Software, SaaS & App Development Accountants
One of the biggest challenges faced by businesses in the software, SaaS, and app sector is keeping up with the pace of their business growth.
Accountants for Software, SaaS & App Developers
- Are you looking for funding and need to inform investors?
- Are you considering a project and need to forecast the financials?
- Are you wondering if R&D Tax Relief might apply to you?
- Are you looking to define a profitable exit strategy?
How We Can Help
CORE SERVICES
Accounts & Tax Preparation: This is a given, and we do it well, giving you peace of mind that everything is in order.
Strategy & Planning: We help you understand what the numbers mean so you can make the right decisions for your business.
Day-to-Day Bookkeeping: Don’t let the admin work distract you from running your core business.
Xero: We are Xero Certified, so you can leverage the UK’s leading cloud-based accounting platform.
SPECIALIST SERVICES
SOFTWARE, SAAS & APP DEVELOPMENT FIRMS
Cashflow Forecasting: This is especially important for tech businesses in the development and growth phases.
Tax Efficiency: Make sure you’re not overpaying tax and are leveraging the R&D tax relief that’s available.
Reporting for Investors/Funding: Compelling business plans and forecasts help you source the capital you need.
Revenue Recognition/Analysis: For PaaS, IaaS, SaaS, Hosting, and Software Maintenance, it’s critical to calculate and understand your sticky revenue versus project-based fees.
Longer-Term Strategic Planning: Your future goals might include running the business long-term, having an exit plan, or gaining institutional investment.
Our clients in the Software, SaaS & App sector include:
- Software design
- App development
- eCommerce
- Digital platform innovators
- SaaS providers
- Tech startups
- Investor-backed companies
- Seed companies.
FAQ’s from Software, SaaS & App Development businesses
No — and this is the single most common adjustment we make for software clients. Cash in the bank isn’t revenue earned. That £24,000 is a liability until you deliver the service, so £2,000 is recognised each month and the balance sits in deferred revenue on your balance sheet. It matters more than it sounds: getting it wrong overstates profit, distorts your growth trend, and is one of the first things an investor’s diligence team will test.
Because they’re measuring different things, and both can be right. MRR is a forward-looking commercial metric based on contracted recurring value. Statutory revenue is what you’ve actually earned in the period under UK GAAP, after deferrals, discounts, mid-term upgrades and any non-recurring items. Problems only start when nobody can explain the difference. Every software business should be able to bridge from MRR to reported revenue on a single page — if you can’t, something needs looking at.
Almost certainly, yes. Following the FRC’s periodic review, amendments to FRS 102 apply to most accounting periods beginning on or after 1 January 2026. They introduce a five-step revenue recognition model closely based on IFRS 15, and bring most leases onto the balance sheet. For a subscription business with bundled contracts, setup fees, usage-based elements or discounts, this is a substantive change rather than a presentational one — and it starts with how your contracts are written.
Usually by spreading them across the contract term rather than recognising them upfront. A £5,000 setup fee feels earned at go-live, but if the onboarding has no standalone value to the customer without the subscription, it isn’t a distinct performance obligation — so it follows the subscription. The same logic applies to migration work, training and configuration. Instinct points the wrong way here, which is why it’s worth settling your policy before the invoices go out rather than after.
It depends on whether they’re a business or a consumer. For B2B sales, the place of supply is generally where your customer belongs, so you don’t charge UK VAT and they account for it under the reverse charge — but you need evidence they’re genuinely in business, ideally a validated VAT number captured at the point of sale. For consumers, VAT is due where the customer lives, which usually means registering for the EU’s One Stop Shop scheme.
Not for cross-border digital sales, no — and this catches people out regularly. The UK registration threshold is £90,000, but for digital services sold to consumers in other countries there is no equivalent small-business threshold. Sell a £30 monthly subscription to a consumer in Spain and Spanish VAT is due from the very first sale. You’re also expected to hold two pieces of evidence establishing where each consumer is located, which is easier to build into signup than to reconstruct later.
Quite possibly, even without a US entity or any staff there. Individual states can require registration based on economic nexus — dollar value or transaction count thresholds — and software is taxable in a growing number of them, on differing definitions. A handful of US customers can create filing obligations in several states at once. It’s worth mapping your exposure before the customers arrive rather than discovering it during a funding round.
Often yes, but the rules have changed repeatedly and HMRC’s scrutiny of claims has increased sharply. For accounting periods beginning on or after 1 April 2024 most SMEs claim under the merged scheme, with enhanced support available for loss-making, R&D-intensive companies. What decides a claim now is the quality of contemporaneous evidence — which engineers tackled which technical uncertainties, in which sprints, and what they were trying to resolve. Your ticketing system is, in effect, a tax record.
You can capitalise development spend that meets the recognition criteria, but it’s a policy choice rather than a default — and it has consequences. Capitalising moves cost off the P&L and onto the balance sheet as an intangible asset, which changes your reported results and how investors read your burn rate. It also interacts with your R&D claim. Take a considered position, document it, and apply it consistently, rather than capitalising when the numbers need help.
Not as a single net figure, which is the usual mistake. A Stripe payout bundles several distinct movements — gross customer receipts, processing fees, refunds, chargebacks and any reserve held back — and each needs recording separately. Post the payout net and you understate both revenue and costs, lose your gross margin figure, and leave a Stripe clearing account that never reconciles. Set up properly in Xero it runs largely automatically; retrofitted a year later it’s a rebuild.
Potentially a permanent establishment — a taxable presence in Germany bringing local payroll, social security and corporation tax obligations with it, depending on what the person does and how they’re engaged. Using a contractor arrangement isn’t an automatic way around this. There’s also the practical question of paying them compliantly. It’s a far cheaper conversation before the offer letter goes out than after the first tax year closes.
The things diligence always tests: a deferred revenue schedule that reconciles to the ledger, a documented revenue recognition policy applied consistently, clean cross-border VAT treatment, R&D claims that stand up to scrutiny, and reporting where the commercial metrics tie back to the statutory numbers. None of it is glamorous, and all of it is significantly cheaper to sort out at twenty customers than under time pressure at two hundred. We’d rather help you get ahead of it.
Every business is different and the above is general guidance rather than advice on your circumstances. Tax rates, thresholds and reporting requirements change — please get in touch and we’ll talk through where you actually stand.
We make it easy to get started with Atek
Whether you’ve reached the stage of needing an accountant for the first time or you are looking to switch from your current accountant.
