8 Tips for Choosing the Right Hosting Provider for Accounting Software

Frustrated with accounting software that lags or crashes during tax season? Or worried about whether your client data is truly secure? You’re not alone.  

Many accounting professionals struggle with these problems, and the solution might be simpler than you think: choosing the right hosting provider.  

Whether you’re a CPA, managing a mid-sized accounting firm, or running a large firm, this guide will show you how to choose a hosting provider that keeps your data safe, your software running smoothly, and your clients happy. 

Why Cloud Hosting Matters for Accounting Software 

Traditional hosting keeps your accounting software installed and running on physical computers or servers within your office. You’re responsible for maintaining the hardware, software updates, and security. 

Cloud hosting, on the other hand, runs your accounting software like QuickBooks on high-performance servers housed in secure data centers. Simply connect your hosted accounting software to the internet and access it from anywhere without the burden of in-house maintenance.  

Traditional Office Setup: 

• You buy expensive servers and equipment (often $10,000-$50,000 upfront) 

• You handle all maintenance, updates, and repairs yourself 

• Your team can only work from the office 

• If something breaks, your business stops until it’s fixed 

Cloud Hosting Setup: 

• No expensive equipment to buy 

• Professional technicians handle all maintenance 

• Your team can work from anywhere with internet 

• Built-in backups and disaster recovery plans  

The shift to cloud hosting isn’t just a passing trend—it’s a business necessity, backed by compelling data. In the USA, 94% of accounting managers already use cloud services, and firms report up to a 50% reduction in labor costs through cloud accounting.

The preference is clear: 67% of accountants believe integrating cloud technology boosts business success, and more than half (53%) have adopted cloud-based practice management solutions to streamline project management and enhance client communication. 

Factors for Choosing Your Accounting Software Hosting Provider 

Here’s your step-by-step framework for evaluating any accounting software hosting provider: 

1. Security and Compliance: Your First Priority 

Security should be your number one concern when choosing a hosting provider. With nearly half (46%) of all breaches involving customer personal identifiable information, you can’t afford to take risks with client data. 

Essential Security Features to Look For: 

• SOC 2 Type II Certification: This proves the provider follows strict security controls. 

• Data Encryption: Look for AES-256 encryption (the same level used by banks). 

• Multi-Factor Authentication: Uses multiple verification methods beyond a password to grant only authorized users access to data and resources. 

• Regular Security Audits: Independent testing of their security systems to identify vulnerabilities and meet compliance standards. 

Compliance Requirements to Verify: 

• SOC 2 Type II (minimum requirement) 

• SSAE 16 certification 

• HIPAA compliance (if you handle healthcare clients) 

• PCI DSS compliance (for payment processing) 

• ISO certification 

2. Infrastructure and Performance: Keeping Your Business Running 

Your hosting provider’s infrastructure directly impacts how fast your accounting software runs and whether it’s available when needed. 

Data Center Locations: Choose cloud hosting providers with data centers close to your location for faster performance. Ask about: 

• Where are their data centers located? 

• How many data centers do they operate or partner with? 

• Whether they have backup data centers 

Uptime Guarantees: Many providers promise 99.99% uptime, which is less than 53 minutes of downtime per year. Here’s how availability breaks down: 

Availability	Annual Downtime
99%	~3.65 days
99.9%	~8.8 hours
99.99%	~52.6 minutes

For smooth financial operations, aim for at least 99.99%. Anything lower can seriously disrupt your business operations.  

Server Specifications: Your provider should use: 

• High-performance servers with SSD storage 

• Adequate RAM and processing power for your software 

• Regular hardware updates and maintenance 

Bandwidth and Speed: Ask about: 

• Internet connection speeds at their data centers 

• How much bandwidth is allocated per user 

• Whether they monitor and manage network performance 

Suggested Read: 5 Key Questions to Ask Your Cloud Provider

3. Software Compatibility and Integration 

Not all hosting providers support every accounting software. Make sure your chosen provider works seamlessly with your current tools. 

Popular Accounting Software Support: 

• QuickBooks (Desktop and Enterprise versions) 

• Sage 50, 100, 300 

• Xero (though primarily cloud-native) 

• Drake Tax Software 

• Lacerte 

• ProSeries 

• UltraTax CS 

Integration Capabilities:   

• Office 365 or Google Workspace    

• Customer relationship management (CRM) tools: Zoho, eWorks Manager, Once Accounting, etc. 

• Time tracking software: Clockify, On The Clock Time Clock, QuickBooks Time, and more. 

• Document management systems: Engagement Manager, PaperlessPlus DrakeDocuments, etc. 

4. Business Continuity and Disaster Recovery 

What happens if disaster strikes? Your hosting provider should have a solid plan to get you back up and running quickly.  

Backup Frequency: Look for providers that regularly back up your data and meet these requirements at least: 

• Multiple backup copies are stored in different locations. 

• Automated backup processes that don’t require your involvement. 

• At least 40 to 45 days of backup. 

Recovery Time Commitments: 

• RTO (Recovery Time Objective): How quickly can they restore your access after a disruption 

• RPO (Recovery Point Objective): How much data you might lose in a disaster 

• Most good providers aim for a 4-hour RTO and a 1-hour RPO 

Data Replication: Your data should be stored in multiple locations automatically, so if one data center has problems, your information is safe in another location. 

5. Support Quality and Expertise  

When accounting software problems arise, especially during busy tax season, you need expert help fast. 

24/7 Availability: Accounting work doesn’t stick to business hours, and neither should your support. Look for providers offering round-the-clock help. 

Accounting Industry Knowledge: Generic tech support can’t help with accounting-specific problems. Your provider should understand: 

• How accounting software works 

• Common accounting workflows 

• Tax season demands and deadlines 

• Compliance requirements for accounting data 

Response Time Commitments: Ask about: 

• How quickly they respond to support tickets 

• Phone support availability 

• Emergency escalation procedures 

• Average resolution times 

Support Channel Options: 

• Phone support (most important for urgent issues) 

• Email support for non-urgent questions 

• Live chat for quick questions 

• Online knowledge base and tutorials 

6. Pricing Structure and Hidden Costs 

Understanding the actual cost of hosting goes beyond the monthly fee. Here’s what to look for: 

Per-User Pricing: You pay for each person who uses the system. 

• Typical range between $35-$45 per user per month. 

• Good for teams with a consistent size. 

• Watch out for minimum user requirements. 

Flat-Rate Pricing: One price regardless of user count or business size.  

• Typical range is between $200 to $500 per month for small firms. 

• Good for growing teams or variable user counts. 

• Watch out for usage limits or storage restrictions. 

Potential Hidden Costs to Ask About: 

• Setup and migration fees 

• Software licensing fees 

• Additional storage costs 

• Backup and disaster recovery fees 

• Support charges beyond basic help 

• Early termination penalties 

7. User Experience and Accessibility 

Your accounting software cloud hosting provider should make it easy for your team to work from anywhere, on any device. 

Access Requirements:  

• Internet Browser Access: No special software is required to install it. 

• Mobile Device Support: Access from phones, PC, tablets, etc. 

• Multiple Operating Systems: Works on Windows, Mac, and other systems. 

• VPN-Free Access: Secure remote access without complicated VPN setup. 

Performance Considerations: 

• Fast login and loading times. 

• Responsive interface that works well on different screen sizes. 

• Reliable connection that doesn’t drop frequently. 

• Good performance even with multiple users working simultaneously. 

8. Vendor Reputation and Stability 

Your hosting provider should be a stable, trustworthy partner for the long term. 

Company Background: 

• How long have they been in business? 

• Are they financially stable? 

• Do they specialize in accounting software hosting? 

• What’s their track record with similar businesses? 

Customer References: 

• Can they provide references from similar accounting firms? 

• What do online reviews say about their service? 

• Are there any major complaints or red flags? 

• Do they have case studies showing successful implementations? 

Industry Certifications and Partnerships:  

• Microsoft Partner status 

• Intuit authorized QuickBooks hosting provider 

• Other software vendor partnerships 

• Industry association memberships 

Red Flags to Avoid When Selecting a Provider 

Not all hosting providers are created equal. Be on the lookout for red flags like vague security policies, poor customer support, hidden fees, or limited scalability. Spotting these early can save your firm from costly disruptions and headaches down the road. 

Major Red Flags: 

• No ISO or other security certification, or refuses to provide security documentation. 

• Unclear or confusing pricing with lots of hidden fees. 

• Poor customer support responsiveness during your evaluation. 

• No disaster recovery plan or vague answers about backups. 

• Outdated infrastructure or software versions. 

• No free trial or money-back guarantee.  

• No experience with your specific accounting software. 

• Recent security breaches and poor response. 

• No migration assistance offered. 

How to Choose the Right Accounting Software Hosting Provider—Step by Step

Follow this proven process to choose the right hosting provider: 

Step 1: Assess Your Current Needs (Week 1) 

Document Your Requirements: 

• How many users need access? 

• What accounting software do you use? 

• What other software needs to be integrated? 

• What are your security and compliance requirements? 

• What’s your budget for hosting services? 

Growth Planning: 

• How many users will you have in 2 years? 

• Are you planning to add locations or services? 

• What new software might you need? 

Step 2: Create Your Shortlist (Week 2) 

Research Process: 

1. Search for providers specializing in your accounting software. 

2. Check their websites for certifications and experience. 

3. Read reviews and ask for referrals. 

4. Contact 3-5 providers for initial information. 

5. Eliminate any that don’t meet your basic requirements. 

Initial Screening Questions: 

• Do you support X accounting software? 

• What security certifications do you have? 

• Can you provide references from similar firms? 

• What’s your typical implementation timeline? 

• Do you offer a free trial? 

Step 3: Evaluate and Compare (Week 3) 

Create a Comparison Matrix: Use the 8 criteria framework to score each provider on a scale of 1-10: 

• Security and Compliance 

• Infrastructure and Performance 

• Software Compatibility 

• Business Continuity 

• Support Quality 

• Pricing Structure 

• User Experience 

• Vendor Reputation 

Request Detailed Proposals: Ask each shortlisted provider for: 

• Detailed pricing breakdown 

• Technical specifications 

• Implementation timeline 

• Support procedures 

• Customer references 

• Security documentation 

Step 4: Test Before Committing (Week 4) 

Take Advantage of Free Trials: Most reputable providers offer free trials. Use this time to: 

• Test your actual accounting software and data. 

• Evaluate performance during your busiest work times. 

• Try the support system with real questions. 

• Have multiple team members test access from different locations. 

• Review all features and functionality you’ll need. 

Performance Testing Checklist: 

• Software loading speed 

• File upload and download speed 

• Multi-user performance 

• Mobile device access 

• Support responsiveness 

• Backup and recovery testing 

Step 5: Plan Your Migration (Week 5-6) 

Pre-Migration Planning: 

• Schedule migration during slower business periods 

• Plan staff training sessions 

• Prepare communication for clients if needed 

• Set up new user accounts and permissions 

• Test integrations with other business tools 

Implementation Support: A good provider should offer: 

• Free data migration services 

• Dedicated implementation specialist 

• Staff training sessions 

• Live customer support 

• Post-implementation check-ins 

Future-Proofing Your Choice 

Technology evolves rapidly, so it’s crucial to choose a hosting provider that can grow with your needs. Look for one that embraces emerging technologies like AI-powered data entry, automated report generation, intelligent document processing, and predictive analytics for client advisory services.  

Enhanced security features such as advanced threat detection, zero-trust security models, and stronger encryption methods are equally important. Improved collaboration tools—like real-time multi-user editing, advanced workflow management, client portals, and mobile capabilities—can significantly boost productivity.  

Your provider should also support scalability, making it easy to add or remove users, adjust pricing as you grow, manage multiple locations, and integrate new software tools. Contract flexibility matters too—seek options with month-to-month terms after the initial period, simple upgrade or downgrade paths, reasonable termination clauses, and data portability guarantees.  

Stay informed on industry trends, from new accounting software features to evolving compliance requirements and emerging security threats. Finally, conduct an annual review to assess performance, compare costs, explore new capabilities, and renegotiate contracts if it benefits your business.  

From Reliability to Security—Choose Hosting That Works as Hard as You Do 

Selecting the right hosting provider for your accounting software isn’t just another IT decision—it’s a strategic investment in your firm’s future.

According to IBM’s 2024 Cost of a Data Breach report, the average recovery cost has surged to $4.88 million, up from $4.45 million just a year prior.

With stakes this high—and rising each year—choosing the wrong provider can jeopardize not only your finances but also your reputation.   

Need Expert Help? 

If the technical details feel overwhelming or you want tailored advice for your firm’s unique needs, connect with a cloud hosting expert who understands the accounting industry.

Providers like Ace Cloud Hosting offer free consultations and a 7-day free trial for hosting your tax or accounting applications—helping you explore options, compare solutions, and make a confident, informed decision.