All small business owners will understand the necessity for keeping their accounting and bookkeeping up to date, in order to meet those HMRC deadlines and keep on top of their cashflow. You may well find that this is a laborious task, especially if you’re using good old-fashioned pen and paper, or even if you’ve upgraded to a straightforward Excel spreadsheet. However, using cloud-based accounting software like Xero or QuickBooks is much more efficient, will help save you time and makes completing tax returns simpler. To help you choose which software would be the best fit for you and your business, let’s look at what both Xero and QuickBooks have to offer.
Is it approved software by HMRC?
Yes, both QuickBooks and Xero are HMRC-compliant for Making Tax Digital purposes. They both also feature handy guides and support services to make the Making Tax Digital transition easier.
How hard is it to install the software?
Both QuickBooks and Xero are cloud-based software which means you can download them to your laptop, iPad or mobile phone device and use them anywhere. They also both have easy to set up dashboards which can be tailored uniquely to your needs.
Will it integrate with my bank?
Both Xero and QuickBooks have already integrated with Santander, HSBC, Lloyds, Barclays, TSB, American Express and so many more. However, always check with your bank that the software of your choice can be integrated with your accounts first before committing.
Are they easy to use?
Both of these cloud-based accounting software systems provide easy to set up online dashboards where you can monitor your cashflow, invoices and transactions. Xero is simpler and more minimalist in its set-up and display dashboard; it is known for being easier to use.
Do they offer free trials?
Only Xero offers a 30-day free trial which is where QuickBooks loses out; however bear in mind that Xero is slightly more expensive overall, although both offer monthly subscriptions. Remember both packages also include the phone app, which can help to avoid reams of paper receipts and also track your company car’s mileage.
How much do they cost?
Both offer different packages within different price ranges. QuickBooks begins with a Self-Employed Package at £4 per month and goes up to the £16 per month Plus Package, which caps each business at having a maximum of 5 users. Alternatively, Xero begins at £12 per month with the Starter Package and goes up to the Ultimate Package at £49 per month. Xero is more expensive but allows an unlimited number of users to access the account.
What is the difference between QuickBooks and Xero?
It is the integral differences in the invoicing and reporting features which sets these two software packages apart. Firstly, in regard to setting up and sending out invoices, QuickBooks wins hands down. Whilst Xero ensures all payroll, expenses and invoicing are kept all in one section for ease of use, QuickBooks goes one step further and allows you to send professional invoices out efficiently and accurately in minutes.
Should I choose QuickBooks or Xero?
Whilst Xero does include reporting and has many options for customisation, it is QuickBooks which provides the more detailed and accurate reporting, making it easy to keep track of your profit, loss and cashflow insights. Xero’s simplistic design and user-experience is ideal for start-ups, but it is QuickBooks that gets our vote for small businesses. Even though Xero boasts an unlimited number of users, QuickBooks advanced reporting, and efficient management of expenses and bills places it as market leader.
If your business is growing it is inevitable that you will need to make the leap to using cloud-based accounting soon; so, speak to our team at Kench & Co who are happy to help set this up and ensure the transfer is simple, efficient and effective.