Online accounting software for (very) small business!

[simonukbf38468]

I'm operating as a sole trader. I have a Starling business account and currently have a trial of their Business Toolkit but I'm not sure if that's enough? Will this suffice for very simple accounting needs?

It's only a hobby business and the accounting will be simple enough but don't really want to start spending £10 a month on Xero or £20+ a month on FreeAgent if I don't need to (even though I've used and like both of those products for other, bigger businesses).

 

[neilsolaris]

Can you just use a spreadsheet? That's what I do for my self-employed business.

 

[DWS]

Try VT cash book it’s free

 

[UK Contractor Accountant]

VT CB is not online

Look up Quickfile

https://www.quickfile.co.uk

 

[Spur Support Services]

Pandle has a free version, but you have to pay for the version with the bank feeds and document import.

However, it is worth considering why you don't feel that the £12 per month for Xero is a necessary cost of running a business, in the same way that you may start with the free version of tools like Calendly and Canva but then upgrade to Pro when you realise just how much time and stress they save.

Spreadsheets may seem like a cost saving, but in truth are time intensive. Time that from my perspective is better spent with the family surfing in North Devon.

Spreadsheets will be also be less relevant as HMRC introduces MTD from April 2023

Don't discount the Starling toolkit. I'm not familiar with it, but Tide, Starling's rival, has accounting functionality and the ability for accountants to be given read only access. I wouldn't be surprised if Starling had developed a similar solution.

I think the big question is sales and transaction volume. The higher the volume, the greater the benefit of using Xero, irrespective of whether you personally consider your business a hobby.

 

[neilsolaris]

Sorry to butt in, but I was curious to know why spreadsheets are (always) more time intensive. I do the bookkeeping for an orchestra, and for that I use Quickbooks (that was not my choice, it's what was being used when I took over). For this kind of company, I would definitely favour an accounting programme. Having said that, data entry can be much slower than a spreadsheet, being the online version, and there is less scope to copy and paste like with a spreadsheet.

For my sole trader business (self-employed musician) I use a spreadsheet, and data entry is extremely quick. I've written VBA code for creating new customer worksheets, as well as VBA code for tax calculation. It automatically creates an income statement for me, and I feel the spreadsheet is perfect for my purposes.

 

[Scalloway]

I came into small business accounting when I became treasurer of a local licensed club. Thenadays PCs were a novelty and cheap accounting systems for them were non-existent. I was forced to create spreadsheets to deal with bookkeeping (using Supercalc if any geeks are interested). Over the years I created a multipage spreadsheet system which I used for a variety of small businesses.

However over the years I realised that the ease of altering a spreadsheet to meet a specific need meant it was just as easy to alter it so that a vital part was removed and it ceased to work.

Another problem with spreadsheets is they are only as good as the person creating them. If you understand basic bookkeeping you can create something that works but you can just as easily end up with something disjointed that makes no sense to anybody else looking at it.

Using dedicated software reduces the margin of error. I now use VT Cashbook when I set up the books for any small organisation that needs it.

 

[neilsolaris]

I know what you mean, regarding spreadsheets only being as good as the person using them. I help some friends/colleagues with their bookkeeping and tax returns, and some of their spreadsheets are a mess!

For my sole trade business though, I do feel that my spreadsheet does the job perfectly. But I agree with all your points.

 

[Argentum Tax]

Another problem with spreadsheets is they are only as good as the person creating them. If you understand basic bookkeeping you can create something that works but you can just as easily end up with something disjointed that makes no sense to anybody else looking at it.

I agree totally Scalloway. I have seen some horrendous spreadsheets where the creator/owner thinks they are the ultimate in bookkeeping records. It is disheartening to tell a client the spreadsheet is nowhere near as good or as accurate as he/she thinks. There is no real substitute for proper bookkeeping software.

 

[WaveJumper]

Do you have an accountant?

 

[simonukbf38468]

No. I don't see any need for one with such low turnover. It's very much a hobby business.

 

[WaveJumper]

The reason I asked was if you had said yes I would have advised go check what they recommend for their clients (and you generally get a better rate on the software) I agree with others here, yes spread sheets are fine and I run some of the most complex keeping track of financials within another area but using Xero for accounting purposes for me save lots of valuable time.

Go with what your happy using, if you are only talking about a very small income on the side as you say the cost may outweigh the end result, but I would also advice have one eye on the future as this grows and never underestimate how having a good relationship with a local accountant can save you a lot of heartache and money going forward

 

[MyAccountantOnline]

I'm operating as a sole trader. I have a Starling business account and currently have a trial of their Business Toolkit but I'm not sure if that's enough? Will this suffice for very simple accounting needs?

It's only a hobby business and the accounting will be simple enough but don't really want to start spending £10 a month on Xero or £20+ a month on FreeAgent if I don't need to (even though I've used and like both of those products for other, bigger businesses).

What sort of business are you running and do you need anything specific from your software - for example do you need to invoice customers/clients, do you use PayPal, are you likely to become VAT registered etc.? Also roughly how many transactions (payments and receipts) do you have going in and out of the business each month?

 

[DontAsk]

Starling's rival, has accounting functionality and the ability for accountants to be given read only access.

What use is that at year end? Accountant needs to be able to make various entries.