Medium-sized business owners face a unique challenge: they’re growing, but still need help to avoid stagnation. The UK’s Making Tax Digital (MTD) rollout, led by HMRC, has forced many business owners to change their accounting processes.
However, many accounting software providers cater to small businesses, sole traders, and freelancers, leaving medium-sized business owners to sift through figures and make their own judgments.
Best UK Medium-Sized Business Accounting Software
To help medium-sized business owners decide, the best UK accounting software packages have been reviewed. Every business is different, and while smaller businesses can make do with basic functions like invoicing and financial report generation, some slighter bigger businesses might need more.
Most UK small business accounting software offers similar features, but the design and cost can vary. When choosing accounting software, business owners should make a list of their bookkeeping and accounting needs, including inventory tracking, purchase ordering, and foreign currency transactions.
Free accounting tools can be a practical solution for straightforward needs, but they may not have the features to accommodate growing businesses. Some providers limit the number of invoices that can be sent or charge extra for VAT filing and reporting.
Business owners should also factor in transaction fees, additional users, and the cost of upgrading as their business grows. The rise of monthly subscription models, such as Software-as-a-Service (SaaS), means that technology is always up to date, but the downside is that the monthly costs can add up over time.
When selecting an accounting software supplier, business owners should ask about customer support, similar clients, and foreign currency payment support. They should also choose a solution that can grow with their business, rather than buying a basic license that may become outdated within a year.
Read Also: UK sole traders face new digital tax filing rules
Sage is a suitable option for scaling businesses, with tools for cash flow, VAT, payroll, expenses, and financial reporting. Its AI-powered tools can take on much of the workload, and it offers three cloud-based accounting plans, from Start to Plus, with features like inventory management and multi-currency accounting.
Xero is another option, allowing businesses to send invoices, reconcile bank transactions, track bills and expenses, manage payroll, and generate financial reports. It integrates with over 1,000 apps, including ecommerce platforms and inventory management tools, making it easy to share data across different business functions.
Both Sage and Xero offer discounts for new customers, with 90% off for the first six months. Sage plans start at £2 per month for the first six months, while Xero plans start at £2.30 per month for the first six months.
In terms of specific features, Sage offers a broad range of accounting features, including VAT calculation and submission, cash flow forecasting, and custom financial reports. Xero, on the other hand, offers extensive integrations with other business apps, as well as decent reporting and financial management features.
The cost of these solutions can vary, with Sage offering three cloud-based accounting plans, from Start to Plus, and Xero offering several plans.
Sage and Xero both offer free trials, allowing business owners to test their software before committing to a plan.
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