The requirements of any accounts system are to keep track of income and expenditure and tell the business owner how his or her business is doing in enough detail to keep HMRC happy.  

In a really simple business structure, a quick look at the bank balance might be enough to get an overview, but it doesn't always tell the true story when things are moving quickly - which is where accounting software comes in.   

However, using a computerised accounting system can be a project in its own right, and getting one set up can be very time consuming. 

Apart from manual systems, including paper books and spreadsheets, there are two basic options, a cloud based system or a system where the software and data reside on your own computer and network.

Prices vary but most cloud systems are paid for monthly. You can find good advice from the Institute of Chartered Accountants, which has published a guide to online accounting packages.

But beware, you might need to keep your own backup of data, preferably in a form other software can understand, and you shouldn't rely on the cloud system to keep your valuable data safe.

The de facto choice of accounting software for small businesses is Sage 50 or, its cut down sister Sage Instant. And Sage have a cloud based version as well, which you pay for on a monthly basis.

However, these systems are not cheap and the learning curve is high so outsourcing is preferred by most people.  

Should you hire an bookkeeper?

Getting the best advice is invaluable and is bound to save you money in the long term. They are a very good source of advice to help you stay on the right side of the tax rules.

What can accounting software help with?

There are a vast range of services and tools available with accounting software, and they vary between individual offerings. The most basic software allows you to record your income and expenditure in a clear manner. More complex offerings allow you to fill out tax forms and file returns, control stock levels, make and send invoices and even carry out payments in a variety of currencies.