As a business owner it can be easy to get lost in spreadsheets, invoices and receipts. It can also be very time consuming. In this blog, we’ve listed some of the benefits of using accounting software.
Before we move on to the benefits of using accounting software, let’s explain one of the biggest reasons you should move your business accounts on to accounting software.
Making Tax Digital (MTD) will mean that somewhere in the near future, we’ll all have to be using some form of accounting software. Making Tax Digital (MTD) is HMRC’s plan to digitise the tax system. This will mean that as a business owner you will need accounting software to submit your business accounts/tax return.
So, with that in mind, here are some of the benefits of using accounting software.
One of the biggest benefits of using accounting software is that you can invite your accountant to be a user. This means that your accountant can have access to your business accounts. This is a real benefit when you need help with your accounts and to grow or strategise your business.
You can ask your accountant to do a little or as much as you like. They could submit your vat returns for you or just complete a review. You may just need some help with expenses or you could pass over all the bookkeeping. It’s up to you how much you ask your accountant to do but having accounting software gives you that flexibility.
Automating processes in your accounting software can save you valuable time. When it comes to automation you can set up all your products/services and prices. You can compile statements and generate invoices and accurately input income and expenditure. There’s less room for error when the software computes income and expenditure for you. This means you’ve got a clearer picture of how your business is performing.
Accounting software simplifies tax filing
Accounting software keeps your business transactions organised. You (or your accountant) can easily access your books to complete your tax return. Accounting software will also help keep your accounts organised and accurately record your information.
This leaves less room for errors which can cost you when it comes to filing your accounts with HMRC. Missing or incorrect information on your tax return can result in fines, penalties and possible legal issues. Using accounting software like Quickbooks can significantly reduce errors.
Accounting software is efficient
Most accounting software is cloud-based, meaning you can access your accounts anywhere, anytime. You can link your bank accounts allowing the software to pull through all the data about your income and expenditure.
Most accounting software has a ‘recurring invoice’ feature, allowing you to recur invoices weekly or monthly, it’s completely up to you. Many of the features of accounting software can be completely tailored to your business.
Receipt capture is one of the most efficient benefits of using accounting software. It allows you to snap a photo of your receipt on your phone wherever you are. As long as there’s an internet connection you can upload receipts wherever you are.
Building up a financial history on your accounting software can give you the ability to view the history, track progress and plan ahead. Most software can create reports to help you analyse your business, track your finances and set business goals. There are standard reports like profit and loss but you can create custom reports too.
Looking at your financial history can help you plan cash flow. By comparing your business income and expenses from one year to the next, you can project cash flow. Having real-time information about your business finances can help you meet your targets and goals.
These are just a few of the benefits of using accounting software. If you need help making the transition from spreadsheets to accounting software, give us a call today.