The Ultimate Guide to Free Bookkeeping Software in Australia

Running a business in Australia, whether it’s a small startup or a growing company, involves numerous financial responsibilities. Bookkeeping is one of the most critical tasks, ensuring that your finances are organised, accurate, and compliant with tax regulations. For many small business owners, bookkeeping can be both time-consuming and costly, especially when using paid software. Fortunately, free bookkeeping software options are available that can help reduce expenses and still offer essential features.

In this ultimate guide, we will explore everything you need to know about free bookkeeping software in Australia, how it can benefit your business, and how to choose the right one for your needs. Plus, we’ll introduce you to how Priority1 Bookkeeping can support your business even further.

Why Free Bookkeeping Software is a Great Option

Free bookkeeping software is a great option for small businesses and startups, especially those looking to manage their finances without incurring high costs. It offers essential features like invoicing, expense tracking, and bank reconciliation, making it easier to stay organised and maintain accurate financial records. With no upfront investment required, free bookkeeping software helps businesses maintain cash flow while still getting the tools they need to succeed. Additionally, many free options are user-friendly and designed for those with little to no accounting experience, making it an accessible solution for busy business owners.

What is Bookkeeping?

Bookkeeping is the systematic recording and organisation of all financial transactions for a business. These records include sales, purchases, receipts, and payments. Proper bookkeeping is essential for:

• Tax Compliance: Australian businesses must meet strict ATO (Australian Taxation Office) requirements, including tracking GST and submitting BAS (Business Activity Statements).
• Cash Flow Management: Tracking income and expenses gives you a clear picture of your business’s financial health.
• Financial Decision-Making: Accurate financial records are critical when making informed business decisions.

Using bookkeeping software not only simplifies these tasks but also reduces the risk of errors and saves valuable time. Many free solutions offer a range of features that are more than sufficient for small businesses.

How bookkeeping software differs from accounting software

Bookkeeping software focuses on recording and organising daily financial transactions, such as invoices, payments, and expenses, providing a clear snapshot of your business’s cash flow and financial position. It is designed for simple tracking of financial data, primarily for internal management. On the other hand, accounting software encompasses a broader range of financial management tasks, including financial reporting, tax calculations, payroll, and compliance with regulatory requirements. Accounting software is often used for more complex tasks such as preparing financial statements and filing taxes, making it essential for businesses seeking to meet external reporting standards.

Why Do Small Businesses Need Bookkeeping Software?

Traditionally, bookkeeping was done using paper ledgers or basic spreadsheets. While this method may work for very small operations, it’s often error-prone and inefficient, especially as your business grows.

Free bookkeeping software offers small businesses in Australia several advantages:

• Automating Tasks:  Invoicing, expense tracking, and even payroll can be automated, saving you hours of manual work.
• Improving Accuracy: Software eliminates common errors in calculations and ensures transactions are properly categorised.
• Tax Compliance: Australian businesses are required to report GST (Goods and Services Tax) and submit Business Activity Statements (BAS). Bookkeeping software can generate these reports automatically.
• Saving Time and Resources: Free software allows businesses to manage their finances without needing to hire expensive bookkeeping services.

Key Features to Look for in Free Bookkeeping Software

When choosing free bookkeeping software for your small business, it’s important to consider the following features to ensure that it meets your needs:

• Invoice Management: The ability to create, send, and track invoices.
• Expense Tracking: The software should allow you to automatically or manually track business expenses.
• Bank Integration: This feature allows automatic syncing of transactions from your bank account, which reduces manual data entry.
• GST and BAS Reporting: Australian businesses need to comply with GST laws and file BAS with the ATO, so the software should support GST tracking and BAS reporting.
• Cloud-Based Accessibility: Cloud-based solutions allow you to access your financial records from any device, ensuring flexibility and data security.
• Mobile App: Some software options offer mobile apps, enabling you to manage finances on the go.

Benefits of Using Free Bookkeeping Software

1. Cost Efficiency

One of the main advantages of free bookkeeping software is its cost-effectiveness. By using free solutions, Australian small businesses and startups can save money that would otherwise be spent on expensive paid software subscriptions. This is especially beneficial for new businesses that need to conserve cash flow.

For example, rather than investing in expensive tools early on, free bookkeeping software gives you the flexibility to manage your financials at no cost, freeing up resources to invest in growth areas like marketing or product development.

2. Accessibility for Non-Accountants

Most free bookkeeping software is designed to be user-friendly, even for business owners with no accounting background. With simplified interfaces and step-by-step guidance, you can handle your bookkeeping tasks efficiently without hiring a professional accountant—although working with a service like Priority1 Bookkeeping can ensure you stay on top of more complex issues, such as tax compliance and financial forecasting.

Free software options are ideal for small businesses just starting out, but what happens when your business grows? Many free platforms offer paid upgrades with advanced features that can scale with your business as it expands. For example, you may begin with free software and later move to a more robust solution with payroll and multi-user functionality.

Top 10 Free Bookkeeping Software in Australia

1. Wave Accounting

Wave is one of the most popular free accounting platforms worldwide, offering a complete suite of bookkeeping tools. It’s an excellent choice for freelancers and small businesses due to its intuitive design and powerful features.

Key Features:

• Free invoicing, income, and expense tracking.
• Bank account integration for automatic transaction syncing.
• Financial reports like profit and loss statements.
• Receipt scanning via the mobile app.

Pros:

• Completely free with no hidden fees.
• User-friendly interface, perfect for beginners.
• Comprehensive tools for invoicing and tracking payments.

Cons:

• Limited to small businesses and freelancers; no support for inventory or payroll in Australia.
• Customer support is primarily through email.

Best For: Freelancers, sole traders, and small business owners who need basic bookkeeping without extra frills. 

2. ZipBooks

ZipBooks is another free, cloud-based bookkeeping software ideal for Australian small businesses. It offers clean, simple financial tools to help businesses keep track of their books. 

Key Features:

• Unlimited invoicing and transaction tracking.
• Bank reconciliation to match transactions with bank statements.
• Financial reporting, including balance sheets and profit & loss statements. 

Pros:

• Intuitive, easy-to-use interface.
• Free version includes unlimited invoicing and accounting features.
• Includes smart insights to help businesses understand their financial health. 

Cons:

• Limited third-party integrations.
• Paid version is required for advanced features like time tracking and team management. 

Best For: Small businesses that want easy-to-use accounting software with invoicing and basic financial reporting. 

3. Sunrise

Sunrise (formerly known as Billy) is a great option for freelancers and self-employed individuals. It offers essential bookkeeping features, such as invoicing and expense tracking, in a simple, easy-to-navigate platform. 

Key Features:

• Customisable invoicing and recurring billing.
• Simple expense tracking and categorisation.
• Automated reminders for overdue invoices.
• Basic tax management, including GST tracking. 

Pros: 

• Free version covers essential bookkeeping needs.
• User-friendly, easy to get started without any accounting knowledge.
• Strong invoicing capabilities. 

Cons: 

• Limited to small-scale businesses with basic needs.
• Few third-party integrations compared to larger software solutions. 

Best For: Sole traders, freelancers, and self-employed individuals who need simple, reliable bookkeeping software. 

4. GNUCash

GNUCash is a free, open-source accounting program that offers robust, double-entry bookkeeping features. While it’s more complex than cloud-based solutions, it provides powerful tools for those who need advanced accounting features without the cost. 

Key Features: 

• Double-entry accounting system.
• Handles both personal and business finances.
• Multi-currency support.
• Detailed financial reports, including balance sheets and income statements. 

Pros: 

• Completely free and open-source.
• Supports complex accounting needs, including double-entry bookkeeping.
• Multi-currency and tax support for global businesses. 

Cons: 

• Steeper learning curve, not as intuitive as other software options.
• No cloud access; must be installed on a computer. 

Best For: Businesses that need advanced bookkeeping features or double-entry accounting, and don’t mind a steeper learning curve. 

5. SlickPie

SlickPie is a simple, cloud-based accounting software aimed at micro-businesses and startups. Its intuitive interface makes it easy for business owners with little accounting experience to get started. 

Key Features: 

• Automated data entry with MagicBot (receipt scanning tool).
• Customisable invoicing and recurring billing.
• Simple financial reports and expense tracking. 

Pros: 

• User-friendly, perfect for beginners.
• Automation tools like MagicBot reduce manual data entry.
• Free plan includes all basic features. 

Cons: 

• Limited third-party integrations.
• Some features (like advanced reporting) are only available on paid plans. 

Best For: Startups and micro-businesses that need a straightforward, easy-to-use solution for invoicing and tracking expenses. 

6. Akaunting

Akaunting is a free, open-source accounting platform that offers full bookkeeping features for small businesses. Since it’s cloud-based, you can access your financial data from anywhere, and its extensive feature set includes everything from invoicing to inventory tracking. 

Key Features: 

• Invoicing, expense tracking, and bank reconciliation.
• Multi-currency support and customisable reporting.
• Vendor and client management.
• Supports add-ons to extend functionality. 

Pros: 

• Completely free and open-source, with cloud access.
• Supports multi-currency and global tax needs.
• Can be extended with paid add-ons for additional features. 

Cons: 

• Requires some technical knowledge to set up and customise.
• Limited support compared to paid solutions. 

Best For: Small businesses that want a customisable, open-source solution with the flexibility to scale up. 

7. NCH Express Accounts

NCH Express Accounts offers a free version of its bookkeeping software, which includes many essential features for small businesses. It’s downloadable desktop software, making it ideal for businesses that prefer offline access. 

Key Features: 

• Income and expense tracking.
• Automatic billing and invoice management.
• Recurring invoicing and customer account tracking. 

Pros: 

• Simple and straightforward, ideal for small businesses.
• Offline access for users who prefer desktop software.
• Free version covers essential accounting needs. 

Cons: 

• No cloud access; must be installed locally.
• Limited features in the free version (advanced features require payment). 

Best For: Small businesses with less than five employees that want simple bookkeeping software with offline access. 

8. Zoho Books (Free Plan)

Zoho Books offers a free plan specifically for small businesses with annual revenue under $50,000. The free plan provides all the essential bookkeeping features, making it a solid choice for businesses that are just getting started. 

Key Features:

• Invoicing, expense tracking, and client management.
• Bank reconciliation and payment tracking.
• GST and BAS reporting. 

Pros: 

• Free for small businesses under $50,000 in annual revenue.
• Includes GST and BAS reporting for Australian businesses.
• Cloud-based, with mobile access. 

Cons: 

• Limited to businesses with under $50,000 in revenue.
• Advanced features are only available on paid plans. 

Best For: Small Australian businesses with limited revenue that need an easy-to-use, feature-rich solution for bookkeeping. 

9. TrulySmall

TrulySmall is designed specifically for freelancers and micro-businesses, offering an easy, cloud-based solution for managing their books. The software focuses on simplicity, making it perfect for those who have no accounting experience. 

Key Features: 

• Invoice creation and expense tracking.
• Automatic bank transaction syncing.
• Simple reports, including profit and loss statements. 

Pros: 

• Clean, intuitive interface that’s easy for beginners.
• Automates basic accounting tasks.
• Cloud-based with mobile access for on-the-go management. 

Cons: 

• Limited features for larger businesses.
• No payroll or inventory management features. 

Best For: Freelancers and very small businesses that need a minimal, user-friendly accounting tool. 

10. Manager

Manager is a free desktop accounting software that’s available for Windows, Mac, and Linux users. It includes all the essential bookkeeping features and offers a simple, offline solution for businesses that prefer not to use cloud software. 

Key Features: 

• Double-entry accounting system with full audit history.
• Invoice management, expense tracking, and tax compliance features.
• BAS and GST reporting for Australian businesses. 

Pros: 

• Free desktop solution with full accounting capabilities.
• Supports multi-currency and global tax compliance.
• Offline access, ideal for businesses without constant internet access. 

Cons: 

• Lacks cloud-based features unless upgraded to a paid plan.
• More complex interface compared to cloud-based software. 

Best For: Small businesses that prefer offline bookkeeping and don’t need cloud access. 

How to Choose the Right Free Bookkeeping Software

Choosing the right free bookkeeping software depends on your specific business needs. Here are some factors to consider: 

1. Identifying Your Business Needs

What do you need most from your bookkeeping software? Some businesses prioritise invoicing capabilities, while others require strong expense tracking or the ability to handle payroll. Make a list of your must-have features before making a decision. 

2. Ease of Use

Consider the user interface and overall ease of use. If you’re not familiar with bookkeeping, choose a software that is designed for beginners. Look for options that offer tutorials, guides, or customer support to help you get started. 

3. Security and Compliance

Data security is critical, especially when dealing with sensitive financial information. Ensure that the software you choose uses encryption to protect your data and complies with Australian tax regulations, such as handling GST appropriately. 

4. Integration Capabilities

If you’re using other tools to manage your business, such as an e-commerce platform or payment processor, ensure your bookkeeping software can integrate with these tools for seamless financial management.

Comparing the Free Options: Which One is Right for You?

With so many options available, it’s important to evaluate your business’s specific needs when choosing the right free bookkeeping software. Here’s a side-by-side comparison of the top free options:

How to Choose the Right Free Bookkeeping Software

With so many options available, consider these factors when choosing the best bookkeeping software for your business: 

• Business Size: Are you a sole trader, a small business with several employees, or a startup? Each software option caters to different types of businesses.
• Key Features: Make sure the software includes invoicing, bank reconciliation, and GST/BAS reporting if you operate in Australia.
• Cloud or Offline: Decide whether you need cloud access for flexibility or if you prefer offline desktop software.
• Scalability: Some free options may limit you as your business grows. Choose software that can scale with you if necessary.

How to Set Up Your Free Bookkeeping Software

Getting started with bookkeeping software is straightforward. Here’s a step-by-step guide:

• Choose Your Software: Based on your business needs, pick the software that best suits your financial management requirements.
• Create an Account: Sign up for a free account. Most free bookkeeping tools only require basic information like your name and business details.
• Connect Your Bank Accounts: To streamline transaction tracking, connect your business bank accounts. This will automatically sync your expenses and income, reducing manual data entry.
• Customise Invoices: Personalise your invoices by adding your logo, business details, and preferred payment methods.
• Record Transactions: Start entering transactions such as sales, purchases, and expenses. Many software platforms will categorise these for you automatically.
• Generate Reports: After a few weeks of data, you can generate reports like profit and loss statements to track your business’s financial health. 

Bookkeeping Software and Australian Tax Compliance

One of the major advantages of bookkeeping software is how it simplifies tax compliance. Australian businesses are required to register for GST if their annual turnover exceeds $75,000, and they must submit regular BAS to the ATO. 

Most bookkeeping software in Australia, such as Wave and Sunrise, offers automatic GST tracking and can generate BAS reports. This eliminates the guesswork and manual calculations typically involved in preparing for tax time. 

Advantages of Cloud-Based Bookkeeping Software

Cloud-based software offers several benefits, including:

• Access Anywhere: You can view and update your financial records from any device, whether you’re in the office or on the go.
• Real-Time Updates: Transactions are automatically synced in real-time, providing up-to-date insights into your business’s financial position.
• Data Security: Most cloud-based solutions provide regular backups, so you won’t have to worry about losing important financial data. 

Potential Drawbacks of Free Bookkeeping Software

While free bookkeeping software is a great option for startups and small businesses, there are some limitations: 

• Limited Features: Free versions often lack advanced features like payroll, inventory management, and integration with certain third-party apps.
• Data Security Concerns: While most free platforms offer basic security features, they may not provide the same level of encryption or customer support as paid versions.
• Scalability Issues: As your business grows, you may need more advanced features that are not included in the free versions. This can require a costly upgrade to a paid plan. 

Should You Upgrade to Paid Bookkeeping Software?

As your business grows, there might come a time when free bookkeeping software no longer meets your needs. Here are some reasons you may want to consider upgrading to a paid version: 

• Advanced Features: Paid versions typically offer more advanced reporting, payroll management, inventory tracking, and integrations with other business apps like CRM or project management software.
• Better Support: Paid users usually get access to premium customer support, including phone support and personalised assistance.
• Customisation: Paid versions often come with more customisation options, allowing you to tailor the software to your specific business needs. 

Conclusion

Free bookkeeping software can be a powerful tool for small Australian businesses, offering a range of features that simplify financial management. However, as your business grows, you may find that your needs become more complex. That’s where Priority1 Bookkeeping can step in to provide personalised bookkeeping services tailored to your business. Whether you’re just starting out or expanding your operations, having expert support ensures you can focus on what matters most—growing your business.