Best self-employed accounting software

Regardless of size and type of business, everyone has their finance and accounting needs; some are simpler while others are complex. Being self-employed means, you are responsible for your business and accounting software can fulfil your bookkeeping, payroll, compliance management, and other accounting needs.

Though you can reclaim the charges of hiring an accountant or outsourcing on the tax return forms, self-employed accounting software is a cheaper alternative. Moreover, the use of accounting software progressed after the Making Tax Digital plan of the HMRC in April 2019.

This blog will cover accounting software, including,

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Why do self-employed individuals need accounting software?

Digitisation has stepped in almost every sector, and the accounting industry is not behind in adopting them. With the use of accounting software, self-employed individuals have been beneficial in several ways:

  • Save time in dealing with business financials, including recording transactions, balancing books and other accounting needs.
  • Draw valuable insights through data analysis and reporting.
  • Streamlining the invoicing process with free templates available within the software.
  • Offering flexibility in work arrangements and reducing paperwork.
  • Eliminating human errors and offering more accurate reports.
  • Making collaboration easier.
  • Improving the accessibility of financial information to business owners anytime, anywhere.
  • Reducing business overheads for employing in-house accountants and providing them employee benefits plus salaries.

Using the accounting software is advisable for self-employed individuals as they already have many tasks. They attempt to manage administrative functions while focusing on business operations, and completing daily accounting needs becomes hectic.

8 best self-employed accounting software

1. QuickBooks

QuickBooks is one of the top-notch accounting software for small businesses. This platform has everything a self-employed or sole trader needs for business accounting, like tracking expenses, tax obligations, meeting government regulations, automatically generating tax returns, etc.

The packages start from just £12 per month, and initially, you get a 30-day free trial. Therefore, using QuickBooks is cost-effective.

2. Xero

Xero is a major player in the field of cloud accounting software. It has a user-friendly interface; however, Xero is best for sole traders with good accounting skills. The accounting software fully integrates with third-party payroll services and collects payments online from customers through Xero’s integrations.

Xero’s starter pack comes at £12 per month, excluding VAT. It includes creating 20 invoices and quotes, entering 5 bills, reconciling Bank transactions, submitting VAT returns directly to HMRC, automatically calculating Construction Industry Scheme deductions, and capturing bills and receipts using Hubdoc.

3. QuickFile

QuickFile has a great score on Trustpilot and is excellent accounting software for freelancers, enterprises and small businesses. It is cloud-based accounting software that assists you in automatically importing transactions by connecting you to 50 banks in the UK and 300+ other web services.

This application allows you to take images and upload receipts, offers premium online portal clients to pay their invoices, supports multiple currencies, and files VAT returns directly with HMRC.

You can avail of their free services by keeping your ledger entries less than 1,000 per year and being ready to watch ads. Otherwise, pay for their ad-free premium services.

4. FreshBooks

FreshBooks is one of the most recommended self-employed accounting software that offers plenty of client management features, from time tracking to easy invoicing and all other accounting needs to run a business.

However, it offers more than accounting needs like seamless integration, Bank reconciliation, keeping your bookkeeping up to date and your taxes in order.

5. Wave

Wave accounting software has a customer base of over 2 million and is famous for its free services among freelancers, sole traders and small businesses. It offers complete accounting solutions from invoicing and receipt tracking, financial reporting, scanning receipts, income and expense tracking, and so on.

The premium services include customer payment processing and payroll. The pay-per-use policy for online payments of Wave includes payment on every transaction you make via the application. Therefore, it is advisable for businesses with high sales volume.

6. Zoho Books

Zoho Books is a highly recommendable software for sole traders and small businesses and is famous for its CRM software and business tools. However, to use the software, you need good accounting skills.

Though it is difficult to use, small business owners looking for an all-in-one solution with easy-to-integrate CRM can get Zoho Books for their business.

7. Sage Business Cloud Accounting

The Sage Business Cloud Accounting software is the best option for owners with less confidence in accounting practices. The base package starts at £12 per month, excluding VAT, and assists you in creating and sending invoices, tracking your debts, reconciling bank accounts, and completing and submitting MTD VAT reports directly to HMRC.

However, with a standard package of £24 per month, excluding VAT, you can run advanced financial reports, send quotes and estimates, forecast cash flow, manage purchase invoices, and calculate Construction Industry Scheme deductions.

Sage provides 24×7 customer support via phone, live chat, and tons of comprehensive instructional videos and online guides.

8. Crunch

Crunch. is cost-effective online accounting software that saves you time and money. This starter pack is free and includes simple accounting services for self-employed people. For sole traders, at £12.25 per month plus VAT, you get software that provides ongoing accountancy support and tax returns.

They have a 5-star rating on Google and Trustpilot and have HMRC recognition for Making Tax Digital. If you want to look for experts, they provide you with accountants, payroll export, VAT specialist, lawyers and other experts to help you with any questions.

How to choose the best accounting software?

Know your needs

Before comparing accounting software packages, sit back and think about how to use the software and what functions you need. Listing down your priorities will help you evaluate packages and find the best software for your business. It may include:

  • What are your business objectives?
  • Who will use the software?
  • What information is essential to running your business?
  • What bookkeeping and accounting tasks do you need to perform?
  • What special requirements do you have?

Check for compliance

The software you choose should be simple and easy to use, plus deliver a high level of compliance. That means you must consider:

  • Whether the software provides an audit trail
  • Whether the software manages backups

Easy to use

The best accounting software for self-employed individuals must be intuitive and easy to use. Look into some of these factors:

  • How easily can you get started with the software?
  • Is the usage of the software easy?
  • Do you pay a monthly subscription?
  • Can you cancel your subscription at will or submit a notice?


You must prepare a budget, especially when you are venturing into the business world and are low on budget. Accounting software is available in both free and premium packages. You must select an application containing all the features you want to run your business finances smoothly. You can look for:

  • The built-in banking and accounting features
  • Basic accounting features required in your business
  • Training resources availability
  • Add-on modules
  • Extra services for premium packages, and so on.

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Choosing the best accounting software for business can be tricky, and you need time to consider purchasing one. If you are not ready to invest in hardware and software costs, getting involved in training staff to use the software, updating the software from time to time, outsource your accounting tasks to firms. They charge you for the services you need, and you stay at peace throughout the year.