Which accounting software should I use for a small business?

The right accounting software should save you time, reduce errors and provide valuable insights into your organisation’s financial health.

But with so many options available, how do you decide which one is best suited for your needs?

This guide aims to simplify the process by exploring the benefits of cloud accounting software for small businesses and key features to look for in online accounting solutions.

Why small businesses should consider cloud accounting software

Cloud-based accounting software is the go-to choice for small businesses. Unlike previous generations of accounting systems, which require cumbersome installations and manual updates, cloud accounting solutions offer modern, efficient tools with a range of benefits:

Flexibility and accessibility
Cloud solutions allow you to access your accounts anytime, anywhere with an internet connection. Whether you're in the office, at home, or on the go, you can stay on top of your finances in real-time.

Cost-effectiveness
Many cloud accounting platforms use a subscription model, eliminating the upfront costs of software installation and ongoing maintenance.

Automation of routine tasks
Features like automated invoicing, bank reconciliation and tax calculations save time and reduce errors.

Secure data storage
With robust encryption and regular backups, cloud-based accounting programs ensure your financial data is safe and protected.

Scalability
Many cloud systems grow with your business, allowing you to add features as your needs evolve.

These benefits make cloud accounting software particularly appealing to small businesses operating with limited time and resources.

Key features to look for in accounting software

When choosing online accounting software, look for solutions that match your business size, industry, and specific needs. Here’s a checklist of features to consider:

Ease of use
Small business owners often wear multiple hats, so your accounting software should have an intuitive interface that’s easy to learn and use.

Core capabilities
At a minimum, your software should include invoicing, expense tracking, financial reporting and VAT handling to meet UK requirements.

Integration options
Seamless integration with other tools such as CRM systems, payroll software and payment platforms can streamline your operations.

Support for cloud access
Choose a system with mobile apps or browser-based access to stay connected even when you're out of the office.

Scalability
Even if your business is small today, you’ll want software that can handle growth without expensive upgrades or system changes.

Cost transparency
Look for solutions with clear, predictable pricing. Avoid hidden fees for additional users or features.

Popular cloud-based accounting options for small businesses

Here are a few entry-level options to explore when researching the best accounting software for a small or micro-business:

Xero: A popular choice with a focus on simplicity and comprehensive reporting.

QuickBooks Online: Well-suited for entrepreneurs needing integrated payroll and tax planning tools.

FreeAgent: Designed for freelancers and small business owners, with UK-centric features including Making Tax Digital compliance.

Each of these options offers the benefits of cloud accounting software while catering to different types of small businesses.

However, organisations that need more advanced functionality, that consist of multiple entities or have higher transaction volumes might face the prospect of outgrowing entry-level systems and may want to consider a product designed for midmarket organisations.

When it’s time to look beyond “small business” solutions

If your business is growing and you've found that starter cloud and desktop systems can't keep up, it might be time to consider solutions designed for medium-sized businesses.

Systems like iplicit offer enhanced functionality, greater integration capabilities, and advanced reporting tools ideal for businesses transitioning from small to medium scale.

iplicit is among the systems providing an excellent pathway for those anticipating higher demands in the near future.

Final thoughts

Choosing the right accounting software depends on your current needs, future goals, and operational requirements. For small businesses, cloud-based accounting programs deliver time-saving features, flexibility, and security while remaining cost-effective.

By exploring options carefully, you’ll find a solution that empowers you to focus more on growing your business and less on managing your accounts.

If you’re planning for the future and your business demands are scaling up, iplicit stands ready with powerful tools designed for organisations seeking something more advanced – but without a big step up to enterprise-level complexity and cost.

Take the time to evaluate your options and don’t hesitate to try a few platforms to see which one aligns best with your workflows. The right choice will give you not just numbers but clarity and confidence in every business decision.

Ready to see iplicit in action? Why not take a quick tour?