Financial management and accounting are crucial parts of any business, no matter how complicated or time-consuming it may feel. The right sole trader accounting software can make the task significantly easier and save you hours of admin time. 

To help you understand what makes the best accounting software for sole traders, this guide will cover:

  • What is sole trader accounting software?
  • What makesCountingup the best accounting software for sole traders?
  • What does the best sole trader accounting software include?

What is sole trader accounting software?

As the name suggests, sole trader accounting software is accounting software for sole traders. These systems help you record, calculate and track your financial records over time so you stay financially healthy. 

Before accounting software, businesses had to complete these tasks manually using a written log, which is also why these tasks have been known as ‘bookkeeping’. While we still refer to it as such, more businesses now use accounting software to save time and simplify their bookkeeping.

What makes Countingup the best accounting software for sole traders?

Using sole trader accounting software like Countingup will grant you the following benefits: 

1.Save time

Bookkeeping and accounting tend to be tedious and time-consuming tasks. Without a good system in place, these tasks will eat up precious time you could otherwise spend on other aspects of your business. Countingup automates these manual accounting tasks so you can focus on selling more products or getting more clients instead.

2. Increase accuracy

Using the best sole trader accounting software means that you won’t have to manually update multiple spreadsheets and logbooks whenever you need to make a change in your records. Countingup’s two-in-one solution combines a business current account and sole trader accounting software in one simple app. 

This means that any transactions you make with your business current account will instantly update your accounting data. You’ll eliminate the risk of duplications, delays and data errors commonly associated with connecting your business current account to a separate accounting software via Open Banking. 

3. Simplifies taxes

Like all self-employed people, sole traders have to file Self Assessment tax returns to pay their taxes every year. The Countingup app provides you with running tax estimates so you know exactly how much to set aside each month. You can also give your accountant direct access to your live accounting data so they can find the data they need whenever they need it – without having to chase you with emails. 

4. Increases visibility

Countingup lets you view your ingoing and outgoing payments, business reports, invoice statuses, direct debits, tax estimates and more in one app. This means you get instant visibility over your business performance as soon as you log in. 

For example, Countingup generates accurate and up-to-date cash flow reports in your app, so you can see how your business is doing at any time. This way, you can spot and fix any issues before they become significant, determine where you’re doing well and create a plan for how to invest more in these successful methods.

What does the best sole trader accounting software include?

Countingup is a unique two-in-one business account and accounting software that empowers you to manage all your financial activities on one platform. Signing up means you get to enjoy benefits and features such as:

Free, unlimited invoicing on the go

The Countingup app lets you create an unlimited number of customised invoices, add your logo to invoice templates and send them to customers from anywhere. Once a customer pays you, you’ll receive a notification telling you it’s been paid. 

In addition, you can:

  • Match a payment to an invoice
  • Duplicate an invoice
  • Change an invoice’s due date 

For more details, check out this guide about how to invoice clients.

Tax estimates

The best sole trader accounting software allows you to view tax estimates all year round, which gives you an idea of how much you’ll have to pay when tax season comes. This way, you know how much money to set aside each month to pay what you owe and avoid any surprises when the time comes to submit your Self Assessment tax return.

Cash flow insights

Staying on top of your cash flow (money flowing in and out of your business) is key to maximising its performance. Sole trader accounting software like Countingup is the perfect tool because it automatically updates your records as money enters or leaves your business. 

Alongside invoicing on the go, Countingup also sends you real-time updates with cash flow insights to help you manage your cash flow efficiently.


In the last few years, HMRC made changes to how businesses should submit their tax returns. The Making Tax Digital (MTD) initiative aims to make business’ accounting records more accurate and traceable. 

MTD encourages companies to move away from paper-based, manual processes and transition to digital tax filing. The hope is to make it easier for individuals and businesses to get their taxes right and minimise time spent chasing mistakes regarding misfiling and claim rebates. 

Making Tax Digital will apply to a number of different taxes, including VAT, income tax, and corporation tax. Although, MTD for Corporation Tax will likely not become obligatory before 2026. 

For VAT and income tax, small businesses must register:

  • For Making Tax Digital for income tax and follow the associated rules by April 6th 2023.
  • For Making Tax Digital for VAT by April 2022, but you can do so earlier if you want.

MTD will eventually be a mandatory practice for all businesses when submitting their tax returns. That’s why you need accounting software that’s MTD-compatible, such as Countingup. The Countingup app’s digital tax filing service automatically calculates the VAT associated with your business transactions

Automatic expense categorisation

The best sole trader accounting software makes it easy to keep your financial records in order by organising your expenses for you. 

Designed to make a sole trader’s financial management simpler, Countingup has automatic expense categorisation to help you keep an accurate, digital record of your business expenses. With HMRC approved categories, Countingup’s automatic expense categorisation feature helps to keep your financial records organised. 

Receipt capture tool

Digging through boxes of receipts to find the right one can be a nightmare, which is why you want accounting software that helps you keep receipts organised day-to-day. 

Countingup does just that. The app has a handy receipt capture tool that allows you to take a picture of your receipt with your smartphone or tablet. The system then captures the information and stores the receipt in the relevant category. This way, you’ll never have to dig around for a receipt again!

Start using Countingup’s sole trader accounting software today

Countingup’s sole trader accounting software helps thousands of small businesses keep on top of their financial management. Designed specifically for one-person businesses, this unique two-in-one app makes running your business much easier and will save you from spending hours of time on financial admin. 

Keep your business finances running like clockwork. Download the Countingup app today.