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The ROI numbers worth tracking for accounting technology are hours saved, errors avoided, payback period and total return on what you spent. Only the last two need a formula. Say you spend $10,000 on software and setup and it gives back $6,000 a year in saved time. You’re repaid in 1.7 years, and after three years your return is 80%, about 21.6% a year.
Which accounting technology ROI metrics matter?
Four, and they shouldn’t be mixed up.
Hours saved is the raw material. Count the time you or your bookkeeper really spent on entry, matching and chasing receipts before, and the time after. Error rate is next: the number of corrections per month, which a good tool should push down. Time to close the month is a third, because a slow close delays every decision. The fourth is the money answer, and it’s where the ROI calculator earns its keep. It takes what you invested, what came back, and the years, and returns total return, return per year and payback.
Notice the order. The first three are operational and feed the fourth. If you can’t put a dollar figure on hours saved, you don’t yet have an ROI, only a hope.
How do you turn saved hours into dollars?
Multiply hours by what those hours cost you. For an employee, that’s the wage plus your share of CPP and EI, which the payroll remittance estimate shows. In Ontario, an employee paid $2,500 every two weeks costs you about $2,697.79 per pay period once your employer share is added. For the owner, use what the same hours would earn on paid work, but only if you’d really have sold them.
Here’s a made-up shop to show the arithmetic, so swap in your own numbers. Maria runs a small landscaping company in Winnipeg, and her part-time bookkeeper used to spend about 5 hours a week keying bills and matching bank lines. After the switch it’s about 2 hours. That’s 3 hours back each week. At a loaded cost of $30 an hour and 50 working weeks, 3 x $30 x 50 comes to $4,500 a year. It’s a ballpark, and it only counts as a saving if Maria actually cuts those paid hours or the bookkeeper takes on work that earns.
Be honest about that last part. Saved time only turns into money if it’s spent on something that pays, or if it lets you drop a cost. Twenty minutes a week here and there usually evaporates.
What does a worked ROI look like?
Here are two cases run through the calculator, with the same $10,000 spent and a three-year horizon. Enter the yearly cash you get back and the total value at the end.
| Case | Yearly saving | Value after 3 years | Total return | Per year | Payback |
|---|---|---|---|---|---|
| Saves real money | $6,000 | $18,000 | 80.0% | 21.64% | 1.7 years |
| Saves little | $3,000 | $9,000 | -10.0% | -3.45% | 3.3 years |
The second case is the one to take seriously. It feels like a modest gain, and on paper it’s a loss. Payback beyond your planning horizon means you’ve bought convenience, which is a legitimate purchase but not an investment. If the tool also lets you price better, the profit margin calculator shows what a change in costs does to your margin.
What should the cost side include?
More than the licence. Setup, migration, training time, the overlap period when you run two systems, and any consultant. Leave those out and the ROI looks better than it is. The calculator’s note says it ignores taxes and fees, so add fees to the amount invested yourself.
Storage belongs on the list too. The CRA says you generally have to keep your records for six years from the end of the last tax year they relate to, which is covered on its page on how long to keep business records. If a cheap plan drops your history after a couple of years, you’ll pay for an archive somewhere else.
Tax can change the net cost. The CRA’s capital cost allowance page lists general-purpose computer hardware in Class 50 at 55%, and it describes a 100% first-year deduction for certain property acquired after April 15, 2024 and available for use before 2027. That is worded as a proposal, so check the page before you count on it. Software and subscriptions are treated differently from hardware, and we haven’t confirmed the treatment for every case, so we left a tax effect out of the examples above. A bookkeeper can tell you how your own purchase is treated. The self-employed tax calculator helps if you want to see what an expense does to your tax.
How long should payback take?
There’s no official number, and we won’t invent one. A sensible rule is to compare payback with how long you expect to use the tool. If you’ll likely switch again in three years, a 3.3 year payback is a loss before you start. If you plan to stay for six, the same tool looks fine. Ask yourself how sticky the software is, then read the table above with that horizon in mind.
What goes wrong when measuring ROI?
People measure once, on day one, and never again. Measure at three months and at a year. Another habit is counting the vendor’s promised savings rather than your own before-and-after numbers. A third is ignoring adoption: if half the team still keeps a side spreadsheet, the saving is half what you thought, and there might be a second system to pay for.
We haven’t quoted any benchmark saving or software price. We couldn’t find an official source for them, and numbers from vendor surveys aren’t ours to vouch for. Use your own figures.
Where we got these figures
Return and payback figures come from our ROI calculator. The payroll figure comes from our payroll calculator with 2026 data, and the landscaping shop is invented for illustration. The capital cost allowance points come from the CRA‘s CCA classes page, read in September 2026. The ROI calculator ignores taxes and fees. No level of government runs or endorses this site.
Frequently asked questions
How do I calculate ROI on accounting software?
Take the gain (savings minus cost) and divide by what you spent. Spend $10,000, get back $18,000 over three years and the return is 80%.
What is a payback period?
The time to recover what you spent from the yearly saving. A $10,000 cost with $6,000 saved a year pays back in about 1.7 years.
What should I include in the cost?
The licence, setup, migration, training time and the overlap with your old system. The calculator ignores taxes and fees, so add fees yourself.
Do saved hours always count as savings?
Only if the time goes to paid work or removes a cost. Otherwise it's convenience.
Can I deduct accounting technology?
It depends on the purchase. The CRA lists computer hardware in Class 50 at 55%, with a proposed 100% first-year deduction in certain cases. Check the CRA page for your purchase.
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