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What sole traders actually need from accounting software

As a sole trader in New Zealand, you're responsible for:

You don't need payroll software for yourself. You don't need multi-currency unless you invoice overseas. What you need is something that tracks income and expenses, reconciles your bank feed, and makes GST and tax time less painful.

Most tools are built for small businesses with employees, and that adds cost and complexity sole traders don't need.

The real options for NZ sole traders in 2026

Hnry: best if you want someone else to handle everything

Cost: 1% + GST of every payment into your Hnry account, capped at NZD $1,500 + GST per year (source: hnry.co.nz/pricing, May 2026)

Hnry is a NZ-only service built specifically for freelancers and sole traders. It's not traditional accounting software; it's closer to a managed tax service. Every time a client pays you, Hnry takes its 1% fee, deducts your tax (income tax, ACC, GST) in real time, and deposits the rest to your bank account. At the end of the year, Hnry files your tax return.

The fee cap matters. If you earn more than NZD $150,000 a year, the 1% fee would exceed $1,500, so you pay the cap. For anyone earning over that threshold, Hnry becomes very good value. For someone earning NZD $60,000, it's $600 + GST a year, which compares well to the cost of an accountant and accounting software separately.

What Hnry doesn't do well: it's not a full accounting platform. You can't run reports across years, manage client jobs, or integrate with third-party tools the way Xero does. If you want to hand off your books entirely and never think about tax, Hnry is excellent. If you want control and visibility, it may feel limiting.

Best for: Freelancers, contractors, and sole traders who want zero tax admin. Works best when most of your income comes through the Hnry account.

Xero Ignite: best DIY option for NZ sole traders

Cost: NZD $55/month + GST (source: xero.com/nz/pricing-plans, May 2026; often 80% off for first 3 months for new customers)

Xero dominates NZ small business accounting and for good reason. Its IRD integration is the best available. GST returns file directly from the platform in minutes. Bank feeds from every major NZ bank (ANZ, BNZ, ASB, Westpac, Kiwibank) update automatically.

Xero Ignite (the entry-level plan) gives you:

The 20 invoice limit is a real constraint. If you invoice clients more than 20 times a month, you'll need Grow at NZD $83/month + GST.

At $55/month, Xero Ignite costs NZD $660/year + GST. That's more than Hnry if your income is under $66,000 a year. Above that, Hnry's 1% fee exceeds $660, so Xero starts making more sense on cost alone (assuming you handle your own tax return, or pay an accountant around $300-500 a year for year-end filing).

Most NZ accountants are Xero Partners, meaning they can access your data directly. If you already work with an accountant, they've probably already told you to get on Xero.

Best for: Sole traders who want control over their books, send fewer than 20 invoices a month, and are comfortable doing their own bank reconciliation.

Try Xero at xero.com/nz.

MYOB Business Lite: solid alternative, worth comparing

Cost: NZD $157.50/year + GST in the first year (promo price as of May 2026), then NZD 315/year + GST( 26.25/month). Source: myob.com/nz/products/myob-business

MYOB is the other major NZ-capable accounting platform. Business Lite is their sole trader and micro-business plan, covering up to 2 employees. It includes:

At $315/year after the promo, that's $26.25/month, noticeably cheaper than Xero Ignite at $55/month. The trade-off: MYOB's ecosystem is smaller. Fewer NZ accountants work in MYOB day-to-day, and the bank feed quality has historically been a step behind Xero, and MYOB has invested in improving this, but Xero still leads on IRD integration depth.

If the price difference matters (and NZD $340/year is real money), MYOB Lite is a legitimate option for a sole trader with simple needs.

Best for: Budget-conscious sole traders who don't work with a Xero-aligned accountant and don't need deep IRD automation.

Wave: free, but not ideal for NZ

Cost: Starter plan is free; Pro plan is USD $16-19/month (~NZD $26-31/month at current exchange rates)

Wave is popular in the US and Canada, but it's not built for New Zealand. It doesn't support GST filing to IRD, doesn't have NZ bank feeds, and prices in USD (not NZD). You'd need to manage GST yourself and file manually, which removes most of the time-saving benefit of accounting software.

Wave is genuinely good if you only need invoicing and basic bookkeeping and you're not GST-registered. If you're GST-registered, don't bother. The IRD integration gap is too big.

Best for: Non-GST-registered sole traders who want free invoicing only. Not recommended once you're GST-registered.

Which one should you pick?

Here's the clearest breakdown:

Under NZD $60,000/year income, don't want tax admin: Hnry. The 1% fee (under $600/yr) covers your taxes AND filing. You pay less than a Xero subscription + accountant combined.

Under NZD $60,000/year, want to DIY and learn your numbers: MYOB Lite. Cheapest real option with NZ compliance. Or try Xero Ignite at the 80% promotional rate (effectively $11/month for three months).

60, 000−150,000/year income, 20 or fewer invoices/month: Xero Ignite. Most NZ accountants use it, IRD integration is best in class, and the cost is reasonable relative to your revenue.

60, 000−150,000/year, more than 20 invoices/month: Xero Grow at $83/month + GST. The Ignite invoice cap will frustrate you.

Over $150,000/year: Hnry's fee caps at $1,500 + GST and includes a full accounting service. You're getting excellent value. The alternative at this level is Xero Grow or Comprehensive with a Xero-aligned accountant, where the accountant fee is a small percentage of revenue.

What about just using a spreadsheet?

Plenty of sole traders do. If you're not GST-registered and earn under $60,000 a year, a spreadsheet and a good accountant at year-end can work fine. But once you're GST-registered (mandatory above $60,000 turnover), the time you spend manually reconciling and filing outweighs the cost of software.

The hidden cost of doing it manually is not just time; it's the mistakes. IRD penalties for late or incorrect GST returns are not worth the few hundred dollars a year you save on software.

Final pick

If you're starting out as a sole trader and don't want to think about tax: Hnry (hnry.co.nz). You pay 1% of what you earn, they handle everything.

If you want a proper accounting platform with full visibility and control, and you're comfortable doing your own reconciliation: Xero Ignite (xero.com/nz). Check for the new customer promo. 80% off for three months makes the entry cost very low.

Either way, get off spreadsheets before you hit $60,000 turnover. After that, the IRD doesn't give you much wiggle room.

TD
Toby Downs is an independent tech writer based in New Zealand, covering SaaS, AI tools, and business software for tpdowns.com. No paid placements, no sponsored opinions — just research.