22 Feb 2023

The Top 5 Accountancy Apps for SMEs

My colleague Clare Bowen recently wrote about the changes HMRC has initiated in the journey towards Making Tax Digital (MTD) in the UK. The delay of an additional two years – until at least April 2026 – will have come as a relief for many who were facing a rush to digitise their taxes. On the one hand, software providers will be frustrated that their investments in new apps and suitable solutions for MTD will now seem rushed, but the extra time is no bad thing; they will now have time to iron out issues and make improvements to their platforms, rather than rushing their release.

On the other hand, the delay shouldn’t mean that businesses should continue to hold off on switching. Because, even though MTD will cause the greatest upheaval for the likes of small business owners, sole traders and landlords in terms of their business processes, they stand to gain the most from the changes – Clare also outlined many of the reasons why.

And there really is no reason not to digitise your accounts, especially with the emergence of a number of apps that can support your business needs, particularly in niche sectors or for very specific types of organisations.

Some of the best we’ve seen so far, and are recommending to our clients, are below. All of these apps are linked in with our preferred accounting software Xero which enables clients to manage their financials on the go, connecting their bank as well as getting insightful reports. Xero has opened its software to over 1200 other apps and developers which means there is something for everyone to enhance their workflows including expenses apps, CRM, project management tools and stock management. Bespoke integrations can also be created where an ‘off the shelf’ app doesn’t work for a client.

Dext Prepare
This is one of a number of apps that remove manual data entry – an essential time-saver for the likes of sole traders. Users can simply snap a picture of an invoice or receipt and Dext will pick out the information and feed it into an accountancy software, such as Xero. When published it will also store an attachment of the image in the software for easy reference. There are other ways to send information to Dext including direct email and the system will automatically pull invoices from companies such as Amazon. Dext uses AI to learn from previous postings and supplier rules can be set up for ease of posting.

‘The property finance platform for UK landlords’ – a brilliant app made by landlords, for landlords, which allows you to register multiple rental properties – whether solely or jointly owned – and link your bank to track income and expenditure across different tenants. From there it shows accounts in real-time across multiple properties and provides useful insights into investments such as profit and loss statements, LTV ratios, rental yields and occupancy rates. It matches incoming and outgoing payments, for ease of bookkeeping, and updates your tax statement, so there are no nasty tax surprises. It also has user friendly features like linking with Google Street View and Right Move valuations, so you can see how your properties compare to others on the rental market.

Dext Commerce
‘Simplified sales accounting’ – as the name suggests, this is a one for e-commerce businesses. It collates data from multiple sales channels/payment platforms – like Amazon, eBay, Shopify, Etsy, Stripe, PayPal etc – itemising your transactions so you can see where you’re making sales and making hassle free MTD-compliant postings to other accounting software. If you’re someone who's selling 10,000 items on eBay each month, it gives you easy reconciliation of money received, and you can see data on expenses, refunds and reimbursements in a clear layout that’s easy to interpret.

Forecasting of cash flow is incredibly important in the current financial climate and Float is a great tool that is easy to use. It allows you to add in scenarios, such as bringing on an extra employee, and forecast how much extra revenue they'd bring versus their cost. It can forecast up to three years and links to accounting software platforms to enable real-time insights and visibility over incoming payments and expected expenditure.

‘The tool to get your financial documents approved on time’ – this app works alongside digital accountancy platforms to remove paper and email approvals, and keep track of spending. Users can automate their approval workflow, set up approvers for different areas of the business, and introduce multi-layered approvals, all while safeguarding sensitive data. The platform gives complete control and flexibility to each business’ needs, even offering an invoice-to-PO matching facility, including upload of proof of delivery documents.

For the businesses that are coming late to the digital party – invariably those who have been too busy to think about it, which is great for them because it means their business is running well – they may well be scared about what the changes mean for them. It can become very daunting and there’s a temptation to bury your head in the sand. But it's not as hard as it looks. Talk to your accountant as soon as possible, because they will be able to expertly guide you, and give you confidence. And once the changes are made, life will be a lot easier.

If you or your business plan needs support in implementing one of these apps then get in touch with our Digital Solutions team today who will be more than happy to help, alternatively you can view and download our guide to The top 5 Accountancy Apps for SMEs.

Cara Mastrodomenico