FreeAgent Review

  • 6 comments
  • Updated on:
Date Established
2007
Location
United Kingdom

Highlights:

  • Jargon-free
  • Simple to use
  • Invoicing automations
  • Inventory
  • Money-saving referral program

Overview:

In 2006, Oxford graduate and ex-RAF pilot Ed Molyneux was freelancing as an IT consultant and growing increasingly frustrated with the hours he was spending tracking time, income, and taxes in spreadsheets. He teamed up with two other freelancers, co-founders Olly Headey and Roan Lavery, and in 2007 they launched FreeAgent, a cloud-based software intended to make accounting easy.

All three founders remain with the company, Molyneux as the CEO, Headey the CTO, and Lavery the Product Director. Now based in Edinburgh, Scotland, the company has grown from three employees to 52, and serves over 40,000 clients. In 2011, FreeAgent emerged as a winner in both the AccountingWEB Software Satisfaction Awards and British Accountancy Awards (the awards were Software Vender of the Year and Software Package of the Year, respectively). And in 2013, the company again won Software Satisfaction Awards in two categories: Small Business Accounts and Expenses Management.

While FreeAgent was initially targeted exclusively to UK users, the company has US and Universal versions as well. Recent developments include an iPhone/Android app, mobile security upgrades, and bulk processing of bank transactions. In the works are additional features for FreeAgent Mobile, such as mobile timetracking, and further security updates. Check out the FreeAgent Depot for the latest developments.

FreeAgent is a simple, intuitive accounting solution that manages to avoid accounting jargon and make finances comprehensible to freelancers and small business owners. The company’s mantra is “demystifying accounting,” and I can say with all confidence that they achieve this. The software is easy to use and provides a lot of functionality in one handy package–and it’s fun. Yes, fun. FreeAgent keeps their site entertaining with gifs and pictures; but the company still backs up the lighthearted fun with a seriously competitive accounting package. With legitimate double-entry bookkeeping going on behind the scenes, FreeAgent should keep your accountant happy and will serve you better than basic expense tracking and invoicing software. If this sounds like it might be a good fit for your business, and if you’re interested in being able to use FreeAgent’s service at zero cost to your company, read on for more details.

Check out this quick introduction video to see if FreeAgent is a good fit for your company’s needs:

Pricing:

FreeAgent offers a 30-day free trial, no credit card required. After that, there’s a single pricing plan: $24/month for full access to the service. As with other online accounting software, payment is month-to-month; there are no contracts and the plan can be cancelled at any time. If you wish to commit to a year’s service, you can get a 17% discount ($240/year).

Note: The above information applies to FreeAgent’s US program only. The company uses different pricing structures for other countries; you can find the details on the company’s pricing page.

FreeAgent has a particularly appealing referral program. Sign up with a referral code for a 10% discount on the service. If you refer other users, you’ll get an additional 10% discount for each. Refer 10 and the service is free! More than that and FreeAgent may just start paying you; contact the company for details.

Web-Hosted or Locally Installed:

Web-hosted. No downloads or installation required.

Hardware and Software Requirements:

Since FreeAgent is cloud-based software, it is compatible with any OS (Mac, Windows, or Linux), so long as you have internet access. All recent versions of Internet Explorer (8+), Mozilla Firefox, Safari, and Chrome are supported. FreeAgent can also be run through the browser on any mobile device. There are apps for iPhone (iOS 7.0+) and Android (4.0+) as well.

Specific Size of Business:

FreeAgent is tailored to independent contractors, freelancers, and small businesses. You can grant access to an unlimited number of users, both within and outside of your company. FreeAgent settings allow you to customize each user’s level of access as well.

Accounting Method:

Accrual accounting.

Ease of Use:

FreeAgent is highly intuitive and easy to use. There are a couple minor problems, but for the most part I really enjoyed navigating the software.

  • Setup – This was love at first sight. FreeAgent says you can be ready to start sending invoices in as little as two minutes from signup; it took me about four. The process is incredibly simple and well laid-out. Even better, a “Top Tips” box at the side of the screen gives you important information about each step at a glance (notably what needs to be dealt with immediately and what settings can be altered later), along with a link for more help if needed. Once you’ve run through the basic setup, you’ll be directed to the dashboard, where a pop-up box provides suggestions for your next steps. Gorgeous.
  • Organization – FreeAgent is an absolute joy to use. It’s incredibly intuitive, with a clean, sensible interface and just the right amount of tips along the way; it’s nearly impossible to get lost or confused. The Overview page provides a basic dashboard that gives you a quick look at what’s happening in your accounts; there are tabs for Contacts, Work, Bills, Expenses (for sole proprietorships) or My Money (for other businesses), Banking, Taxes, and Accounting, some of which have drop-down boxes leading to more options. Additional features (such as inventory) can be found under the Settings link in the upper right-hand corner. Beside that is a search feature. At the bottom of every page, you’ll find links to the Knowledge Base, Customer Support, and Community Discussion forum.
  • Instructions and Guidance – Each time you enter a new area for the first time (invoices, bills, etc.) you’ll be greeted with a screen giving you basic information about that section. I didn’t often go scrambling for the help pages; most tasks are pretty easy to figure out. But if you can’t figure something out or are new to accounting, FreeAgent offers informational videos (no longer than four minutes) on how to create an invoice, set up a bank feed, create an expense, or work with projects and tasks. Plus, the Scottish accents of the video presenters are lovely to listen to. The Knowledge Base is also an excellent tool – well-organized, with information on just about every aspect of the program.
  • Problems – Really, I had very few complaints. The layout makes a lot of sense and for the most part, navigation is easy. Here are a couple nitpicks:
    • CSV Hassles – While csv uploads are supported, you may have to modify your file in order to do it; FreeAgent only accepts UK-formatted dates (dd/mm/yyyy). You can avoid this hassle by using other formats.

Features:

FreeAgent offers an excellent feature set, with some special treats for freelancers. Here are some of FreeAgent’s key features (for the full list, click here):

    • Overview – Dashboard is set up ideally for a quick glance at the overall state of your company’s finances and projects. It’s also pleasing to the eye with charts for cashflow, banking, invoices, expenses, and profit and loss. Color coding alerts you to upcoming and overdue invoices and bills. Overall, it’s well-laid out; easy to see important information at a glance. You can also rearrange the layout if you wish.

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    • Estimates – A great tool for providing quotes to potential clients. It’s easy to generate estimates, mark them as approved, and convert them to invoices. You can also set up an email template to accompany your estimates, with plenty of merge fields options to save you some time. Includes 10+ professional templates to choose from (or you can build your own) and all can be customized with a personal logo.
    • Time Tracking – Time can be entered manually or tracked with the software’s built-in timers. You can easily add time to invoices, with a variety of options (all time on a single line, time entries divided by task, etc.); you can also save timesheets and attach them to invoices, or create reports for your own use to track the time of multiple employees. Time tracking by project is a particularly useful feature.
    • Invoicing – FreeAgent’s automated invoicing features are among the best I’ve seen in an accounting program. It is easy to set up recurring invoices, automatic payment reminders, even automatic thank you notes which can be customized and set to go out to your client when you mark an invoice as paid. You can also attach files to invoices and include an online payment option through your choice of payment processors, or you can save invoices and print to post if your company is into that. FreeAgent offers 8 invoice templates, with the option to customize if you know CSS and HTML; you can also set a default e-mail message to accompany your invoices. Very well laid out.

custom-css5

    • Bank Reconciliation – FreeAgent offers both live bank feeds and the ability to upload statements in ofx, qif, and csv formats. It supports over 4,000 banks worldwide (check to see if yours is covered here). It doesn’t support traditional bank reconciliation, though a strong argument can be made that since transactions are directly downloaded from banks and credit cards, there’s really no need for one. FreeAgent also offers the option to explain transactions and can auto-assign categories to transactions based on your history, and in my experience the feature works pretty well. (But I’d prefer to be able to actually set up bank rules.) Categorizing and matching transactions is a simple, straightforward process, though it could be a bit more efficient. Note: Like nearly all software offering live bank feeds, FreeAgent partners with Yodlee to obtain the feeds. Unlike most other software I’ve seen, the company is very upfront about addressing the fact that Yodlee may violate some banks’ T&C. Props to FreeAgent for that. Read the article here to decide whether live bank feeds are a good choice for you.
    • Accounts Payable – Straightforward bill entry, with the ability to link expenses to specific projects. Very helpful if you want to track project-based profit/loss. Easy to sort by status and pull up outstanding bills.
    • Reporting – Although limited compared to other accounting software, FreeAgent offers seven reports: Profit/Loss, Balance Sheet, Aged Debtors, Aged Creditors, Capital Assets, Show Transactions, and Trial Balance. You can download these reports in either csv or pdf format.
    • Expense Reports – Employees can enter their expenses and receipts into the system (access settings allow you to confine each employee’s view to the data they have entered). They can also enter mileage to be reimbursed at whatever default rate you set. At any time, you can view a running total of an employee’s unreimbursed transactions. However, there’s no way to mark employee expenses as approved, which will be a hassle for companies in which the person approving expenses is not the one paying them. In cases where you’ll be passing on the costs to a client, you can easily add expenses and mileage to an invoice.
    • Inventory – FreeAgent has a “Stock” area for basic inventory management. It can be found under the Settings tab. Once you set up your inventory list, stock quantities will be tracked automatically based on your invoices. The program also has a price list; unfortunately, there’s no way to integrate the two. So if you buy widgets at $1 each and sell them at $2 each, you’ll need to enter data for them in separate places: the cost and quantity of the widgets under “Stock” and the selling price under “Price List.” It’s a very clunky design. The good news is that inventory value will be properly tracked for accounting purposes.
    • Projects – One of FreeAgent’s greatest strengths is its job costing feature. You can create and track an unlimited number of projects. Projects can be customized or created directly from an estimate. Once created, you can set budgets and start/end dates. You can also break the project down into tasks, with options to track billable and unbillable time plus any expenses the project requires. FreeAgent takes all this information and merges it into a handy chart that shows your progress and profit. For small companies hoping to stay organized and on top of multiple projects, this feature is particularly helpful.

projects_screen

    • Contacts – Contacts for both suppliers and customers are easily organized under the contacts tab. Contact entries are automatically created each time you enter a new name on an invoice; you can also import your existing client list. Clicking on each entry quickly shows any incoming or outgoing invoices or bills connected to that contact. You can easily check previous or create new invoices, estimates, and projects for each entry. It also shows the overall history with contact and provides a place for specific notes.
    • Sales Tax – While this feature is just fine for UK users, it’s one of the weakest points of the software for businesses in the US. The software is really only designed to handle a single sales tax rate for any given item. If you have to deal with sales tax in multiple states (or if you need to track both local and state taxes), FreeAgent will not be a good choice for you. The universal version allows you to track a primary and secondary tax; if you live outside the UK or US, you’ll have to check this feature out to see if it’s enough to meet your needs.
    • Tax Forms and Support – FreeAgent puts your data into a Schedule C Worksheet to save you some time when taxes come due. (Unfortunately, there is no mechanism for downloading this report. If you are a Firefox user, you can attempt a workaround by using Table2Clipboard to download the data.) The program also provides automatic tracking of capital asset depreciation; enter the initial purchase and depreciation rate and the software tracks it for you. Depending on your method of calculating depreciation, the automatic tracking may or may not suit your needs; if needed, you can use journal entries instead.
    • Multi-Currency – Exchange rates are updated once per day; you can invoice and record out-of-pocket expenses in 100+ currencies, but your own accounts and bills are restricted to your base currency.
    • Payroll (UK Only) – FreeAgent supports running a monthly payroll; you can use the program to file RTI submissions to HMRC.
    • Files and Attachments – You can upload company files to your account and attach them to quotes, invoices, bills, and payments.
    • API – Developers can use the API to create their own integrations and apps.
    • Import/Export Capabilities – You can import contacts from a csv or vCard file, and of course you can also import bank statements. Additionally, you can import projects from Basecamp. You cannot, however, import a chart of accounts, inventory, or past invoices. You can export all data from FreeAgent as an Excel spreadsheet.

Customer Service and Support:

Customer support is available Monday – Friday, 9am – 5pm BST (UK time). There is limited support available on evenings and weekends. In my experience, support representatives were very helpful and directly addressed the questions I asked. Response times varied from one to three hours. Here are the support resources FreeAgent offers:

  • Phone – FreeAgent can be reached at 0131 447 0011 or 0800 025 3900. The company has no listed US support number, though new customers anywhere in the world can sign up for a free 20-minute call in which they’ll get a brief introduction to the program and the opportunity for answers to any questions they may have.
  • E-mail – Contact FreeAgent at support@freeagent.com. Emails are generally responded to within 24 hours, though I was sent a response only two minutes after emailing.
  • Social Media – FreeAgent representatives generally respond to questions on their Facebook page within 24 hours (often less). You can also follow them on Google+ and Twitter.
  • Online Help Center – FreeAgent’s Knowledge Base offers a wide variety of helpful articles and “how-to” guides. The FreeAgent blog also can be used as a training tool, though it is generally used to promote updates or announcements. There is also an extensive FAQ section, as well as a handy glossary of accounting terms. Unfortunately, some of the articles relate to the UK version of the software only, which can be confusing for non-UK users.
  • Webinars – FreeAgent offers a 30-minute Getting Started webinar each week.
  • Community Forums – Discuss problems and solutions with other FreeAgent users here. Includes a section for feature requests, as well as a forum on current common problems.

Negative Reviews and Complaints:

There’s not a lot out there in terms of complaints about FreeAgent. The software gets 3/5 stars on G2Crowd, but that’s because of a single negative review (there are only 2 reviews of the program on that site). When they do appear, these are the most common gripes:

  • Mobile Apps Lacking – The single most common complaint about FreeAgent is that the mobile apps for both iPhones and Androids are severely limited. These apps are missing key features typically available with FreeAgent, such as billing and timetracking functions. The company has said they are working on addressing these problems, the first and foremost being tracking for mobile devices. However, they give no definite date for this update’s release.
  • More Features Wanted – The second most common complaint regarding FreeAgent is that the US and Universal versions of the software lack the functionality of the UK version. Payroll support is a popular request, as well as improved support for US taxes. Although true payroll functions are included exclusively in the UK package, US users can account for payroll payout using journal entries (see if this is a viable alternative for your company here).
  • Not Really ‘Accounting Software’ – A few people have complained that FreeAgent takes the “you don’t need to be an accountant to understand our software” philosophy too far. Some say that it is missing serious accounting functionality. If you’re looking for traditional accounting software and terminology – or for the ability to generate a myriad of accounting reports – FreeAgent may not be a good match for you.
  • Limited Integrations – FreeAgent only integrates with about 30 apps and programs . . . which doesn’t sound too bad until you realize some accounting programs integrate with hundreds of applications.
  • Not Scalable – Several customers say that FreeAgent is fantastic for one-person businesses, freelancers, or small businesses of 10 employees or under, but that it is not robust enough to accommodate a business that grows beyond that point.

Positive Reviews and Testimonials:

FreeAgent has an extremely devoted user base, and rave reviews about the service aren’t hard to find. Just take a look at the company’s testimonials page or its 5/5 stars on the Chrome Web Store. FreeAgent also has 8.6/10 stars based on 21 user rankings on TrustRadius.

Here are some of the most frequent points of comment:

  • Saves Time – Users love the automatic invoicing features and streamlined accounting, and credit FreeAgent with saving them many hours of balancing the books, handling invoices, and filing paperwork.
  • Good for Non-Accountants – FreeAgent makes a point of avoiding too much specialized accounting terminology. The tone throughout the site is casual and fun while remaining professional. The software is very easy to use even with little understanding of bookkeeping.
  • Feature Selection – FreeAgent provides a much higher selection of features than many online accounting solutions, and several of these features are targeted at freelancers. Time tracking and job costing are particularly beloved offerings. One user even said, “It does everything for me and my business needs apart from making me coffee.”
  • Intuitive Design – Ease of use is a repeated point of praise.
  • Makes Accounting Fun – Don’t ask me how, but many users claim FreeAgent has done just that. Without being bogged down by complicated accounting jargon, users are able to gain control of their companies and stay on top of finances in such a way that is fun and rewarding.
  • Help and Support – Customers praise support staff and the company’s online help center for both timeliness and kindness.

Integrations and Add-ons:

FreeAgent offers roughly 30 integrations and add-ons. Some of the most notable are:

  • GoCardless – Accept payments via direct debit from clients; a low-cost alternative to accepting credit cards. You can also set up auto-billing (such as for a monthly subscription) using this integration.
  • Basecamp – A project management tool. See our review here.
  • Capsule – Customer relationship management software. See our review here.
  • MobileAgent – An iPhone app allowing you to record time and expenses on the go.
  • RightSignature – Get online signatures for estimates and invoice approvals.
  • Receipt Bank – No more data entry from receipts.

Security:

FreeAgent uses 256-bit SSL encryption, and the company’s servers are hosted by The Bunker, one of Europe’s most secure hosting providers. User data is backed up onsite every five minutes and backed up to offsite facilities multiple times per hour.

Mobile fingertouch identification and two-factor authentication have recently been added as extra security measures.

For more details on FreeAgent’s security, click here.

Final Verdict:

I was very impressed with FreeAgent the first time I checked it out, and updating this review has reinforced that impression. It offers a good variety of features while remaining simple to use and easily comprehensible to a non-accountant. The interface is very intuitive and the automated invoicing options will be a real time-saver for many businesses. The software is especially good for freelancers who have multiple clients and projects, but it will serve nearly any small business well. FreeAgent’s generous referral program also gives it the potential to be one of the most affordable accounting solutions out there.

Really, I have very few caveats about this software. The biggest one is that its primary market is still in the UK, and this is pretty obvious when you look at features and recent updates. As of the last numbers I’ve seen, FreeAgent only has about 500 US users, and while this number may grow in time, it does mean the developers are more likely to cater to the UK than the US demographic. If you’re considering FreeAgent for your business, I’d highly recommend you check out the free trial and give it a go yourself.

 

Katherine Miller

Katherine Miller

An itinerant wanderer, Katherine spent the past year in Colorado, Chicago, and New Zealand. Several years as an independent contractor have familiarized her with the headaches that often accompany small business accounting, and she’s made it her mission to find the best tools to make things a little easier for new entrepreneurs. When she’s not busy investigating the ins and outs of the latest accounting software, she can be found working on a novel, trekking up mountains, and training in Krav Maga. (Though usually not all at once.)
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6 Comments

    Phil

    Hi–are there any good online programs that use cash basis acounting? My wife and I converted our small business to an s corp……..we are small–I need something simple.

    Thanks!

    This comment refers to an earlier version of this review and may be outdated.

    Katherine Miller

    Hi Phil,

    There are several options. I’d recommend taking a look at Zoho Books, Xero, or QuickBooks Online. I’d also recommend checking out this article (How to Choose Accounting Software), if you haven’t already.

    Best of luck!
    Katherine

    This comment refers to an earlier version of this review and may be outdated.

    Denis

    Greetings Katherine
    I am in Australia and have now been looking for a while for Accounting Software. We are a two person firm. It does seem to me from reading your work that either Zero or FreeAgent would be the software for me. I liked your comments on Wave but came to the view that being a non-accountant and not wanting the hassle of bugs and lack of customer support that even though it is free it is probably not for us. What is the call between Zero & FreeAgent for the Australian scene. Presently we are under the GST threshold and are likely to remain there. The time costing expenses invoicing and payment details are the features we probably value most. Your feed back would be welcome please.

    This comment refers to an earlier version of this review and may be outdated.

    Katherine Miller

    Hi Denis,

    Thanks for your question! One of my own: you said the most important features to you are “time costing expenses invoicing and payment details.” Can you break this down for me a little more? When you say “costing,” do you mean “job costing”? Similarly, with “expenses” do you mean “tracking expenses” or “doing expense reports for reimbursement”?

    I’d be happy to weigh in, just as soon as I know a little more about your needs. =)

    Cheers,
    Katherine

    This comment refers to an earlier version of this review and may be outdated.

    Tom Hodder

    I found that freeagent was ok in 2012, but there has been little done to improve the functionality, and there are now many better and cheaper alternatives to freeagent. In addition I found their customers services to be rude and unhelpful. I am glad I switched away. (I currently using Xero)

    2

    This comment refers to an earlier version of this review and may be outdated.

    Simon

    Thanks for shedding some light on this. Another great review.

    This comment refers to an earlier version of this review and may be outdated.

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