Small business accounting apps: The perfect tools to streamline your finances

Managing finances is a vital yet often tedious aspect of running a small business. You’ve got invoices to send, expenses to track, and tax deadlines to meet. Traditional spreadsheets or paper bookkeeping might work at first, but as your business grows, so does the complexity of your financial needs. That’s where small business accounting apps come in. These apps offer powerful, easy-to-use tools that make financial management more efficient, allowing you to focus on growing your business instead of crunching numbers.

Accounting apps are more than just bookkeeping software—they’re designed to streamline everything from invoicing and expense tracking to generating detailed reports and managing tax filings. Whether you’re a solopreneur, a freelancer, or a growing business with employees, there’s an app tailored to your specific needs. Let’s dive into why small businesses need accounting apps, the features to look for, and a roundup of the best options available in 2024.

Why every small business needs an accounting app

Let’s face it—financial management can be overwhelming, especially when you’re wearing multiple hats as a small business owner. If you’re manually tracking expenses or relying on outdated systems, you’re not only wasting valuable time but also increasing the risk of errors. Accounting apps solve these challenges by automating tedious tasks, reducing the likelihood of mistakes, and providing real-time financial insights. Here’s why these apps are a must-have for small businesses:

They save time by automating repetitive tasks like invoicing, data entry, and reconciliation. With everything synced in one place, you can avoid wasting hours sifting through receipts or spreadsheets. These apps help minimize errors. Manual accounting can lead to miscalculations or missing records. With features like automated data imports and categorization, accounting apps ensure accuracy. Tax season becomes less stressful. Many apps come with built-in tax tools, ensuring compliance with regulations and making tax prep much easier. Most importantly, these apps offer detailed financial insights. With real-time data, you can monitor your cash flow, profits, and expenses, allowing you to make informed decisions to grow your business.

What features should you look for in an accounting app?

Not all accounting apps are created equal, and the features you’ll need depend on your business size, industry, and goals. Here are the key features to prioritize when choosing an accounting app:

Ease of use

You don’t have to be an accountant to use these tools. Look for apps with intuitive interfaces that simplify complex financial tasks, even for beginners.

Invoicing capabilities

The ability to create professional-looking invoices is essential. Look for apps that allow you to customize invoices, send reminders for late payments, and track paid and unpaid bills.

Expense tracking

A good app should let you track expenses effortlessly. Features like receipt scanning, expense categorization, and real-time updates can help you stay on top of spending.

Tax compliance

Choose an app that simplifies tax preparation by offering tax reports, automated deductions, and even tax filing features to ensure you’re always compliant with local regulations.

Integration options

Your accounting app should integrate with tools you already use, such as payment processors (e.g., Stripe, PayPal), e-commerce platforms, and project management software.

Scalability

Your accounting needs will grow as your business expands. Choose an app with tiered pricing plans or advanced features that accommodate growth, like payroll or inventory management.

Mobile accessibility

A mobile-friendly app allows you to manage finances on the go, whether you’re traveling, meeting clients, or working remotely.

How to choose the right app for your business

To choose the best accounting app for your needs, start by evaluating your priorities. For freelancers, tools like Bonsai and FreshBooks offer project-specific features and simple invoicing. For businesses managing inventory or handling payroll, apps like Xero or QuickBooks Online are better suited. Budget is another key factor. While Wave is free, other apps offer pricing tiers that grow with your business. Take advantage of free trials to test out the features and functionality of each app. Finally, consider reading user reviews to see how these apps perform in real-world scenarios.

FAQs about small business accounting apps

Do I need an accounting app if my business is new?

Yes, even new businesses benefit from accounting apps by keeping finances organized and preparing for tax season.

Are accounting apps easy to use?

Most apps are designed with user-friendly interfaces, making them accessible even for those with no accounting background.

Do these apps help with taxes?

Yes, many apps offer tax reports, compliance tools, and automated deductions to simplify tax preparation.