The Tax and Accounting Software Market size is projected to grow from USD 14.3 Billion in 2024 to USD 27.1 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 8.3% during the forecast period (2024 - 2032). Additionally, the market size for Tax and Accounting Software was valued at USD 13.2 billion in 2023.
Increased growth in the usage of cloud computing solutions and technologies, increased penetration of business accounting mobile applications, andrapid industrializationin IT offices are the key market drivers enhancing the market growth.
Figure 1: Tax and Accounting Software Market Size, 2024-2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
The use of electronic accounting is driving the market growth
The increasing adoption of electronic accounting will likely bolster the cloud accounting software market growth over the forecast period. Additional factors adding to the global tax and accounting software industry growth include the different benefits such as effective planning and management of financial data in an affordable way, growing adoption in BFSI, retail and consumer goods, manufacturing, and others, the growing trend of SMEs collaborating with e-commerce companies as well as integration with other applications, like automated billing features and automated bank feeds, rise in financial transactions, digitalization, increased vigilance of tax administrators, complex nature of existing tax system, and use of block technology. This factor drives the Market CAGR.
Additionally, invoicing and billing are important business processes and the principal source of revenue for companies. If done manually, managing invoices on paper is time-consuming, prone to mistakes, and inconvenient. Making real invoices for every time a client buys from a user when a user has recurring orders is impossible. Reminding consumers of pending payments and tracking bills is challenging without automated tools. Tax and accounting software proficiently addresses these issues and provides properties that simplify invoicing. For regular client orders, users may form recurring profiles and plan invoices to be sent out immediately every time the order is placed. Consumers can also enhance payment terms and conditions to the invoices to let to know what customers expect when it comes to payments. Thus, the rising popularity of seamless invoicing and billing processes is expected to drive the market growth rate during the forecast period.
Furthermore, several high-end companies demand real-time global data availability, providing them with numerous opportunities, obligations, and risks n tax payments. To fulfill these demands, companies in the tax and accounting software market are offering platforms that help gather data from unstructured and structured sources. To capitalize on revenue opportunities, businesses offer cloud-enabled platforms, for instance, Microsoft Azure. As such, evolving players and start-ups compete with established tax and accounting software businesses. Cloud-based software platforms allow flexibility and scalability for businesses. Now, companies provide software that complies with industry standards and facilitates co-sourcing. They are innovating in software that aids users in calculating taxes as per the right service and geography. Thus, driving the Tax and Accounting Software market revenue.
The global Tax and Accounting Software market segmentation, based on type, includes accounting and tax software. The accounting software segment dominated the market due to businesses' increasing adoption of digital accounting practices across various industries. Accounting software offers efficient and automated solutions for managing financial transactions, generating reports, and maintaining accurate records. It streamlines the accounting process, reduces human errors, and saves time and resources. Additionally, accounting software provides features like budgeting, invoicing, payroll management, and tax preparation, which are crucial for businesses' financial operations.
Figure 2: Tax and Accounting Software Market, Software Type, 2022 & 2032 (USD billion)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
Based on deployment mode, the global Tax and Accounting Software market segment includes cloud and on-premise. The on-premise segment dominated the marketdue to its security, compliance adherence, customization capabilities, and offline accessibility features, making it the preferred choice for many businesses.Furthermore, On-Premise deployment allows businesses to customize the software according to their specific needs. They can tailor the software's functionalities, integrations, and workflows to align with their unique accounting processes and requirements.
Based on Vertical, the global Tax and Accounting Software market segmentation include BFSI, IT and telecommunications, healthcare, and manufacturing. The manufacturing segment dominated the market due to the industry's unique financial requirements, including complex financial operations, tax compliance needs, inventory management, and cost accounting. Tailored tax and accounting software solutions cater to these specific needs, making them the preferred choice for manufacturing businesses.Additionally, the manufacturing industry often involves complex cost accounting methods, such as activity-based and standard costing. Tax and accounting software designed for manufacturing can handle these intricate cost calculations, helping businesses accurately track and allocate costs to products and processes.
By Region, the study providesmarket insights into North America, Europe, Asia-Pacific, and Rest of the World. The Europe Tax and Accounting Software marketwill dominate this market; an increase in the strong presence of leading accounting software players will boost the market growth in this Region.Further, the German Tax and Accounting Software market witnessed the largest market share, and the UK Tax and Accounting Software market was the fastest-growing market in the European Region.
Further, the major countries studiedin the market reportare The U.S., Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 3: TAX AND ACCOUNTING SOFTWARE MARKET SHARE BY REGION 2022 (%)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
North American tax and accounting software marketaccounts for the second-largest market share. The growth in IT offices and rapid industrialization.
The Asia-Pacific Tax and Accounting Software Marketis expected to grow fastest from 2023 to 2032. This is due to expanding awareness of a healthy lifestyle and nutrition and rising per capita disposable income.Moreover, China’sTax and Accounting Software market held the largest market share, and the IndianTax and Accounting Software market was the fastest-growing market in the Asia-Pacific region.
Leading market players are investing heavily in research and development to expand their product lines, which will help the Tax and Accounting Software market grow even more. Market participants are also undertaking various strategic activities to expand their global footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, Tax and Accounting Software industry must offer cost-effective items.
Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the global Tax and Accounting Software industry to benefit clients and increase the market sector. In recent years, the Tax and Accounting Software industry has offered some of the most significant advantages to medicine. Major players in the Tax and Accounting Software market, includingKPMG International, DezanShira& Associates, Kingston & Knight Accountants, WoltersKluwer, Tally Solutions Private Limited, Red Wing Software, Inc., Unit4, Epicor, FreshBooks, TeamSystem SpA, Xero Limited, Microsoft Corporation, Oracle Corporation, SAP SE, The Sage Group, and Intuit Inc., and others in the market, are actively working to boost market demand through their investments in research and development (R&D) initiatives.
Avalara Inc (Avalara) is a technology company providing cloud-based software and other transactional tax compliance solutions.Avalara, Inc., a leading tax compliance automation software provider, acquired Indix's Al technology and expertise based in Washington, United States. This acquisition will help Avalara to offer an accurate, up-to-date, and comprehensive source of global tax combined with Indix Al capabilities.
Intuit Inc. is a prominent American software company developing financial software solutions. Based in Mountain View, California, the company is led by CEO SasanGoodarzi.In a significant move, Intuit, Inc. acquired Credit Karma, a platform designed to address consumers' financial challenges. This strategic acquisition aims to solve every day financial issues, including debt management and optimizing savings. Intuit and Credit Karma seek to enhance their offerings by joining forces and delivering comprehensive tools that empower individuals to make informed financial decisions.
DezanShira& Associates
Kingston & Knight Accountants
Tally Solutions Private Limited
Red Wing Software Inc.
Epicor
FreshBooks
TeamSystem SpA
Xero Limited
Oracle Corporation
The Sage Group
February 2019: Avalara, Inc., a leading provider of tax compliance automation software, acquired Indix's Al technology and expertise based in Washington, United States. This acquisition will help Avalara to offer an accurate, up-to-date, and comprehensive source of global tax combined with Indix Al capabilities.
February 2020: Intuit, Inc. acquired Credit Karma. This acquisition aims to solve consumers' daily financial problems, manage debt, and maximize saving.
Accounting Software
Tax Software
Cloud
On-Premise
BFSI
IT and Telecommunications
Healthcare
Manufacturing
US
Canada
Germany
France
UK
Italy
Spain
Rest of Europe
China
Japan
India
Australia
South Korea
Australia
Rest of Asia-Pacific
Middle East
Africa
Latin America
| Report Attribute/Metric | Details |
| Market Size 2023 | USD 13.2 billion |
| Market Size 2024 | USD 14.3 billion |
| Market Size 2032 | USD 27.1 billion |
| Compound Annual Growth Rate (CAGR) | 8.3%(2024-2032) |
| Base Year | 2023 |
| Market Forecast Period | 2024-2032 |
| Historical Data | 2018- 2023 |
| Market Forecast Units | Value (USD Billion) |
| Report Coverage | Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends |
| Segments Covered | Software Type, Deployment Mode, Verticaland Region |
| Geographies Covered | North America, Europe, AsiaPacific, and the Rest of the World |
| Countries Covered | The U.S., Canada, German, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil |
| Key Companies Profiled | KPMG International, DezanShira& Associates, Kingston & Knight Accountants, WoltersKluwer, Tally Solutions Private Limited, Red Wing Software, Inc., Unit4, Epicor, FreshBooks, TeamSystem SpA, Xero Limited, Microsoft Corporation, Oracle Corporation, SAP SE, The Sage Group, and Intuit Inc |
| Key Market Opportunities | The report also emphasizes the various market drivers, opportunities, market restraints, and challenges and offers insights for the forecast period. |
| Key Market Dynamics | the growth in IT offices, rapid industrialization |
Frequently Asked Questions (FAQ) :
The global Tax and Accounting Software market size was valued at USD 13.2 Billion in 2023.
The global market is estimated to grow at a CAGR of 8.3% during the forecast period, 2024-2032.
Europe witnessed the largest share of the global market
The key players in the market areKPMG International, DezanShira& Associates, Kingston & Knight Accountants, WoltersKluwer, Tally Solutions Private Limited, Red Wing Software, Inc., Unit4, Epicor, FreshBooks, TeamSystem SpA, Xero Limited, Microsoft Corporation, Oracle Corporation, SAP SE, The Sage Group, and Intuit Inc.
The Accounting Software category dominated the market in 2022.
The On-Premise had the largest share in the global market.
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Team Lead - Research she holds an experience of about 6+ years in market research and business consulting, working under the spectrum of information communication technology, telecommunications and semiconductor domains. aarti conceptualizes and implements a scalable business strategy and provides strategic leadership to the clients. her expertise lies in market estimation, competitive intelligence, pipeline analysis, customer assessment, etc.
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