Best free accounting software for UK small businesses 2024

Our expert researchers found that the best free accounting software in 2024 is Zoho Books. For zero charge, you’re able to access professional features including automated workflows, customised invoices, and the ability to make your own customised VAT returns at the end of each tax year.

As April 2024 approaches, so does the turn of the tax year. This juncture is about making strategic choices for the financial health of your business – which means that now is the opportune moment to set up, or evaluate, your accounting software.

With the current cost of living crisis driving an increase in overhead costs for small businesses, opting for free accounting software is sometimes a smart way to save. In the event that your small business is ready to move on to more powerful software however, you might want to check out our best accounting software picks overall.

While Zoho Books is our favourite, we’ve also picked 5 other free accounting software platforms to help you find the right solution for your small business.

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BEST - FREE TRIAL	BEST - FREE
QuickBooks	Zoho Books	QuickFile	FreeAgent	Wave Accounting	GnuCash	VT Cashbook
Price From £10 per month 90% off for 6 months	Price From Free	Price From Free	Price From Free (for Natwest/RBS business banking customers)	Price From Free	Price From Free	Price From Free
BEST FOR Overall accounting software	BEST FOR Free accounting software	BEST FOR Small businesses that trade overseas	BEST FOR RBS/Natwest customers	BEST FOR Free invoice creation	BEST FOR Businesses that need a desktop solution	BEST FOR Businesses looking for simplicity
Key Benefits Free trial available Self-employed plan Income tax estimate tool Plans have no usage limits	Key Benefits Create and send invoices MTD VAT filing Expenses & mileage tracking	Key Benefits Bank feed integration MTD VAT filing Multi-currency support	Key Benefits Corporation tax forecasting Project tracking Time tracking tools	Key Benefits Personalised invoice creation Powerful business reporting Sort income and expenses into tax categories	Key Benefits Completely free Checkbook-style interface Open-source desktop software	Key Benefits Fast data entry with autocomplete Track multiple bank/cash accounts Produce basic reports

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What is accounting software?

Accounting software is a computer-run program or application designed to manage and streamline financial processes within a business, and used to track financial transactions and generate financial statements, among other accounting-related tasks.

The software can automate many tasks that were originally manual and time-consuming, such as recording sales and purchases, managing accounts payable and receivable, payroll processing, inventory management, budgeting, and generating financial reports.

With accounting software, you should be able to maintain accurate and up-to-date financial records, improve efficiency, reduce errors, and obtain valuable insights into the financial health of your business.

1. 🥇 Best free accounting software – Zoho Books

Zoho Books’ cash flow dashboard

What is Zoho Books?

Zoho made its name with its CRM systems (check out our Zoho CRM review to learn more) but it has offered accounting software since 2011. Zoho Books’ free plan is the best overall choice for free accounting software, though things improve further if you pay out for a premium tier.

It combines a simple and intuitive interface with powerful features that means, even on the free tier, Zoho Books effortlessly handles all the basics.

In short, it’s a great choice for businesses just starting out.

What can Zoho Books do?

On the free tier, Zoho Books offers all this:

• Create, customise and send invoices (up to 1,000 per year)
• MTD VAT filing
• Automated payment reminders
• Expenses & mileage tracking
• Create business reports
• Run an audit trail
• Produce recurring invoices
• Integrate with other Zoho apps and other apps like GSuite, Office 365 and Dropbox
• Email support

What support does Zoho Books offer?

On the Free plan, Zoho gives support via email, while its paid plans add assistance via email, phone, and live chat.

QuickFile on the other hand, which we’ll be reviewing next, primarily offers customer support through email and a community forum. Zoho Books provides a wider range of support options, including live chat and phone support, while QuickFile primarily relies on the forums to provide you with any help you need.

Why is Zoho Books free?

Zoho offers a free plan, but of course, there are drawbacks. For one, it’s limited to 1,000 invoices per year, and lacks a number of features that can make a huge difference to the level of debt in which accounting software can help your small business.

You’ll also be automatically upgraded to a paid plan if your annual turnover exceeds £35,000.

We’ve taken a closer look at how Zoho’s free plan matches up to its £12 per month (+VAT) Standard plan below.

Zoho Books Free vs Standard

While Zoho’s free plan is very useful for businesses just starting out, there are some big reasons you should consider signing up for the Standard plan.

Most notably, the Standard plan lets you create up to 5,000 invoices per year, as opposed to just 1,000 for the Free plan. This means that Zoho Free won’t be suitable for businesses with high transaction volumes, and SMEs with serious growth plans should go for a paid plan.

Another key point is that Zoho Standard comes with bank feed integration – meaning once you’ve linked your business bank account, any transactions you make will automatically appear in Zoho Books. This is opposed to Zoho Free, where you have to download and import bank transactions manually: an annoying and time-consuming task when you’re busy running your business.

On a paid tier, you’ll also be able to create recurring expenses, add up to three users, track project expenses, use a larger number of payment gateways, integrate with other services including Uber and Zendesk, and get support via voice and chat.

So, while the Free plan definitely has its plus points, the extra features and higher limits of Zoho Standard make it a very persuasive option for UK small businesses.

If your business has more complex needs or requires higher limits, Zoho also offers the Professional (£24 per month +VAT) and Premium (£30 per month +VAT) plans.

You can see how all four Zoho Books plans stack up below:

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Plan Free	Plan Standard	Plan Professional	Plan Premium
Cost Free	Cost £10 a month (excl. VAT)	Cost £20 per month (excl. VAT)	Cost £25 per month (excl. VAT)

2. QuickFile

Quickfile’s dashboard for invoicing, banking and important notes

What is QuickFile?

Founded in 2010, QuickFile is accounting software that’s specifically aimed at freelancers, small businesses, and entrepreneurs. It’s a simple and intuitive cloud-based solution that helps any small business owner with little accounting knowledge to easily keep track of their finances.

It’s also got great reviews on Trustpilot, amassing an average score of 4.7 out of 5 from over 1,100 reviews, with reviewers praising its ease of use and range of features.

What can QuickFile do?

QuickFile boasts an enviable range of features, including:

• Integration with over 50 automated bank feeds
• Easily manage invoices through a branded portal, which your clients can use to view and pay invoices through a range of online payment providers like PayPal and Stripe
• Track and file VAT returns – QuickFile is fully compatible with Making Tax Digital
• Generate a range of reports that give insight into your business
• Full multi-currency support
• Tools to create estimates, purchase orders, and delivery notes
• A mobile app that allows you to create invoices/estimates and snap expenses receipts on the go
• A seamless ‘click to print’ service if you need to post hard copies of your invoices, estimates, or statements

QuickFile offers a good range of accounting features, however, compared to other software there are differences in the depth and extent when it comes to certain features, so it all depends on what you need.

FreeAgent, for example, includes features specifically designed for freelancers, such as time tracking, project management, and self-assessment tax return filing.

QuickFile focuses on core accounting functionalities – but does also offer additional features like automated bank feeds and additional file storage for a small extra fee if you were looking to enhance your experience.

What support does QuickFile offer?

While there is no phone support available, QuickFile has a very active online community forum, and promises to answer most questions posted there within a few hours. You can also email their support team directly, but you’re likely to get a quicker response by posting a question in the forum.

Why is QuickFile free?

QuickFile is only free for accounts of a certain size. This is slightly technical, but you’re limited to 1,000 ledger entries (this includes all invoices, purchases and bank transactions). Once you go over this limit, you pay a set fee of £45+VAT per year (approximately £54 in total at current rates).  Moreover, this fee grants you access to some advanced features, such as enhanced bulk invoice entry and VAT bridging tools.

The free version is also supported by ads.

This pricing structure makes it perfect for startups – who can upgrade as their business grows – and means that you can easily try QuickFile for free to see if it’s the right fit for your business.

3. FreeAgent

FreeAgent’s cash flow dashboard

What is FreeAgent?

Set up in 2007, FreeAgent is now used by over 90,000 small businesses across the UK, who use it to keep track of their finances, expenses, invoices, estimates, and more. It boasts some great advanced features, like automatically generated VAT returns, corporation tax forecasts, and self-assessment tools that automatically fill in up to 90% of the self employment tax return form.

It has also won awards (it was named the Small Business Accounting Software of the Year at the 2018 Accounting Excellence Awards, for example), and has an average rating of 4.7 out of 5 (from nearly 1,000 reviews) on Trustpilot.

What can FreeAgent do?

FreeAgent’s huge range of features includes:

• Tools to create and send professional estimates and invoices
• Time tracking tools so you can easily create smart timesheets
• Powerful HMRC integration that makes doing your tax return a doddle
• Automatic creation of VAT returns
• Corporation tax forecasting
• A dashboard that lets you easily monitor your cash flow
• Automatic importation of bank transactions
• A projects view that clearly shows the income, time, and expenses associated with each project, and whether it’s making a profit or loss
• A fully featured mobile app that allows you to snap receipts, create invoices, track time, manage payments, and see your accounts on the go

What support does FreeAgent offer?

FreeAgent offers excellent customer service, with help available from UK-based support accountants via phone and email during business hours (9am-5pm Monday to Friday). The website also has lots of resources that explain things like expenses, invoices, and VAT filing.

Why is FreeAgent free?

FreeAgent is only free for RBS/Natwest business banking customers.

For everyone else, the standard pricing is as follows:

• Sole trader – £19+VAT per month – includes self-assessment filing tool
• Partnership/LLP – £24+VAT per month – includes profit share calculation tool
• Limited company – £29+VAT per month – includes self-assessment filing, dividend vouchers, and corporation tax forecasting tools

All plans have a 30-day free trial.

If you are an RBS/Natwest business banking customer, then you can get FreeAgent for free. However, remember that you are giving up something valuable in exchange – your financial data. Quite what your bank intends to do with this is not yet clear, but make sure you consider how this might affect you before signing up, and discuss this decision with your accountant if you have one.

This is one big prerequisite that the other software such as Zoho Books, Wave Accounting and GnuCash for example do not have – instead, anyone can sign up for their software instantly without any similar barriers to entry.

4. Wave Accounting

Wave’s accounting features including dashboard and invoices

What is Wave Accounting?

Founded in 2010 in Toronto, Canada, Wave Accounting is powerful, free, cloud-based accounting software that has a great UI and a slick marine design scheme. It makes its money by selling payroll and payments services (alongside display ads), which means its free accounting software is pretty much unlimited in terms of account size etc. All this means Wave Accounting is beloved by US startups, but its US/Canada focus means it’s not an ideal fit for UK small businesses – and some may find it a non-starter for this reason.

What can Wave Accounting do?

Wave Accounting has a great range of features which include:

• Tools to create and send professional invoices, even on the go
• Unlimited income and expense tracking
• Keep digital copies of your receipts via an iPhone/Android mobile app
• Create and export a range of accounting reports
• Multi-currency support with automatic exchange rate calculations
• A smart dashboard that organises income, expenses, payments, and invoices
• As well as receipt snapping and invoice creation, the mobile app allows you to easily keep track of your accounts on the move

Wave Accounting is cloud-based and operates online, requiring an internet connection for access. It offers the convenience of accessing your accounting data from anywhere, but it relies on an internet connection to function, whereas GnuCash is a desktop-based accounting software that needs to be installed on a computer and can then work offline.

What support does Wave Accounting offer?

Wave offers expert help via its community forum, and you can also ask for technical support via a help function built into the platform. There is no phone support available, however.

Why is Wave Accounting free?

As mentioned above, Wave Accounting makes its money by displaying ads, and most importantly, by selling payments and payroll services. These services are targeted at US/Canadian customers, with the payroll service being exclusive to those customers. This focus means that, for UK small businesses, Wave Accounting has some significant deficiencies.

Most notably, Wave Accounting does not support the new Making Tax Digital (MTD) protocol for VAT, and so it will be of only limited use to businesses that need to register for VAT and file VAT tax returns digitally. Unlike some of the other providers discussed here, it also does not support the automatic importation of bank transactions via open banking, making keeping track of your financial activity a more time-consuming process.

5. GnuCash

GnuCash’s accounts dashboard

What is GnuCash?

GnuCash began life in 2001, and is a desktop open-source accounting software. If you’re confused by any of that; desktop means you need to actually download and install it, while open-source means that anyone can download and edit the actual code that makes up the program, in order to add extra functionality and fix errors.

This means it’s completely free forever, but it won’t win any awards for its UI, and it’s not particularly tailored to the needs of small businesses (there’s no open banking integration or mobile app, for example). There’s also a bit of a learning curve, and doing your accounts is a more manual and fiddly process than with some of the other software discussed in this piece.

VT Cashbook, with its simplified interface and streamlined features, is specifically designed for small businesses, self-employed individuals, and startups who are looking for an easy-to-use accounting solution without the need for the more advanced functionalities GnuCash offers.

What can GnuCash do?

GnuCash offers a basic range of accounting features. This includes:

• A checkbook-style interface that allows you to record transactions via double entry accounting
• Support for recurring transactions
• Generated reports that show balance sheets, profit and loss etc.
• Customer and vendor tracking tools
• Multiple currency support
• Compatible with QIF files used by some other accounting software

What support does GnuCash offer?

GnuCash supports its users through its forums (called Mailing Lists), and an extensive manual and FAQ. There’s also a part of the GnuCash wiki called Using GnuCash, which gives solutions to common issues encountered by real-world GnuCash users. This probably goes without saying, but there’s no phone or email support for GnuCash.

Why is GnuCash free?

Essentially, GnuCash is made on an entirely voluntary basis, so no one who makes it gets paid at all. The product is then provided free of charge to anyone who wants to use it, and keeps being updated by a dedicated army of volunteer developers. In other words, GnuCash is free because it’s not trying to make money at all – it just wants to help people who can’t afford professional accounting software. If you want to help them out, then you can donate via the GnuCash website, or even volunteer to test new updates.

6. VT Cashbook

VT Cashbook’s accounts dashboard

What is VT Cashbook?

VT Cashbook was released in 2019, but it’s from a company with a strong track record in accounting software. VT Software was founded in 1997, and its professional products (VT Accounts and VT Transaction+) are beloved by accountants, especially small firms that work with small businesses. Cashbook is the starter product – straightforward, easy-to-use desktop accounting software that’s perfect for anyone looking for a simple way to keep track of their accounts.

What can VT Cashbook do?

VT Cashbook offers the following:

• Fast data entry with autocomplete
• Keep track of multiple bank/cash accounts
• Bank reconciliations (check your accounts against your bank statements)
• Produce VAT returns (with paid upgrade)
• Easily correct mistakes
• Produce profit and loss accounts, balance sheets, and ledger reports

What support does VT Cashbook offer?

VT Software doesn’t offer any dedicated support for its free Cashbook program, with the only assistance given is a user guide, available on its website. For the Transaction+ and Accounts programs, support is available by both phone and email, with the requirement that the user is either a current subscriber or purchased the software in the last 12 months.

This may not be a huge problem for most business owners however as VT Cashbook was designed with user experience in mind. GnuCash for example has a comprehensive interface that may have a steeper learning curve for users who are not familiar with accounting principles. It offers a more technical interface with a focus on customization and advanced functionality. VT Cashbook, on the other hand, provides a simpler and more user-friendly interface, making it easier for individuals with limited accounting knowledge to navigate and use the software.

Why is VT Cashbook free?

As with some of the other software on this list, VT Cashbook is free software with basic functionality that is designed to encourage business owners to upgrade to a more advanced paid version.

In this case, VT Software offers two paid options.

The cheaper option is VT Transaction+, which costs £75+VAT a year for a single user. This allows users to create and file Making Tax Digital VAT returns, as well as maintain customer and supplier ledgers.

The full VT Accounts suite costs £150+VAT per year, and allows users to easily create professional reports for their companies, as well as quickly calculate corporation tax. It also works as a Microsoft Excel plugin, making it attractive for any Excel users that don’t want to learn the nuances of a new program.

All VT products come with a 60-day free trial.

Best accounting software with a free trial

While completely free-for-life software can seem appealing, their heavy functional limitations mean they ultimately won’t be a good long-term solution for your business.

All free accounting software comes with caveats and drawbacks, which is why it might be worth the extra few pounds to find the perfect accounting software for your firm.

That’s why as well as free software, we’ll also be looking at paid accounting systems (the best self-employed accounting software as well) and the top contenders in both categories, so you can be certain about which you want to download.

Here are three of the most popular paid accountancy software programs on the market:

• QuickBooks
• FreshBooks
• Sage

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	BEST VALUE
Plan Self Employed	Plan Simple Start	Plan Essentials	Plan Plus	Plan Advanced
Cost £10 per month (excl. VAT) 90% off for 6 months	Cost £14 per month (excl. VAT) 90% off for 6 months	Cost £28 per month (excl. VAT) 90% off for 6 months	Cost £38 per month (excl. VAT) 90% off for 6 months	Cost £90 per month (excl. VAT) 90% off for 6 months

At the time of writing, QuickBooks is offering these plans for 90% off for 6 months. All plans have a 60-day free trial, so you can try it for yourself with no obligation.

Take a look at our full QuickBooks review to find out more about it.

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50% OFF DEAL
Plan Lite	Plan Plus	Plan Premium
Cost £15 per month 50% off for 3 months	Cost £25 per month 50% off for 3 months	Cost £35 per month 50% off for 3 months

The Plus plan costs £25+VAT per month and offers all the features discussed above, plus automated recurring invoices, scheduled late fees, automated late payment reminders, and the ability to create client retainers.

There’s also a handy feature called ‘Proposals’, which helps creative professionals to produce company documents that explain their services or clearly explain their creative plans and associated fees.

This plan is limited to 50 billable clients, but FreshBooks makes clear that this limit applies to active and archived clients, and that old clients can be deleted to make space. You will also still see the info for deleted clients, and deleted clients can be undeleted later.

If you have more than 50 clients, then you’ll need the Premium plan. This costs £35+VAT per month, and supports up to 500 billable clients.

If you have more than 500 billable clients, then you’ll need to contact FreshBooks directly for a custom solution, with a personal account manager and customised training.

On both the plans discussed in detail above, extra users can be added for £7+VAT per person per month, while advanced payments (so you can process cards in person or over the phone) can be added for £15+VAT per month.

At the time of writing, FreshBooks is offering 50% off these plans for the first three months, and all plans have a 30-day free trial so you can try FreshBooks for yourself.

Check out our full review of FreshBooks’ costs.

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Plan Accounting Start	Plan Accounting Standard	Plan Accounting Plus
Cost £14 per month (plus VAT)	Cost £28 per month (plus VAT)	Cost £36 per month (plus VAT)

Sage is also offering 3 months free on all its Business Cloud Accounting packages, as well as a 30-day free trial so you can see if it’s right for your business.

You can check out our full Sage Business review to find out more about it.

How does accounting software work?

Accounting software is user-friendly, as most offer intuitive interfaces that are easy to navigate, which makes it accessible to beginners or more experienced users alike.

It simplifies financial tasks, improves reporting accuracy, facilitates integration with other systems, and enables businesses to efficiently manage their finances so they can make better-informed decisions.

Many software providers offer customer support and training resources to assist users in getting the most out of their accounting software.

You can also rest assured that while managing all these large financial processes, accounting software also offers features like user access controls, data encryption, and regular backups to safeguard sensitive financial data.

What types of businesses should use free accounting software?

Accounting software is suitable for a wide range of businesses, regardless of their size or industry – for example, businesses involved in retail, e-commerce, professional services, consulting, hospitality, construction, and many other sectors. It can definitely be utilised by small startups, freelancers, sole proprietors and mid-sized companies as well as larger enterprises.

The software’s features are flexible, allowing it to adapt to various business models and structures. It can handle different types of transactions, such as sales, purchases, expenses, payroll, and inventory management.

Accounting software provides benefits to businesses with different levels of financial expertise. The software’s easy and customisable features make it accessible to users with varying levels of accounting knowledge and can be tailored to meet the specific needs of many different industries.

Buying guide: How to choose the right free accounting software

Here are some key things you should consider when comparing providers:

• Check with your accountant (if you have one): If you do already work with an accountant, then it may be useful to get their input on what software is likely to work best for your business, and which works best with their systems.
• Choose your compromise: Every piece of free accounting software discussed in this article has benefits and drawbacks. To work out which one is right for you, you need to decide which of the bad points you can live with. Do you want a basic solution that has no usage limits? A slick cloud-based service that you’ll have to pay for once your business reaches a certain size? Regardless of which you choose, chances are you will have to compromise on something – there’s a reason this software is free, after all.
• Take them for a spin: With free accounting software, you can simply sign up/download, put your data in, and see how each feels. Many of the top paid accounting software providers also offer free trials, so you can see exactly what the extra outlay will give you in return.

For a more comprehensive overview of the different paid accounting packages available, check out our page on the best accounting software for small UK businesses.

What should I look for in a free accounting software?

When seeking free accounting software, consider these vital features:

• Bookkeeping: Look for software that simplifies recording financial transactions, managing invoices, and categorising expenses. It should offer an intuitive interface for easy navigation through accounts.
• Accounts payable: the software should streamline tracking and managing outgoing payments, ensuring timely vendor payments and accurate cash flow management.
• Accounts receivable: seek tools that facilitate creating and tracking invoices, sending reminders for overdue payments, and managing incoming cash flow efficiently.
• Financial reporting: opt for software that generates clear and comprehensive reports, enabling you to understand your business’s financial health at a glance.
• More advanced features: while free software has limitations, functionalities like budgeting tools, inventory management, or project tracking might prove very beneficial as your business grows. Be aware that you’ll likely need to pay for accounting software in order to get features like these.
• Integrations: ensure compatibility with other essential tools your business relies on, such as CRM systems, payment gateways, or ecommerce platforms.
• Mobile capability: accessing and managing financial data on the go can be crucial. Look for software that comes with a mobile app or responsive mobile site for convenient access.
• Help and support: check for available resources like tutorials, FAQs, and responsive customer support to assist you in case of queries or issues.

How we test accounting software for UK small businesses

At Startups, it's important to us that the product recommendations we make to small UK businesses are useful, accurate, and based on thorough product testing.

We tested ten market-leading accounting software platforms across four main categories of investigation and 24 subcategories – all in all, we covered 111 areas of investigation. Next, we gave a ‘relevance weighting' to the final product category scores - this ensures the products' final ratings perfectly reflect the specific needs and requirements of Startups readers.

Our main testing categories for accounting software are:

Help and Support: Help and support refer to the assistance and resources available to users when they encounter issues or need guidance while using the accounting software.

Pricing: Pricing refers to the cost associated with using the accounting software. It includes factors such as licensing fees and subscription plans.

Main functions: This represents the key areas of accounting that the software focuses on. This includes functionalities such as financial statement preparation, income and expense tracking, and managing vendor and customer accounts.

Software Functionality: Refers to the software capabilities such as integrations, mobile capability, and confirming any additional features outside of accounting.

The Startups product testing process

Final thoughts

As we edge closer to the tax year flip in April 2024, setting up accounting software, or upgrading or changing your current software, might just be the smartest move you make. These decisions can help shape the coming year’s financial success, so think of this transition as your opportunity to embark on a more efficient, accurate, and ultimately more successful financial future.

Free accounting software is hugely attractive to UK small businesses, especially those that are just starting out.

But you don’t want your small business to stay small forever.

As this piece has explained, all free accounting software comes with compromises. If you can afford it, finding a paid solution that will grow with your business like QuickBooks or FreshBooks could make this whole process much easier.

All the options discussed on this page are either free or offer a 30-day free trial, so be sure to make use of these options. It’s only by actually using the software that you’ll be able to work out which is right for you, which compromises are tolerable, and which extra features are really worth paying for.