Which Package Best Suits You for ‘Making Tax Digital’ ?
Making Tax Digital
We get the point, the whole system needed to be dragged into the 21st century. After all the HMRC have historically run an antiquated process. Determining tax by asking businesses to declare how much they’ve invoiced.
However integrating an electronic accounts package into your day-to-day working obviously leads to questions such as…
Which package do we choose ?
What is compatible ?
Which one works best for our needs ?
On a daily basis, we access many different accounts packages whilst we manage and administer our client’s credit control functions. As a result, we’re well placed to pass on our independent opinion about which accounts systems work best and why.
There are many different accounting packages in the marketplace such as Harvest, Kashflow, Wave etc. Some new, some old, all are unique and all fulfil a purpose. However for the sake of ease, let’s concentrate of the big three providers, these being:
Sage is generally considered to be the originator and has a well-established name within the accounting industry but this may well prove to be its downfall. Although Sage are working constantly to improve its ‘user friendliness’ and are launching various different models to stay ‘in vogue’, in our opinion Sage is only great if you have a good grasp of accounts from the outset. For businesses with less accountancy knowledge then Sage may not be the best introduction to accounting software.
Quickbooks has also been around for a while. They were pioneers in the low cost, static, computer based package but in turn were a little slow in developing the on-line element of their software. They are more than making up for this now and their advertising presence has increased dramatically during the last few years. However in our opinion, although Quickbooks are nearly there with the customer ‘interface experience’, there still remains further work to be done on usability and business ‘add-ons’.
In our view Xero is the best starter package for a business looking to gain control of both its accounts and its credit control function. Whereas we think Sage suits accountancy people with a grasp of business, we think the opposite of Xero. We believe it helps business people in gaining a more simple understanding of their accounts. Because of this, the simple functionality and the suite of optional business ‘add-ons’ we think Xero suits the ‘masses’ more.
Furthermore Gavin McBride Director of Smith McBride Chartered Accountants and Tax Consultants shares our view:
“As a practice we have had experience with most if not all of the bookkeeping software on the market. Xero is our preferred choice for our clients to use. The main reason being that they find it easy and logical to use. Xero can really help a business owner to run a much more efficient business and keep track of who owes them money! It can also help them to keep a handle on how much money they are or are not make day to day”.
When making your choice here are things to consider
In our opinion, a good accounts package should include a minimum of 3 key elements:
1. Have the functionality to raise invoices on a daily basis, to either one individual client or a number of clients in a run. With the ability to then be able to email both the original invoices and provide copies at any given time. This allows the essential process of billing to occur without delay.
2. Allow you to create a statement of account for an individual client, with no barriers as to dates, values or numbers of transactions. This gives you the ability to remind customers of their complete balance and so encourage ledger clearance.
3. Have the ability to raise management information reports, to highlight what monies are owed to you and by whom. This can create a process for the pursuit and recovery of your outstanding monies. This provides you the ability to manage your aged debt and your cash flow.
Successful cash flow and credit control is all about getting the basics right and this without doubt very much includes choosing the right accounting systems and credit management partners to work alongside your business.
The more aspects of your systems you get right at the start, the lesser the problems created down the line.
Over 20 years of trading, training and guidance has taught us here at Corp & Comm that…
‘an ounce of prevention is worth a pound of any cure’.