9 Min. Read

5 Best Small Business Accounting Software

Jan 22, 2024

Accounting software can be a huge benefit for small business owners. It can help make it easier for them to keep track of their accounts receivable and payable. As well as understand their profitability, and be ready for tax season.

Small businesses can use accounting software straight out of the box. This is without requiring major customizations. A customised enterprise resource planning (ERP) system is often required as a corporation grows. And as its accounting requirements become more sophisticated.

Numerous accounting software choices with varying capabilities and prices are available to small firms. In general, the industry type and the amount of staff are two factors that could help a small business owner choose the best accounting software.

Read on as we take a look at our opinion on the 5 best small business accounting software currently available to you on the market.

Table of Contents

FreshBooks (Best Overall)

Frequently Asked Questions

FreshBooks (Best Overall)

Overview of FreshBooks

FreshBooks began as an invoicing programme when it was founded in Toronto in 2003. FreshBooks today has over 30 million users and has added more features over time. There are four distinct programmes, and companies can save 10% by paying annually as opposed to monthly. Furthermore, FreshBooks frequently provides discounts for the first several months of membership.

There are numerous connectors for third-party apps, including Gusto, G Suite, and others. The ability to customise and personalise invoices for a business-like appearance and feel is one of FreshBooks’ distinctive features. FreshBooks is a fantastic resource for creating project budgets. As well as distributing estimates and proposals, and collecting client payments.

Why FreshBooks?

Invoicing is one of the most important accounting requirements for the majority of service-based firms. Comparatively speaking, FreshBooks provides more invoicing customizations than comparable accounting software.

Its primary function is to send, receive, print, and settle bills. But it can also handle the fundamental bookkeeping requirements of a company. It is simpler for service-based firms to issue bids, track time on projects, and accept payments thanks to this accounting software.

The Advantages of FreshBooks

It is cloud-based
It’s range of pricing plans means it is suitable for any budget
It’s interface is user-friendly
Integration of third-party apps
It gives you access to advanced invoicing features

The Disadvantages of FreshBooks

The only downside of FreshBooks is that the mobile app has some limitations.

FreshBooks Pricing

The four FreshBooks plans are as follows:

Lite, which costs $15 per month, Plus, which costs $25 per month, Premium, which costs $50 per month, and Select, which is a special service with special pricing. Without any discounts, these are the standard costs.

QuickBooks

Overview of QuickBooks

One of the most popular accounting programmes used by small businesses and their bookkeeping and tax specialists is Intuit’s QuickBooks. The cloud-based software can be accessed through a web browser or a mobile app.

One of the advantages of using QuickBooks is that QuickBooks Payroll fully connects with QuickBooks Online. This makes it a strong option for companies also searching for a payroll solution.

Integration with third-party applications like Stripe or PayPal is possible with all plans. The QuickBooks AppStore organises all of their apps by function. And offers useful illustrations of each product’s advantages.

Why QuickBooks?

For small enterprises, QuickBooks is a well-regarded accounting programme. In addition to the fact that many small business accounting specialists utilise QuickBooks, there are also several online training materials. As well as forums where users can get assistance when needed.

One central dashboard provides easy access to all accounting elements. Therefore facilitating more fluid and effective bookkeeping.

The Advantages of QuickBooks

It scales as your company grows
It is cloud-based
It has a fully functional mobile application
It’s a common choice for accounting professionals
It has full integration with a number of third-party apps

The Disadvantages of QuickBooks

In order to have more users, you are required to upgrade your plan
There are often synching problems with credit cards and banks

QuickBooks Pricing

Simple Start is $25 per month, Essentials $50 per month, Plus $80 per month, and Advanced $180 per month. These four membership tiers are available after the 30-day free trial. For the first several months, a sizable reduction is typically provided. And some accountants are also able to provide small businesses with wholesale prices.

The software’s monthly subscription can be increased as a company expands. And the mobile app’s numerous customization possibilities can be used to accept payments. As well as check reports, scan receipts, and track business mileage.

Sage

Overview of Sage

Sage 50cloud Accounting is a sizable desktop-based accounting programme for small businesses. It’s one of the most feature-rich, adaptable accounting programmes available.

Apart from its wide range of features, what distinguishes it is its interaction with Microsoft 365. This strong and cutting-edge connection helps to compensate for the fact that Sage 50cloud Accounting must be installed on a local PC. This is in order to enjoy all of its functions. Despite the fact that some of its data is accessible online.

When compared to alternative accounting solutions, which allow customers to access them from any device with an internet connection, Sage 50cloud Accounting is at a disadvantage. This is because it is only available for Windows computers.

Why Sage?

Sage 50cloud Accounting is a capable accounting programme for small businesses. It has a wide range of financial tools and flexible customization possibilities. It is a hybrid solution since it is integrated with Microsoft 365: local software that runs on a hard drive and can transfer data to cloud-based productivity programmes.

The Advantages of Sage

Very sophisticated set of features
Impressive support options
High customizability
Good item and contact records
Wide range of inventory management tools

The Disadvantages of Sage

It is only available on windows
Their UI is slightly outdated
It doesn’t have a comprehensive mobile application

Sage Pricing

There are three different plans in the Sage 50cloud Accounting services range. Pro Accounting has a one-person monthly minimum of $56.08. For a single user, Premium Accounting starts at $87.58 per month, while Quantum Accounting starts at $1,460 per year.

Xero

Overview of Xero

Founded in New Zealand in 2006, Xero today has more than 3 million subscribers globally. In Australia, the UK, and New Zealand, this accounting programme is well-liked. Over 4,000 people work for Xero, and the company is expanding quickly here as well.

Unlimited invoices and bills are available for both the Growing and Established programmes. The Established plan contains extra capabilities including multi-currency, spending management, and project costing, which is the only distinction between the two. Hubdoc, a bill and receipt capture tool, is available with all three levels.

Why Xero?

For small businesses searching for really straightforward accounting software, Xero is a good option. This software fully interacts with a third-party payroll service and offers a simple user interface. Customers may make payments to businesses online thanks to Xero’s connection with Stripe and GoCardless.

The Advantages of Xero

It is cloud-based
There is a mobile app
Gives you access to a third-party app marketplace
It has payroll integration with Gusto
There is a simple inventory management system

The Disadvantages of Xero

There are limited reporting features
Their customer service is limited
They charge a fee for any ACH payments

Xero Pricing

Three monthly membership plans from Xero are available, together with a full-service payroll add-on: At first, it cost $12 per month, then it grew to $34 and finally, it cost $65 per month. Gusto provides the full-service payroll option, which costs an additional $39 per month + $6 for each employee. The business provides a 30-day risk-free trial.

Wave

Overview of Wave

The Toronto-based company Wave was established in 2010. The business, which employs more than 250 people, was acquired by H&R Block in 2019. This free package contains all of the essential accounting features that the great majority of small businesses use, including income and cost tracking, financial analysis, invoicing, and receipt scanning. You can access these features online or through the mobile app.

Payroll and customer payment processing are premium services that have an additional cost; nonetheless, all bookkeeping, invoicing, and reporting functions are offered without charge.

Why Wave?

For a service-based small firm that only has to send straightforward invoices and doesn’t need to handle payroll, Wave is the perfect accounting software platform. Wave is one of the best free software in our assessment. Additionally, it will meet all of the accounting needs of several independent contractors and service-based businesses.

Accountants can get the Wave reports they require at year’s end to create a company’s tax return.

The Advantages of Wave

It is a free service for accounting, receipt scanning, and invoicing
It has a mobile app
It allows an unlimited amount of users
There are no billing or transaction limits
You can run a number of businesses from one account

The Disadvantages of Wave

You can only integrate third-party apps through Zapier
There are higher fees for ACH and credit card payments

Wave Pricing

The payment gateway is how Wave generates revenue. Wave charges 2.9% plus $0.60 per transaction for Visa, Mastercard, and Discover and 3.4% plus $0.60 per transaction for American Express to process a customer’s payment. These costs are marginally more than those for other accounting software. In addition, Wave charges 1% per transaction with a $1 minimum cost to execute an ACH payment as opposed to a credit card transaction.

Key Takeaways

Accounting software is a vital component of running a small business. You are able to streamline your accounting processes and save a large amount of time through automation.

When it comes to the best choice, it is all down to personal preference and what software suits your business needs.

FreshBooks, in our opinion, is the top accounting programme for proprietors of small businesses. With a wide range of easy-to-use features and invoicing capabilities, it offers everything you need to properly manage your business bank accounts and keep a healthy cash flow.

Additionally, it tracks your other business expenses as well as your income and expenses. Also, the range of pricing plans means that there’s a choice suitable for you – no matter your budget.

FAQs on Small Business Accounting Software

What Is the Easiest Accounting Software for Small Business?

One of the simplest accounting programmes to use is FreshBooks. Small business owners without accounting expertise can use the software.

What Is the Best Small Business Accounting Software for Mac?

A number of popular accounting software works on a Mac, this includes FreshBooks, QuickBooks and Zoho Books.

Is There a Better Accounting Software Than Quickbooks?

Yes, for small businesses and self-employed people, FreshBooks can be a better option.