one of the few accounting software platforms with a cash flow projection tool.

Part of what makes Sage an attractive option for businesses is also the fact that it offers other businesses software, notably payroll and HR, on top of accounting. This enables businesses to easily integrate the two systems, and reduces training times since the layout is similar across the same providers.

Sage isn’t alone in offering a native payroll tool. QuickBooks also offers one, however, we think Sage’s is slightly better since it offers tiered payroll software plans that can accommodate growing teams.

Where Sage could improve

Like QuickBooks, Sage is missing a basic accounting tool, time-tracking. On top of this, its journal entries don’t integrate with the general ledger, so it’s not an option we’d recommend to accounting professionals. Sage is also the only software on this list to not have a tool for sending automatic client payment reminders, so we don’t recommend it to businesses with a large client portfolio.

On the usability side, we had trouble finding certain tools in Sage, such as payment reminders, currency settings, and expense reporting, due to vague menu signposting. Sage’s self-help resources were also very unclear, and didn’t cover all core topics, so it’s not the best option for DIY learning.

7. Xero: Best for Established Businesses with Long-term Clients

Xero is a solid choice for established businesses with long-term clients that need a secure client portal and comprehensive financial tools to ensure long-term visibility.

Why we like Xero

Xero was the most challenging to use of all the accounting software we tested, however, we were particularly impressed by the amount of detail Xero allowed us to add to quotes, invoices, and expenses.

For example, for expenses, we were able to upload receipt images, log mileage, and link expenses to clients very easily. This last function isn’t something competitors offer. In quotes and invoices, we could also include unique IDs and a wide variety of tax codes. All these factors contribute to making Xero great accounting software for businesses with a large portfolio of clients to keep track of.

Xero also has an excellent client portal, called the Xero Portal. Besides ZohoBooks, Xero clients can securely view or interact with their financial data, which is a great way to stay transparent and maintain trust. Xero also integrates with over 1,000 third-party apps, the most of any provider on this list, so it’s more likely to meet the needs of established businesses that already use a variety of business software.

Xero also has some great reporting and analysis tools, to help businesses maintain long-term visibility over their finances. Its cashflow tool is a close second to QuickBooks’, and Xero has tools to track fixed assets and their depreciation and/or amortisation over time. It’s only missing alerts for shortfalls and surpluses, which QuickBooks offers.

You’ll also find all the pre-built templates you need for common financial statements, and be able to generate custom reports to perfectly match your business’s needs.

Where Xero could improve

At £16 per month, Xero also has the highest starting price of all the platforms on this list. If you’re looking for a basic accounting software that’s also affordable, we recommend FreeAgent or ZohoBooks, which both have free plans and a starting price of £10 per month, the lowest on this list.

Xero also performed quite poorly when it comes to usability. We found its dashboard quite overcrowded, and the vague names for menu tabs made it hard to guess where common tools were. We also didn’t like the fact that extraneous fields came before core details when creating quotes and invoices. Because of this, it’s not a platform we’d recommend to beginners, who would do better with FreshBooks, or ZohoBooks.

Basic Accounting Features: What Are The Most Important Ones?

The basic features all accounting software should have:

• Invoicing and quoting: Create quotes and invoices and send them to clients and contacts via email.
• Bill and expenses management: Keep track of your outgoing, and ideally assign them to categories.
• Tax preparation: Calculate taxes on products and services, and use forms for tax returns and filings.
• Journal entry: Document all transactions, remember item codes, and sync with the General Ledger.
• Time tracking: Track time spent on work or projects to create billable hours for clients or refine workflows.
• Payment processing: Connect with banks and payment processing services, and generate payment links.
• Reporting: Reports on profits and loss, cash flow, and balance at the minimum, but most software offer more advanced tools.
• Integrations: Integrate with other business software, whether third-party or from the same provider.

Most of the accounting software on this list can do more than just the basic tasks listed above, however, these features should serve as your baseline when choosing accounting software.

Methodology: How We Test Accounting Software