Best Accounting Tools and Software for Sole Traders in Australia

Managing a business as a sole trader in Australia comes with a lot of responsibilities. One of the main challenges sole traders face is managing their finances, keeping track of expenses, and meeting Australian Taxation Office (ATO) requirements. While hiring an accountant is an option, many small businesses and freelancers may not be able to afford the ongoing fees. This is where accounting software becomes a practical solution.

The right accounting tool and software help you automate bookkeeping, generate invoices, track GST, and even submit your BAS (Business Activity Statement) easily. But with so many options available, how do you choose the best one for your business?

In this guide, Ausfirst Lending Group will walk you through the best accounting software for sole traders in Australia, what features to look for, and how to choose the right one for your needs.

Key Features Every Sole Trader Needs in Accounting Software

Selecting the right accounting software is one of the smartest investments you can make as a sole trader. Here are the essential features to look for in accounting software for your business:

Ease of Use

Not everyone is an accountant, and your software shouldn’t feel like one, either. Choose an intuitive, user-friendly platform that doesn’t require advanced accounting knowledge. A simple dashboard, easy navigation, and minimal learning curve can save you hours each week.

GST & BAS Compliance

If your annual turnover exceeds $75,000, you’re required to register for GST and lodge Business Activity Statements (BAS). Choose ATO-compliant accounting software that automatically tracks GST on sales and purchases, making tax lodgment effortless.

Invoicing & Payment Tracking

A good accounting tool should allow you to create and send invoices, accept online payments, and track overdue invoices in real-time. Customisable invoice templates and automatic payment reminders can improve cash flow and reduce late payments.

Integration with Banks & Apps

Accounting software with automated bank feeds connects to your bank, automatically importing transactions and matching them to your records. This saves time, reduces errors, and keeps your finances accurate and up to date.

ATO Integration

Having direct integration with the Australian Taxation Office (ATO) means you can lodge BAS, GST reports, and Single Touch Payroll (STP) submissions directly from your software. This feature simplifies tax compliance and reduces the need for manual paperwork.

Cloud-Based Access

Running a business on the go? Cloud-based accounting software gives you the flexibility to view and manage your financial data from anywhere using a laptop, tablet, or smartphone. This is especially useful for freelancers, consultants, and tradespeople who need mobile access to invoices and reports.

Affordability

As a sole trader, every dollar counts. Many accounting software providers offer affordable monthly plans or even free trials, allowing you to test features before committing. Look for software that provides the best value for your business needs without unnecessary extra costs.

By choosing accounting software with these key features, you can manage your finances more efficiently, stay tax-compliant, and focus on growing your business with confidence.

Top Accounting Tools and Software for Sole Traders

Now, let’s take a look at some of the most popular and best accounting software in Australia, perfect for sole traders, freelancers, and small business owners.

1. Xero – Best Overall for Sole Traders

Pricing: Starts at AUD $32/month.

Best for: Small businesses & freelancers who need scalable accounting software.

Xero is a great choice for sole traders who need easy GST and BAS reporting with room to grow. As a cloud-based platform, it provides real-time access to your financial data from anywhere. It also integrates directly with the ATO, making tax compliance simple. With advanced invoicing, bank reconciliation, and detailed reporting, Xero helps you stay on top of your finances with ease.

2. MYOB – Best for GST & Tax Compliance

Pricing: Starts at AUD $5/month for basic plans.

Best for: Sole traders needing strong ATO-compliant tax features.

MYOB is a great option for sole traders who need payroll features along with GST and BAS support. It handles Single Touch Payroll (STP) reporting, ensuring compliance with ATO requirements. MYOB easily connects to bank accounts, allowing for automatic transaction imports. It provides both desktop and cloud-based options, allowing users to manage their accounts in a way that best fits their workflow.

3. QuickBooks – Best for Freelancers & Small Businesses

Pricing: Starts at AUD $22/month.

 Best for: Freelancers who want a budget-friendly, feature-rich solution.

QuickBooks is ideal for freelancers and service-based businesses that need customisable invoices and payment tracking. It automatically tracks GST and generates BAS reports, making tax time easier. The mobile app provides on-the-go access, allowing you to manage invoices, expenses, and reports from anywhere. QuickBooks is a user-friendly option for those who want a simple yet powerful accounting solution.

4. Reckon – Best Budget-Friendly Accounting Software

Pricing: Starts at AUD $12/month.

 Best for: Sole traders who need affordable, flexible accounting software.

Reckon is a cost-effective accounting solution designed for sole traders who need the essentials without the high price tag. It supports GST and BAS reporting, making tax compliance straightforward. With simple invoicing and expense tracking features, it provides a no-fuss approach to managing finances while keeping costs low.

5. Rounded – Best for Australian Freelancers

Pricing: Starts at AUD $19.95/month.

 Best for: Australian freelancers needing a simple & affordable accounting tool.

Rounded is an Australian-made accounting tool designed specifically for sole traders, freelancers, and creatives. It offers simple invoicing, GST tracking, and bank reconciliation, making financial management hassle-free. With local customer support, Rounded ensures users get the help they need quickly. It’s a great option for those who want a simple and customised accounting solution.

6. Zoho Books – Best for Automation & Integrations

Pricing: Starts at AUD $15/month (Free plan available for businesses earning less than $50,000/year).

 Best for: Sole traders who want automated accounting features & app integrations.

Zoho Books is an affordable, cloud-based accounting software that offers automation for invoicing, expense tracking, and tax calculations. It supports BAS and GST compliance while integrating with Australian banks for seamless transaction reconciliation. Zoho Books is ideal for sole traders who want automated workflows and detailed financial insights without breaking the bank.

7. FreshBooks – Best for Client Management & Invoicing

Pricing: Starts at AUD $24 per month.

 Best for: Sole traders & freelancers who need professional invoicing & client management.

FreshBooks is a great choice for freelancers and service-based businesses that need professional invoicing, time tracking, and expense management. It simplifies payment collection, allowing clients to pay directly through invoices. FreshBooks also supports GST tracking and financial reports, helping sole traders stay organised and tax-ready. Its user-friendly interface makes it a favourite among non-accountants.

8. Wave– Best Free Accounting Software

Pricing: Free (Paid plans available for payroll and payment processing)

 Best for: New sole traders who need basic accounting tools at no cost.

Wave is a 100% free accounting solution that provides essential features like invoicing, expense tracking, and financial reporting. It’s perfect for sole traders and freelancers who want basic accounting tools without monthly fees. While it doesn’t offer built-in GST or BAS reporting, it’s still a solid option for those looking for a no-cost way to manage their finances.

Why Sole Traders Need Accounting Software

Running a business as a sole trader means managing every aspect on your own, including client work, finances, and tax responsibilities. Unlike larger businesses that have dedicated accountants, sole traders often find it challenging to stay on top of financial management, GST tracking, and ATO compliance. Accounting software simplifies these tasks, reducing errors and saving time.

Whether you’re a freelancer, consultant, or small business owner, investing in accounting software can make a huge difference. Here’s how:

• Save Time – Automate invoicing, expense tracking, and reporting
• Increase Accuracy – Minimise errors in GST and financial records
• Simplify Tax Compliance – Manage BAS, GST, and ATO requirements
• Improve Cash Flow – Track income, expenses, and overdue payments
• Gain Insights – Generate reports for smarter decisions

Investing in the right accounting software saves time, ensures tax compliance, and enhances business efficiency. The best choice depends on your budget, business requirements, and level of accounting knowledge.

How to Choose the Right Accounting Software for Your Business

Choosing the right accounting software is an important decision for sole traders. Here are some tips for choosing accounting software to help you make the best decision for your business:

1. Identify Your Needs & Keep It Simple

Determine if you need basic invoicing, expense tracking, BAS reporting, or payroll. Choose user-friendly software with a simple interface and mobile access to simplify bookkeeping.

2. Automate & Save Time

Look for automated invoicing, bank reconciliation, and tax calculations to reduce manual work. Automation helps manage finances efficiently, giving you more time to focus on your business.

3. Ensure Tax Compliance & Scalability

If registered for GST, choose software that supports BAS lodgement and Single Touch Payroll (STP). Choose a scalable solution with add-ons like inventory, payroll, and third-party integrations to support your business growth.

4. Go Cloud-Based for Accessibility

Cloud-based software allows you to manage finances anywhere, collaborate with accountants, and ensure secure backups without manual updates.

5. Compare Pricing, Support & Reviews

Assess costs, ensuring no hidden fees for payroll or integrations. Look for reliable customer support and read user reviews to find a trusted solution.

6. Test Before Committing

Take advantage of free trials or demos to ensure the software fits your workflow before making a decision.

To help you choose the best software, here’s a comparison table summarising key features, pricing, and compliance:

Stay informed! Prices can change, so be sure to check the official websites for the latest updates. If you’re unsure which accounting software is right for your business, our finance broker can help. Contact us today for expert advice!

Choose the Right Accounting Software with Confidence

Choosing the right accounting software is important for sole traders in Australia to manage finances, automate invoicing, track GST, and stay tax-compliant. With options ranging from budget-friendly software to more advanced tools, it’s important to consider ease of use, automation, ATO integration, and scalability before making a decision.

Many providers offer free trials, so testing a few can help you find the best fit. If you’re unsure which software suits your business, Ausfirst Lending Group is here to help. We understand the unique financial challenges sole traders face and can provide guidance to support you in making informed decisions.

Managing your business finances doesn’t have to be complicated. With the right tools and support, you can manage your finances efficiently and focus on growth. Get in touch today to find the best finance for sole traders.