QuickBooks vs FreshBooks vs. Xero: A Comparative Guide from a Business Owners Perspective by back office accountants Dec, 2023

When setting up a FreshBooks account, you can start fresh, or transfer over existing data from any previous accounting software solutions like Xero, QuickBooks Online, Zoho Books, or Invoice2Go. If you’re not a fan of manual entry, Clients, Expenses, and Items can be imported by you with the steps below. For Taxes, you can email our excellent customer support the details below and we’ll take care of it for you. Xero has some of the worst customer service we have ever experienced, particularly for a company of their size. Combine this with terrible user experience in some parts of the app, unintuitive subscription models, and bad resources online, and it takes about 20x longer than it should to get anything done. The entire premise of Xero is cloud-based accounting, but it feels like traveling back in time 25 years when trying to get anything done with them.

  • Now, thanks to companies like QuickBooks Online and Xero, we design accounting workflows that fulfill the needs of any business.
  • Xero’s design is great, but as soon as you hover over your submenus for the first time it’s easy to get lost and have no clue where to start.
  • While QuickBooks has many different accounting products, QuickBooks Online is most comparable to FreshBooks.
  • When choosing software vendors you need to prioritize the one that fits your business needs.
  • If you find someone who is a good fit for your business needs, it doesn’t matter if they are in California while you work from New York.

No matter how tedious it might seem it’s vital to know what money is coming in, where it’s being spent, and whether you’re earning a net profit come the end of the financial year. If Xero doesn’t provide an integration from a service you use, you can hire a developer to create it for you. Xero’s documentation is public and robust to help developers link other products.

Xero has more (and better) accounting features for established businesses

This bookkeeping software is easy to use, fairly priced, and efficient for most services and features. It also offers a great support system with live bookkeeping assistance. Unlike both FreshBooks and QuickBooks Online (and, frankly, nearly every other accounting tool), Xero includes inventory management with each plan.

The key features that all accounting software offers are bank and credit card transaction syncing, transaction classification, and basic profit and loss statements. Paid add-ons include payroll services, more comprehensive financial reporting, bill pay in addition to bill tracking, and invoice payment options. Xero accounting software is a cloud-based system that helps small businesses manage their finances. The software offers a variety of features, including invoicing, tracking expenses and creating financial reports. Xero also integrates with other business applications, such as payroll and inventory management systems. Zoho Books offers a forever free plan of its accounting and invoicing software, which sets it apart from competitors, in addition to five paid plans that start at $15 per month.

  • Xero is freelancer friendly because of its lower cost and simplicity.
  • It’s Xero vs QuickBooks vs Freshbooks, with no stone left unturned.
  • QuickBooks offers specialized tutorials to help users make the changes that work for them.
  • Alternatively, QuickBooks includes accountant access in all plans.
  • Some features are not as advanced as Xero, but Quickbooks provides high quality tools that are quick, user-friendly, and expansive as needed.
  • It’s feature-light and user-friendly design make it appealing for those who simply want a basic accounting software.

FreshBooks can be a good option for freelancers and contractors looking for an affordable, simple accounting software. There’s time tracking in all plans and phone support is available from 8 a.m. The first two plan tiers put a limit on billable clients, but not on invoices. FreshBooks cloud based accounting software is built for non-accountants running small and medium sized businesses – making it easy to create invoices and get paid. And you can always give your accountant immediate access to FreshBooks to get support during tax season and key financial decisions.

Xero vs QuickBooks vs FreshBooks: The Best Accounting Software (with Monty Python)

Therefore, without a bank feed, you can’t designate which accounts to subtract expenses, making FreshBooks unusable if you have more than one bank account and no live feed established. The choice between FreshBooks and QuickBooks comes down to what features you need and how much you’re willing to pay. If you need a comprehensive accounting solution, then QuickBooks is the better option. However, if your top priority is ease of use, FreshBooks is the better choice as it’s far more beginner-friendly.

In need of professional bookkeeping services?

The Plus plan (the most popular) allows for billing up to 50 clients, while the Premium plan removes that limit. You can customize these reports to show data for a specific period. As far as ease of use is concerned, Xero wants to convert QuickBooks users to their platform. However, they have varied approaches that can make a big difference in how well they work for your company. Customize the reports you see by using your business’s key performance indicators and metrics, so you can easily see where your business is doing good and which the areas of improvement are.

Best Free Accounting Software for Small Businesses

Due to its limited accounting features compared to Xero, FreshBooks doesn’t offer as many report options, and within its reports, customization is pretty sparse. For example, when you purchase the Pro Plus Desktop plan, you can have up to three concurrent users but each of those users must pay for their own account (at $349.99 each per year). Its Online version allows up to 25 users at no additional cost, provided you’re paying for the Advanced plan. ET from Monday to Friday; offers email support, but not live chat support with a human. Can support larger small businesses with dozens of employees; all three plans include an unlimited number of users.

All of Xero’s plans come with inventory management so business owners can track what’s in stock and which products are selling. Keep in mind that the ability to use multiple currencies in the software income tax calculator and invoice is limited to the company’s highest tier, at $70 per month. If using multiple currencies is a priority to you, consider other platforms that offer this capability at a lower cost.

So, what happens to the freelancer who simply wants to make professional invoices? Well, you can pay for upgraded plans on Xero to have access to more features even if you don’t have employees. But they also need a linked bank account for paying these expenses. Why would you choose FreshBooks over any other accounting software? The helpful features can be a life- and time-saver for anyone who doesn’t have an entire department to take care of such things. For example, you can connect your customer relationship management (CRM) system with your accounting software.


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