TABLE OF CONTENTS
- The Best Overall Accounting Software for Small Businesses
- Free Accounting Software: What You Might Be Missing
- Which Accounting Software Is Right for You?
If you run a business, you’re going to need accounting software to help manage your finances. Many small companies have relatively simple needs and may be able to rely on free accounting software that’s available online.
Using accounting software can save you time, help you keep an eye on expenses and cash flow and streamline your tax-filing preparation.
While you’ll likely need an accountant to make sure your business is following legal and accepted accounting practices, the software can handle much of the day-to-day tasks as well as generate crucial accounting reports, saving you time and money.
The Best Overall Accounting Software for Small Businesses
You know that “free” often doesn’t really mean free. There’s a big difference between a 30-day free trial or a try-it-before-you-buy-it and free. While the software we’re listing does include versions or add-on modules you can purchase, each software developer offers a free, basic version.
Whether targeted for the self-employed or small companies, here the 9 best free accounting software programs, be they online, offline or in the cloud:
If you are looking for basic accounting software that can manage your accounts and money for free, consider Wave.
This application lets you connect any number of credit cards and bank accounts to the program. It also allows you to track income and expenses. Receipts and invoices can be scanned into the system and matched up with accounts.
You’ll pay an additional fee if you want to invoice customers and collect payments online. Automated Clearing House (ACH) payments will cost you 1% of the invoice. Credit cards will cost 2.9% and a 30-cent charge for each transaction in addition to whatever you have to pay your credit card provider. Payroll functions are also an add-on with fees ranging from $20-$35 per month and $4 per employee or contractor charge.
The free version of CloudBooks lets you add an unlimited number of staff users for a single account. It is a cloud-based program that provides Secure Sockets Layer (SSL) encryption and secure data storage in the cloud. You can create projects, invoices and estimates. It comes with integrated time tracking and expenses tracking.
The free version doesn’t allow you to add your branding or provide telephone or chat support for questions. It only allows you to create 5 invoices a month and doesn’t let you handle invoice payments electronically through the software. These options are available for $10 to $20 a month depending on which paid version you select.
ZipBooks will let you manage an unlimited number of vendors, send any number of invoices and accept digital payments from PayPal or Square. You also can connect to one bank account.
The free version includes a basic chart of accounts, general ledger, balance sheets and income statements. Paid versions, ranging from $15 to $35 a month, include features such as recurring automated invoices with auto-bill, payment reminders, invoice line items, smart tagging, document sharing, time tracking and reconciliation. You also can integrate payroll with an add-on option from a third-party provider starting at $39 a month and $6 per person.
If you prefer to keep your books on your computer and not in the cloud, you may want to consider GnuCash, which provides free software for personal and small-business accounting. You can use it to track your accounts, income, expenses and investments.
GnuCash allows you to enter split transactions, reconcile accounts and schedule recurring invoices and transactions. The small business accounting version allows you to manage customer and vendors, jobs, invoices, bill payment, billing terms and helps prepare your books for tax time. It also offers basic receivables and payable accounts to manage payroll for employees.
GnuCash is part of the GNU project, a free software, mass-collaboration effort. It can run on GNU/Linux, BSD, Solaris, Mac OS X and Microsoft Windows as open-source software.
SlickPie bills itself as a simple expense-management software program for small businesses. It features online invoicing and billing, automated data entry, live feeds from bank accounts and financial reporting.
The free version of SlickPie will accommodate 10 companies and handle PayPal, Stripe, and credit-card processing with no additional fees beyond what payment processors charge. You can send online invoices, track expenses, manage bills and set up recurring invoices. You also can perform basic accounting functions, including reconciliation and reporting.
The Pro version, which costs $39.95 a month, expands your capacity to 50 companies and includes phone and email support
The simplistic look of the website makes it clear: VT Cash Books is no-frills accounting software that’s easy to use. Free and from the U.K., VT Cash Books features fast data entry with auto-complete functions, supports multiple bank and cash accounts, handles bank reconciliation and generate profit-and-loss statements, balance sheets and ledger reports.
It can also handle value-added tax (VAT) returns. The free desktop software installs with another program, VT Transactions+, which provides added functionality for small business. VT Transactions+ comes with a free 60-day trial but requires you to purchase a passkey to continue using it after that period.
This is free online software that offers most of the routine accounting tasks you need. You can sync accounts, track expenses, generate invoices, and set up recurring bills. Akaunting allows you to manage both customers and vendors. Similar to GnuCash, it’s open-source software.
Akaunting will accept online payments with no fees in addition to your third-party payment provider.
QuickFile is cloud-based accounting software that’s designed for those without accounting backgrounds. An easy-to-use online interface supports automatic invoicing, receipt management, banking automation, estimates and quotes and basic financial reporting. It also has a fully branded client area built in the program.
The company has different free tiers for businesses based on the average number of ledger entries: 200, 201-500 or 501-1000. If you exceed 1,000 transactions yearly, you will move into a paid tier that works out to about $58 a year and will prepare your VAT statements for filing.
TurboCash is another open-source software application. It benefits from a team of online developers and an active user community that can help answer questions. The desktop version handles your general ledger, cash book, stock, creditors, debtors and invoices.
Similar to other free accounting programs, it does double-entry batches to make sure your books are balanced and provides generally accepted accounting principles (GAAP) reports.
As your business expands, you may need to upgrade to the paid versions which have more advanced features, including budgeting, payroll and additional analytics. The paid version operates in the cloud.
Free Accounting Software: What You Might Be Missing
Free is good, but only if it gets the job done the way you need it. If you want state-of-the-art accounting software, you’re going to have to spend some money. Here are some of the functions that free accounting software typically doesn’t include.
Payroll and Tax Capabilities
Most free programs won’t meet your payroll or tax reporting needs. If they do, there will be an upcharge or monthly fee to do so. Depending on the software, the additional charges may add up to more than some paid services.
If you need more than the basic entry-level reports that free accounting software provides, you may want to explore paid versions that offer more sophisticated reporting options.
You may get estimating options in free software, but you won’t find financial forecasting. Running your business efficiently means looking ahead and forecasting your cash flow and performance.
Inventory and Invoicing
Few free accounting software offerings will track inventory or orders. Depending on your business, these may be must-have features. Also note most free accounting software will limit the number of users, customers, or invoices you can generate. Some programs also may charge additional fees for sending invoices online and collecting payments online.
Which Accounting Software Is Right for You?
If you’re unsure whether you should use free accounting software or opt for a paid version, you may want to compare options. Conduct some free trials. Each of these 6 companies offers free trials for a minimum of 14 days:
Popular Paid Accounting Software
- QuickBooks starts at $20 a month
- FreshBooks starts at $15 a month
- Sage starts at $25 a month
- Zoho Books starts at $9 a month
- Kashoo starts at $19.95 a month
- Xero starts at $9 a month
Check carefully: Most have higher-level options with added features (at higher prices) and add-ons that may be necessary for your business.
Which accounting software you choose will be the one that works best for you. Make sure to make a list of the features you need — and don’t settle for software that doesn’t meet those needs.