FreeAgent simplifies small business accounting like no other

Dennis Howlett recently announced a new accounting web app called FreeAgent, which looks pretty cool and seems to be approaching an age-old problem in a new way:

All the well known products and services are geared towards people who already understand the fundamentals of book-keeping. Sage, Intuit and others will argue they’ve simplified the user interface and that much of the grind of double entry has been removed. I agree. But the basic design problem remains.

From the FreeAgent Central website:

FreeAgent is an online money management tool intended for small, UK-based service businesses of 1-3 employees. This will include most kinds of freelancers, contractors and consultants. … FreeAgent will probably not be for you if you tend to sell lots of products rather than services, hold materials and stock, or handle cash as part of your business.

Sounds promising. I took the tour to learn more, and a few things stood out. First, the software allows users to upload their bank data file, provide explanations for their transactions and the software will ‘learn’ for the next time what certain transactions are. That’s pretty slick. I love software that learns me, and no doubt so will business owners, since it will allow them to focus on growing their business.

Second was the focus on taxes. For now, the service is focusing on the UK market, but plans are afoot to expand into other markets. Tax is going to be the most difficult part of this transition. FreeAgent will help business owners self assess their income tax and VAT, as well as other corporate taxes if they’re operating as a limited company. This is a key addition of value for small business owners, as it will allow them to decrease their compliance costs.

The service is still in Beta at the moment, and accounts are available for free for the time being. They are going through some hiccups however, as I was unable to log in once I’d created my Beta account, and initially it gave me a 500 error when I signed up. But that’s what Beta is for – working out the kinks.

I’ll have a full review once I get set up and check out all the features firsthand, including screen shots. I also hope to help wherever I can with their Canadian translation!