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Paul Beare

Paul Beare

UK Tax Expert

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Accounting for Taste

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The recent spread of cloud computing has been a serious boon to small businesses, many of which wouldn’t have the time or resources to implement a major accounting software installation.

Instead, over the past decade, the arrival of Xero and QuickBooks to join Sage in the software as a service space has opened up the world of more sophisticated and scalable accounting software to a whole new range of firms. That means that any growing business has access to a broader range of tools to help plan their growth and make record keeping and accounting a much less stressful process. And,working with the right accountant can help make sure you make the best decision.

Before you start the process of choosing your online accounting software package consider running through this basic checklist to get a better idea of which package will suit you best.

  • What are the basic requirements you need from an accounting software package,
  • What are the most relevant products within the ranges for your business,
  • Have you considered trialling each product?
  • What about taking an online training course to play around with the practice data yourself,
  • Ask your accountant – before choosing a software, go through the pros and cons specific to your business with your accountant to help decide on the most suitable package. They will also help you with the software setup.

All three of the leading playersoffer a full range of software services to help businesses keep track of their finances, plan their budgets, report their tax position and deal with payroll. But which one suits you best?


Sage was the first of the online accounting software providers and has been chosen by SMEs for over two decades. While it’s growing its business base, Sage is designed more for the professional bookkeeper or accountant in mind; however, many clients successfully use Sage themselves. As well as accounting, Sage can also help keep employees on-task when working on collaborative projects.

QuickBooks is designed using a process flow so can be more attractive for the business person with no accounts experience. However, this can still look a little complicated for some clients as QuickBooks offers powerful accounting and bookkeeping tools.

With the launch of QuickBooks Online, offshoot from the original has a monthly subscription charge, rather than a hefty upfront fee. It’s also cloud-based and designed for use on the move, so you can access it from your laptop,smartphoneor other mobile device.

Launched in New Zealand in 2006, Xero has become one of the top accounting tools on the market. It has over 2.7 million subscribers¹ across a number of countries, including the UK, Australia and New Zealand.

This all-in-one accounting software is particularly popular with startups and younger business owners, and is known for its clean, uncluttered interface.

Xero suits businesses that need more than five users and self-employed people who don’t need to send out more than 20 invoices per year.

The price is right?

Xero pricing

Xero only has three price plans compared to QuickBooks’ four. The Starter package costs £1 and is good for sole traders, new businesses, and the self-employed, allowing users to:

  • Send quotes and 20 invoices†
  • Enter 5 bills
  • Reconcile bank transactions
  • Submit VAT returns to HMRC
  • Capture bills and receipts with Hub doc
  • Automatic CIS calculations and reports

Xero’s most popular plan is the Standard package that costs £30 per month and is good for growing small businesses.IT offers everything Starter as well as the ability to bulk reconcile transactions and get short-term cash flow and business snapshot

Finally, Premium, at£ 35, offers all of the above but also the ability to use multiple currencies, making it good for established businesses of all sizes.

QuickBooks Pricing

The three main packages for SMEs are as follows:

Simple Start: For sole traders or small businesses who need to manage VAT and Income Tax.


Essentials: For small businesses working with suppliers. Manage VAT and Income Tax with up to 3 users.


Plus:For businesses managing projects, stock, VAT and Income Tax. Up to 5 users.

£15/mo(50% off for 4 months then £30/mo)

Sage pricing

Meanwhile Sage has three SME packages: Start, Standard and Plus. Start, at £12 a month lets you create and send invoices, track what you’re owed, calculate and submit VAT as well as offering automatic bank reconciliation, and helping you get ‘Making Tax Digital’ Ready for VAT. But this only supports one user

Standard, meanwhile, offers all of the above, as well as helping you manage and submit CIS, run advanced reports, send quotes and estimates, forecast cash flow, manage purchase invoices, snap receipts with AutoEntry, 2 months free. This supports unlimited users

Lastly, users paying £30 a month for Plus will get all of the above, but also receive multi-currency banking and invoicing and the ability to manage inventory.

Ultimately, the right package will depend on what your business needs and where it is in its growth journey. Talk to your accountant about the best system for you.

At Paul Beare Ltd we help our clients navigate this and a whole range of issues. If you need help, you can contact us for help rom tax and payroll to accounting and banking.

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