How to switch accounting software without losing data

To switch accounting software without losing data, choose a conversion date, export everything from the old package, and enter opening balances in the new one from a trial balance dated the day before. Then check the two trial balances match, and keep a full archive of the old records for the period HMRC requires: 6 years for companies and VAT, and at least 5 years after the 31 January deadline for sole traders.

What does “not losing data” mean?

It means two things: your new books start from the right balances, and you can still produce your old records if HMRC asks. Most providers move balances and recent transactions only, not your full history. The old data has to be kept somewhere else.

How long must you keep the old records?

You must keep records for the full statutory period, even after you cancel the old software. The periods are set out on GOV.UK.

Companies must keep records longer if HMRC has started a compliance check or a return was filed late. HMRC can fine a company £3,000 for not keeping accounting records, and a director can be disqualified. For a sole trader, records for 2022 to 2023 must be kept until at least the end of January 2029.

When is the best time to switch?

The cleanest switch is at the start of a financial year or a VAT quarter. You can switch at any time, but a year-end or quarter-end date means fewer part-period transactions to move. If you run payroll, the start of the tax year on 6 April avoids moving year-to-date figures.

Step by step: how to switch

1. Pick a conversion date. Use the first day of a VAT quarter or financial year where you can.
2. Finish the old period. Reconcile every bank account and file the last VAT return from the old software.
3. Run the reports. Export a trial balance dated the day before your conversion date, aged debtors, aged creditors, the VAT report and fixed asset register.
4. Export the full ledger. Download the general ledger, contacts, invoices and bills as CSV or PDF for your archive.
5. Set up the new package. Enter your accounting dates and VAT scheme, then connect your bank feed.
6. Import contacts first. That lets you assign unpaid invoices and bills to the right customer or supplier.
7. Enter opening balances. Use the trial balance, then enter each unpaid invoice and bill so the debtor and creditor totals agree.
8. Check the trial balance. The new opening trial balance should match the old closing one line for line.
9. Grant HMRC authority. Link the new software to HMRC for MTD.
10. Cancel the old subscription last. Only after the archive is saved and the new figures agree.

What should you export before you cancel?

Export everything you would need to answer an HMRC enquiry, because access often ends with the subscription. Keep:

• the general ledger and trial balance for every year
• sales and purchase invoices, and receipt images
• VAT returns and the VAT reports behind them
• bank reconciliations
• payroll reports, payslips and P60s
• fixed asset and depreciation records

Store the files in at least two places, such as cloud storage and an external drive.

How do MTD rules affect the move?

Making Tax Digital for VAT requires digital links between programs. VAT Notice 700/22 lists CSV import and export, XML and file upload as digital links. It says copy and paste is not a digital link, so import data rather than retyping or pasting it.

The new package will ask you to grant authority to HMRC. HMRC’s VAT software guidance says that authority lasts 18 months, and you can withdraw the old software’s permission. The same applies to MTD for Income Tax; see our guide to MTD income tax software.

How do you move payroll safely?

Keep each employee’s payroll ID if the new software allows it. HMRC’s GfC22 guidance, published 22 October 2026, says to select the “payroll ID changed” indicator on your FPS and enter the old payroll ID exactly as used before. If HMRC cannot link the two, it may treat the employee as starting a new job, creating duplicate records and disputed charges.

Do not set up existing staff as new starters. Enter their year-to-date pay and tax code instead. Our list of payroll software for accountants compares options.

What help do providers offer?

Most providers give guidance and some offer free migration. When we checked on 6 November 2026:

• FreeAgent says on its switching page that its bank feed imports up to two years of transactions, and that opening balances come from your trial balance.
• Xero offers accountants and bookkeepers a free migration service from Sage, QuickBooks, KashFlow and FreeAgent.

To choose a new package, see FreeAgent vs QuickBooks and Xero vs QuickBooks vs Sage.

Frequently asked questions

Can I switch accounting software in the middle of the year?

Yes. Use a trial balance dated the day before your switch date as opening balances, and enter unpaid invoices and bills separately.

Will my old data transfer automatically?

Usually only balances, contacts and recent bank transactions transfer. Export and archive the full history from the old package before you cancel.

How long do I need to keep records from my old software?

Companies keep records for 6 years from the end of the financial year, and VAT records for at least 6 years. Sole traders keep them for at least 5 years after the 31 January deadline.

Can I copy and paste data into new software for MTD?

No. HMRC says copy and paste is not a digital link; use a CSV import or other digital transfer.

What happens to payroll if I change software?

Tick the payroll ID changed indicator on the FPS and enter the old payroll ID, so HMRC does not create duplicate employment records.