Software dilema

Quick Books, Xero or other ?

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A close relative has asked me to do Bookkeeping for his newly formed company. I am in dilemma of which software to choose considering that they will need CIS module and Payroll.

My favourite is Sage but is too expensive, although I can see the company grow.

Having looked online options seem sort of obvious; Quick Books or Xero.

Please help / advice.

 

Replies (27)

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By Hugo Fair
29th May 2023 17:48

Unofficial rules (aka general recommendations):
1. Don't do paid professional work for family and close relatives/friends.
2. Don't do professional work (as opposed to one-off comment) without pay.
3. Combine 1 and 2 above.

Also, don't undertake work for which you don't already have the requisite experience & skills.
I only mention that because Payroll with CIS may not be massively complicated, but it has the potential to go really badly wrong (because of factors outside your control).
So it's important you have plenty of experience to fall back on ... and, if you do, then presumably you'll know which of the many competitors' offerings leave you feeling comfortable?

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By An_a
29th May 2023 18:04

I have 20+ years experience, already working for a big constrction company. Thanks anyway.

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Replying to An_a:
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By Hugo Fair
29th May 2023 19:11

You're missing my main point (aside of the generally accepted 'never work for friends or family') ... which was not meant to question your depth of experience, but it's potential relevance to the work you appear to be contemplating.

For instance:
* working as part of a team in a 'big construction company' is very different to what sounded like being the sole person managing the day-to-day books for a start-up;
* a couple of years ago you were working for a hairdressing company, which is unlikely to have had any CIS component. Obviously you may have acquired some knowledge of this in your current/newer role - may I ask in what capacity?

Different software packages have different strengths & weaknesses, which often make them less or more appropriate depending on specific needs of the business.
You definitely need to ascertain what the business needs are (which may also be affected by the opinions of the accountants who I presume have been appointed) ... and of course informed by your personal experience in the relevant processes.

Anyway, best of luck if you decide to proceed despite my comments.

EDIT: I see that DKB has made several of the same points, possibly in a style that you may find more acceptable.

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By free-rider
29th May 2023 18:11

We have c. 60 Ltd company clients working in construction and all of them are on QBO. Also, we use Brightpay for CIS returns and payroll, but in my opinion QBO is way better suited for CIS clients than Xero.

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Replying to free-rider:
By An_a
30th May 2023 10:46

Free-Rider, thank you very much.
Best
Ana

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By DKB-Sheffield
29th May 2023 19:01

IMO it's extremely difficult to advise on software. It often comes down to what you're used to, and how m7ch effort you're willing to put in to make it work.

In addition, the size of the business will affect this. You have mentioned requiring CIS and payroll. The latter takes care of itself (i.e. the business is an employer). However, CIS may be a subcontractor, contractor, or both. That may well affect your criteria.

As with free-rider, I use QBO for most clients - construction and non. I do not, however, as with free-rider use QBO payroll (and contractor CIS). My reasons will differ from yours... I run multiple payrolls and prefer the functionality of 'small payroll/ CIS bureau' systems, than having integrate payroll/ CIS (not all payroll clients are also on QBO).

QBO does have CIS embedded into it for contractors ad subcontractors (no add-ins). I can't comment about Xero as I rarely use it (but you will find many contributors on here who equally refuse to accept any alternative software product works as well as Xero). I also haven't revisited the full capability of Sage Accounting recently. Sage One was dire but I know improvements have been made! You may also want to have a look at Kashflow, or - Nomisma (now Nomi) for an all-in-one solution.

You can always do trials, and if you're not sure of how something works, I'd highly recommend that! I regularly trial software to see what's out there - particularly if a new player enters the arena - or if an existing player introduces a significantly new product.

The big question... are you handling the 'full stack' of bookkeeping, payroll, accounts, tax etc.? If not, what does your relative's accountant suggest. Personally, I don't refuse clients based solely on their choice of software... a lot do!!!

Incidentally, I'm not sure where you are getting your figures from for Sage? Sage Accounting is in the same 'ballpark' as QBO and Xero. Sage 50c is much dearer. Xero, QBO, Sage Accounting, Kashflow etc. are not comparable to Sage 50 (most entry-level cloud software isn't). If you're looking for software that will replicate Sage 50c, you're probably - only actually - looking at Sage 50c!

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Replying to DKB-Sheffield:
By An_a
30th May 2023 11:07

DKB,
Thank you for your reply.
Agree nothing compares to Sage 50, thought was me.
I was looking for all in one plus wanted to give director’s access to see reports etc.
Seems they are going to bank with NatWest, in which case I can use their recommended Free Agent software.
May have to juggle the set up but, I am already using HMRC free software for their current Payroll (as self-employed).
Business is Property Development, so they are going to hire / not provide contractors.
Best
Ana

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Replying to An_a:
John Toon
By John Toon
30th May 2023 15:00

Bear in mind that whilst FreeAgent, is both excellent (and free with a Natwest/Mettle account), it has no project management software. So if this is a requirement then you're better placed with QBO or Xero.

This kind of functionality will come with time as FreeAgent is trying to scale up out of it's freelancer niche and are working hard on building out their ecosystem to compete with others.

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Replying to johnt27:
By An_a
31st May 2023 08:37

John thank you.
Best
Ana

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Replying to An_a:
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By CardiffAccountant
04th Jun 2023 00:23

I have used FreeAgent for a few years, and although it is fine for bookkeeping/accounting, it has a very poor payroll module.

If you intend to account for CIS as a contractor paying sub-contractors, stay away from FreeAgent.

It is fine if you are a sub-contractor being paid by a contractor.

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Replying to DKB-Sheffield:
By An_a
02nd Jun 2023 16:33

DKB,
Thank you for our advice.
Best
Ana

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By the_drookit_dug
29th May 2023 21:22

I'd recommend Quickbooks Online. It's extremely versatile and easy to use.

Only areas where it comes up short against Xero are that it can't generate BACS files (I use a bespoke report + Excel macro to get round this, so no big deal), plus invoices can't be put on hold (not really a problem if used together with an Accounts Payable app).

Otherwise, it's a great accounts package.

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Replying to the_drookit_dug:
By An_a
31st May 2023 08:38

Thank you

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By ireallyshouldknowthisbut
30th May 2023 09:44

If you are ambivalent, I would use what the company accountant recommends.

They do have a company accountant, right?

If you are normally an employee they will be very helpful in getting you off in the right direction as things will already be set up and running in an existing business vs starting from scratch which is a very different story.

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Replying to ireallyshouldknowthisbut:
By An_a
31st May 2023 08:44

I am their accountant. Once things are settled, I am going to train director's daughter to do bookkeeping.
Auditor (someone I have known for years) wants to do everything!
Thank you
Ana

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John Toon
By John Toon
30th May 2023 11:06

All the cloud accounting packages already mentioned, any many that aren't, are essentially the same functionality wise. If cost is an issue, ref Sage comment, then you'll end up with QBO.

I appreciate this is a newly formed company but what other features will the company possibly need? Reporting, payment services, construction/field service management? All of this should play a part in making an informed choice rather than relying on other people's preferences which very often are a matter of choosing the green or blue pill (not quite the Matrix, but almost).

Ultimately, whatever you choose will start to make Sage look very average.

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Replying to johnt27:
By An_a
31st May 2023 08:46

John,
Many thanks for your advice.
Best
Ana

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By coops456
01st Jun 2023 10:15

I see you'll now be using FreeAgent - I use it for the sports association I am treasurer of, and find it quite user-friendly. But I've never had to use the payroll functions and have no idea how well it handles CIS subcontractors.

If you find it doesn't meet your needs and are looking for a separate payroll package, I'd strongly recommend Moneysoft Payroll Manager. We're a payroll bureau with 70+ CIS clients; Moneysoft is excellent for verification, CIS300 returns, emailing tax vouchers to subbies, etc. It's excellent value - for your scenario, it's £78 pa for up to 20 subcontractors.

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Replying to coops456:
By An_a
02nd Jun 2023 16:32

Thank you for our advice.
Best
Ana

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Replying to coops456:
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By CardiffAccountant
04th Jun 2023 00:25

I second this!

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By Nashty
01st Jun 2023 10:25

For bookkeeping and vat take a look at VT Tranasctions, its easy to use and not to heavy on the pocket, Final Accounts is also available but we haven't tested that as yet.
We use sage payroll and Cis Assist for construction industry workers.
We did look at Moneysoft for bookkeeping and cis, need to have a second look , i liked it but my staff didn't.

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Replying to Nashty:
By An_a
02nd Jun 2023 16:34

Nashty,
Thank you for our advice.
Best
Ana

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Replying to Nashty:
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By CardiffAccountant
04th Jun 2023 00:28

VT is great - been using it for years. Handles CIS like a dream. Not cloud based though. Can get around this with Dropbox or OneDrive.

Money soft for payroll. Easy to use and very helpful support.

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By listerramjet
01st Jun 2023 10:26

There are plenty of good accounting apps, but that is not the point. The challenge is in finding one that works for the circumstances, and then making it work for the circumstances. Personally I would decline politely the offer from your "close relative" as this is always a bad idea, but pragmatically I would be inclined to outsource the payroll, and ignore the fancy adds that offer simplified accounting and pointless dashboards. You need to give some thought as to transaction volumes and sources, and the short to medium term ambitions of your "close relative" for this new venture. And best advice would be to engage the services of a competent firm that has direct experience of this "industry". Once the leg work has been done then your "close relative" will be in a better position to assess ongoing requirements. Establishing a new business is no simple task, and establishing a selection of trusted advisors can make the difference between success and failure.

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Replying to listerramjet:
By An_a
02nd Jun 2023 16:32

Thank you for our advice.
Best
Ana

Thanks (0)
Morph
By kevinringer
01st Jun 2023 10:45

In most cases, the big cost of software is not the software itself, but the cost in labour of inputting the data accurately and completely.

I have been using Moneysoft Payroll Manager for years for PAYE+CIS. When a QBO client started taking on subcontractors, I decided to use QBO for CIS because I thought it would be useful being integrated with CIS. But I experienced niggles. QB support were helpful, but couldn't really address some of the problems. So I switched back to Moneysoft. This was soon after the QBO CIS module was launched, so I suspect these were teething problems typical of new software and may well be ironed out now. I've never returned to QBO CIS.

I reiterate Hugo's point. I adopt the barge-pole policy. I avoid working for family because I'm concerned about scope creep, and if problems arise (as they usually do) the impact it would have on the family relationships.

Sage 50c is my go-to software too. I know Sage is pricing 50c out of existence and lacks so many add-ons that are becoming standard in cloud software. I like its consecutive numbered audit trail and that I can easily dump the entire audit trail (complete with VAT and bank reconciliation dates) into Excel.

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Replying to kevinringer:
By An_a
02nd Jun 2023 16:31

Kevin - thank you

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