Top Easy-to-Use Accounting Software for Small Businesses 2025

The majority of businesses in India are either small or medium-sized. These businesses are driving the economy and GDP, but many of them lack financial oversight and literacy. 15% of errors in the accounting of small businesses are due to the misclassification of expense accounts. This is why there is a growing demand for accounting software for small businesses.

Using the best accounting tools for small businesses not only helps your business grow but also helps maintain good cash flow. Being a small business owner, you must adopt easy to use accounting software to get a clear understanding of your business’s financial health. Discover the top accounting software for businesses in India in 2025.

Why Do Small Businesses Need Accounting Software?

Even if it seems like you are running a small business, you still have so many expenses, invoices, bills, and accounts to handle. As a small business owner, you manage sales, handle inventory and also maintain accounts and bookkeeping.

In India, only 40% of small business owners are financially illiterate, and 81% handle their accounting tasks on their own. This is why small businesses need accounting software to ensure accuracy and compliance without errors. These tools take care of tedious and time-consuming tasks so that you can spend more time on expanding and growing your small business or serving your customers.

An easy-to-use accounting software for small businesses helps in bookkeeping by recording all business transactions like sales, purchases, and expenses. It also frees resources from tracking payments and outstanding dues. Besides all these, it also helps you get a business loan. Here are some of the most compelling benefits of accounting software for small businesses you must know:

1. Time-saving and Efficiency

Typing financial data manually is time-consuming, especially when your business grows and you need to handle more transactions. It also increases the risk of errors and mistakes, which can lead to serious problems for your business.

Top accounting software helps solve this by ensuring accurate accounting automation for small businesses. It automates tasks like recording transactions, sending invoices, tracking payments, and creating reports. This not only saves time but also makes your work efficient.

2. Accuracy and Compliance

Being a small business owner, you will find difficulty in complying with tax rules, accounting standards, and regulations. Top accounting software for business simplifies compliance. These tools ensure that your financial records meet the necessary standards. The top accounting software for businesses checks the numbers for you.

3. Cost-Effective

Hiring an accountant can be expensive, and manual accounting is time-consuming and prone to errors. Accounting software is a cost-effective and efficient solution. It automates tasks, reduces mistakes, and offers real-time financial insights. This affordable tool grows with your business, saving both time and money while ensuring accuracy.

Key Features to Look for in Accounting Software

You must prioritise features of accounting software for small businesses as they decide the accuracy and efficiency of accounting results. Whether it is analysis and report or billing and invoicing, you must emphasise the best features in accounting tools.

These features determine how smoothly your small business runs, complies and maintains cash flow. Whether you have just started a business or are growing rapidly, you must choose a tool with the best features in accounting tools:

1. User-Friendliness

Running a business is already hard enough, and your software shouldn’t make it harder. User-friendly accounting software should have a simple layout and easy navigation. This allows you to find what you need quickly, even if you’re not a finance expert, including those who are not computer or accounting experts.

We suggest options with multi-dimensional reporting features. This helps your team produce reports that align with the objectives and requirements of your business.

2. Invoicing and Billing

Transactions are part of every business’s daily operations, and so are invoicing and billing. Whether you are running a kirana store or an ecommerce business, invoicing and billing are the fundamental features an accounting tool must have. The tool should be able to create, send, and track invoices easily. This helps you get paid faster and avoid missed payments.

3. Expense Tracking and Reports

Expense tracking in accounting tools is vital to determining cash flow and maintaining transparency. It records, categorises, and monitors all business expenditures to ensure financial transparency and control. Best accounting software 2025 must offer clear reports and insights into your expenses, profits, and overall performance. These accounting tool features help you make smart financial decisions.

4. Tax Compliance

Dealing with taxes can be stressful, but it is nonetheless important to ensure you abide by the applicable tax laws. That’s why you need accounting software with tax features like automatic tax calculation, GST/VAT support, and easy tax report generation. It helps you stay compliant with local tax rules.

5. Integration with Other Tools

Your accounting tool should work well with your bank, payment gateways, and even e-commerce platforms. This makes everything, from sales to final payments, more connected and easier to manage.

Popular and Easy-to-Use Accounting Software for Small Businesses

Managing accounts and finances can be complex and time-consuming, especially when you don’t have full knowledge of it. In this situation, it is natural for you to feel underconfident as a business owner. A survey, however, reveals that 64.4% of small business owners use accounting software in India and feel more confident managing their finances digitally.

This is why accounting software is a game-changer that simplifies these tasks with the help of invoicing, expense tracking, tax calculations, and reporting. Here is the overview of some of the best accounting software for small businesses in 2025. These popular accounting tools for small businesses are easy to use and packed with features that suit startups, freelancers, and growing businesses.

1. QuickBooks Online

QuickBooks is a simple accounting software that essentially tracks business income, expenses, and organizes financial information. Its robust features, easy-to-use design, and seamless cloud accessibility make it one of the best accounting tools for small companies. It streamlines all facets of financial administration, from bank reconciliation to invoicing and cost tracking.

Key Features

• Auto tracks business income and expenses 
• Save time with invoicing 
• Invoicing & Payments
• Manage inventory in real-time 
• Expense & Receipt Tracking
• Inventory Management
• Financial Reporting and Payroll Integration

Pros of QuickBooks Online

• It offers all time access to financial information and reports.
• Multi-device access that allows you to access it anytime and from any device.
• Prioritises data security to ensure your data is safe against threats and cyber attacks.
• Helps you be tax-ready with the GST & Tax Compliance 
• Increased accuracy to ensure your decisions are data-driven

Cons of QuickBooks Online

• Advanced features require higher-priced plans
• Higher pricing compared to some local alternatives
• Occasional syncing issues with banks
• Inventory and payroll features are only available in higher-tier plans
• Limited customisation for reports and invoices
• Internet dependency (no offline mode)

2. FreshBooks

FreshBooks is known for its clean interface and is especially great for service-based businesses like consultants, designers, and freelancers. It is perfect for business owners who need simplicity without compromising functionality since it simplifies essential financial activities like time tracking, project-based invoicing, working capital management, and scheduled reminders.

Key Features of FreshBooks

• Time tracking and project management
• Customisable invoicing
• Tax-ready financial reports
• Client and payment tracking
• Cloud-Based Access
• Online Payment Integration
• Multi-Currency & Tax Support

Pros of FreshBooks

• User-friendly interface that makes it easy to use even for non-accountants
• You can seamlessly integrate time tracking and invoicing
• Automated payment reminders and late fees improve cash flow
• Mobile app support for managing finances on the go
• Client portals for easier communication and payments

Cons of FreshBooks

• Limited reporting in the Lite version
• Extra cost for additional user
• Lacks built-in GST compliance tailored to Indian businesses
• Limited payroll integration
• Limited features for product-based businesses with inventory

3. Wave

Wave is one of the best free and easy-to-use accounting tools for small business owners. Without putting necessary services behind paywalls, it provides a fully free range of fundamental capabilities, including accounting, financial reporting, expenditure monitoring, and invoicing. Wave’s user-friendly interface and automated features make it particularly attractive to companies with few resources and straightforward financial requirements.

Key Features of Wave

• Professional invoicing
• Accounting and bookkeeping
• Receipt scanning
• Financial reports (P&L, Balance Sheet, Cash Flow)
• Custom Invoicing & Estimates
• Expense Tracking
• Double-Entry Accounting
• Bank Account & Credit Card Integration

Pros of Wave

• 100% free accounting, invoicing, and receipt scanning tools
• Simple and clean interface that’s easy to use
• No hidden charges for essential features
• Bank integration and automatic transaction import
• Secure cloud-based access from anywhere

Cons of Wave

• No inventory or payroll in India
• Limited customer support
• Not ideal for growing or complex businesses
• No inventory management
• GST compliance and tax settings are not tailored for Indian businesses
• Mobile app lacks full accounting capabilities

4. Zoho Books

Zoho Books’ GST compliance, affordable prices, and extensive automation capabilities make it one of the Best accounting software 2025.   It offers everything from automated processes and financial reporting to inventory management and invoicing. Businesses can remain compliant, organised, and prepared for the future with Zoho Books’ thorough localisation for Indian customers, easy bank connection, and seamless interaction.

Key Features of Zoho Books

• Invoicing and expense management
• GST/VAT compliance
• Inventory tracking
• Multi-user access and automation
• Client portal and online payments
• Workflow Automation
• Financial Reports & Audit Trail
• Recurring Billing & Auto Reminders

Pros of Zoho Books

• Fully GST-compliant with e-invoicing, returns, and audit support for Indian businesses
• Affordable pricing, with a free plan for businesses under ₹25 lakh turnover
• End-to-end automation for recurring tasks and approvals
• Integrated inventory and project management
• Seamless integration with Zoho apps
• Affordable pricing
• Advanced features for scaling

Cons of Zoho Books

• The interface can be confusing for beginners
• Inventory features not suitable for large-scale operations
• Mobile app lacks full desktop functionality
• Learning curve for non-accounting users

5. Xero

Small businesses rely on Xero for its multi-user access, bank-level security, and scalability because of its clear interface, real-time collaboration, and strong connectors. Its automated features, such as payroll (in certain areas), recurring invoicing, and automatic bank feeds, save time and cut down on mistakes.

Key Features of Xero

• Cloud-Based Accounting
• Custom Invoicing & Quotes
• Expense & Bill Tracking
• Bank Reconciliation & Automated Bank Feeds
• Multi-Currency Accounting
• Inventory Tracking
• Financial Reporting & Budgeting Tools

Pros of Xero

• User-friendly and modern dashboard with real-time insights
• Strong collaboration features for accountants, clients, and teams
• Highly scalable for growing businesses and global teams
• Excellent third-party integrations with payment gateways, CRM, eCommerce, and POS systems
• Powerful reporting with customisable KPIs and tracking categories

Cons of Xero

• Not fully localised for Indian GST or tax compliance
• Higher pricing compared to local Indian tools like Zoho Books
• Payroll is available only in select countries (not India)
• May feel complex for freelancers or very small businesses

Comparison of Best Accounting Software 2025

The comparison table below displays the potential of top accounting software for small businesses in 2025:

Software	Ideal For	Starting Price	Free Plan	Structure	Mobile App
QuickBooks	Small to growing businesses	₹412.37/month	30-day trial free	Cloud storage	Available
FreshBooks	Service-based workers	Starting from ₹1,601.32/month	No	Cloud storage	Available
Wave	Small businesses	Starter pack is free	Yes	Web-based cloud	Available
Zoho Books	Small businesses and startups	Starting at ₹8988/month	Yes; income less than 25 lakhs annually	Cloud software	Available
Xero	Growing small businesses	Starting at ₹585.66 /month	No	Cloud storage	Available

How to Choose Accounting Software for Small Business

Selecting easy-to-use accounting software starts with understanding your business needs and budget. Here are the elements that make the best accounting software:

• Cost: Look for software that fits your budget. Some accounting tools are free or low-cost, while others with advanced features may be more expensive. Compare the tools and choose that fits your needs and pocket, likewise.
• Scalability: Choose an accounting tool that can grow with your business. As your operations expand, the software should accommodate additional features and handle increased data without compromising performance.
• Customer Support: Some best accounting tools for small businesses offer reliable customer service. Ensure that the tool provides technical support when you face issues or need assistance with the software.
• Business Needs: Determine the size of your business and the industry you operate in. Identify specific features you require, such as invoicing, payroll, or tax filing. Understanding your business and accounting needs will help in selecting software that aligns with your operations.

Benefits of Using Accounting Software for Small Businesses

Accounting software offers useful features that easily run your business. From sending invoices automatically to tracking your cash flow, it helps you stay organised and save time. Here are some key benefits of using the best accounting software 2025:

• Tracks cash flow, profit, and overall financial health in one place.
• Reduces manual errors through automated calculations.
• Offers real-time financial reports to support smart decisions.
• Ensures accurate tax filing and compliance with local laws.
• Supports better planning with clear insights and forecasts.

Conclusion

The key benefit of the popular accounting software for small businesses is that it helps you achieve more objectives than just accounting. The right tool helps you track income, manage expenses, and save valuable time. Whether you want user-friendly accounting software or need help with tax compliance, make sure to pick the one that fits your business size, needs, and budget.

Looking for low-interest business financing to keep your cash flow in check? Apply for a small business loan with FlexiLoans and meet all your business objectives. FlexiLoans offers up to ₹50 lakh with interest rates starting from just 12%.

FAQs about Accounting Software for Small Business