If you own an independent contracting business, chances are the accounting part is a big part of your day-to-day operations. My intention in writing a blog post on a specific topic is to help you find a set of software that works well for independent contractors. I’ve compiled a list of the best accounting apps for independent contractors. With over 20 options for small businesses and freelancers, this post should provide you with the information you need to make a great purchasing decision.
Lookijg for the best independent contractor software out there? here are the best!
Sage 100 Contractor
Best overall accounting software for construction companies.
Sage 100 Contractor is an ideal package for small contractors. This feature-rich, on-premises application provides the tools any construction firm requires to ensure a company completes projects profitably. The cost of Sage 100 Contractor is very reasonable, making profitability significantly more likely.
Key functionality:
For a small construction company, successfully estimating project cost is vital to the bottom line. Sage 100 Contractor is ideal as it can rapidly generate accurate bids for any size project. The estimating function provides various templates, formulas, and variables to expedite the estimate process needed to bid on projects rapidly. Furthermore, as a Microsoft Windows-based application, Windows functionality—such as cut and paste and Excel compatibility—greatly expand Sage 100 Contractor’s ease of use.
A valuable function for contractors to ensure a profit is the application’s import feature, which allows the construction company to import information from local suppliers, including updated lists of available materials and costs. If local suppliers do not provide import information, Sage 100 Contractor provides an updated list of prices from the Trade Service Corporation.
Sage 100 Contractor includes a robust general ledger feature ensuring additional accounting software is not needed to track project costs. The general ledger function provides the accounting insight a small company requires to track payroll, accounts receivable, and accounts payable. The application comes with a variety of standard reports and allows the creation of custom financial reports and a check reconciliation option to compare bank statements to current balances.
One of the most challenging aspects of running a small construction business is juggling an always shifting schedule. However, scheduling supplies, locations, and subcontractors is significantly less stressful using Sage 100 Contractor’s scheduling function. The schedule function is easily managed through a graphic user interface (GUI), which means moving tasks, dates, and inventory is simple. Additionally, Sage maintains the original schedule as well for reference.
Access & users:
Although Sage provides a cloud-based Field Operations component at an extra cost, the current offering is an on-premises Windows application. The Admin user can manage security in the Sage 100 Contractor application. The administrator can create Security User Groups based on user or employee position. Each group can have specific permissions based on a user’s job function, such as saving, deleting voided, or even printing checks. The admin console allows for granular permissions to be applied, but Sage documentation suggests caution when setting permission to avoid locking users out of the application.
Ease of use:
Ease of use is a primary goal of Sage 100 Contractor as small business owners do not have an abundance of free time to master a complicated software package. The application is a menu-driven application allowing a user to easily navigate, especially if the user has had only rudimentary computer experience. For users who need a little extra help getting started, Sage offers comprehensive and detailed documentation and a variety of webinars and videos on how to perform many of the Sage 100 Contractor functions. Sage also provides in-person training at a cost for larger companies and online support to assist if needed.
Cost:
Although Sage 100 Contractor does not offer a free trial period, a guided demo is available on the Sage website. If the demo meets a company’s needs, Sage 100 Contractor’s pricing is extremely reasonable, making the investment significantly less stressful than for other software. Sage 100 Contractor uses a subscription service. An initial subscription fee is required, and then there is a low monthly fee per user. The per-user fee means access to all the functionality at a minimal cost for small companies with few users. Thus, Sage is a financially feasible application to maintain as a company grows.
Things we liked:
- Low monthly cost ideal for contractors and small businesses
- Easy to use GUI and menu-driven functionality
- Ability to import local supplier price-lists
- Job estimating and general ledger functions
- Powerful project scheduling capabilities
Things we didn’t like:
- Rapidly growing companies may outgrow the software quickly
- Report templates may not cover all needs
- Costs increase as users added
Penta Construction Management Software
Websitewww.penta.com
Best accounting software for large contractors or construction companies.
PENTA Construction Management Software’s scope and cost suggest it is a package best used by construction firms performing multiple large-scale projects. Using the on-premises version of PENTA also requires an Oracle database, a factor any company needs to consider when considering budget allocation for PENTA implementation.
Key functionality:
PENTA’s financials package includes all of the features any construction company would need, including general ledger, accounts payable and receivable, inventory, and payroll. Plus, PENTA allows multi-entity accounting with a hierarchical consolidation feature, which is essential for managing large projects across several organizational units.
Large firms managing massive projects will find the Financial Management, Project Management, and Time and Billing features of the PENTA package invaluable. The PENTA Financial Management module provides elaborate financial reports based on a distinctive Organizational Unit Structure. The Organizational Unit Structure integrated into PENTA is key to the financial management of multiple large-scale jobs.
PENTA modules integrate seamlessly, allowing financial information to be easily imported or exported into the Project Management module. Using this integration, a Project Manager can track job cost accounting on multiple projects, deftly handle materials management, materials purchasing, and accounts payable for each discrete project with the Project Management module.
Accurately tracking time and billing can be a monumental task for any large organization. Still, the PENTA Time and Billing module is a powerful tool to ensure each project is making proper use of all staff hours. The module can provide payroll reports allowing rapid and detailed information categorized by job. The Time and Billing module is one of the most powerful modules in the application; it helps ensure all projects are meeting financial goals for profitability—despite the size or complexity.
Access & users:
Users with administrative rights can securely manage user access and permissions in the administrator portal for PENTA. An administrator can assign individual user access rights globally in the application based on a specific project or job function. Construction companies deciding to implement PENTA on-premises must maintain significant data and application security in the data center. Companies wishing to be relieved of onsite data security can opt to implement a hosted, cloud-based PENTA solution.
Ease of use:
Whether a company deploys PENTA on-premises in the company data center or opts for the cloud-based solution, users will find the application robust, and it may seem daunting to use initially. However, customers familiar with the construction industry’s processes and challenges will soon find PENTA intuitive to use. PENTA offers detailed documentation, paid in-person training, live online training, and a variety of webinars meant to assist the PENTA customer with the information required to make full use of the many modules included in the application.
Cost:
PENTA is a full-featured application with modules created to manage multiple large projects. A company considering PENTA implementation can expect the costs to be substantial. PENTA implementation on-premises will require robust hardware to run the application and for data storage. Customers opting for the cloud-based solution can expect a cost for a variety of things such as data storage and transfer and a monthly fee.
Things we liked:
- Modules allow for full project management from bid to completion
- Data integration between modules means less repetitive data entry
- Financial modules provide complete insight on project profitability
- Built-in reports for almost any facet of a project
- Support is consistently rated high for customer satisfaction
Things we didn’t like:
- Expensive to implement and maintain
- Proper management of the platform requires trained staff
- May be too feature-rich for some companies
Quickbooks
Intuit’s Quickbooks is the best-known accounting app for good reason. While it’s not perfect, it is the best accounting program on the market today and sets a high bar for what business money management apps can do. Quickbooks is great for a wide range of businesses from solo freelancers to brick-and-mortar empires.
This program is the standard for small business accounting, and it offers much more than an independent contractor probably needs. But, that said, it also includes everything an independent contractor may ever need. That includes live bank connections, invoicing, payment processing, and mobile apps.
Quickbooks has versions for both Windows and Mac, as well as an online version (which is best for independent contractors). There is both a self-employed version and full version that should both sufficiently handle your business needs. Quickbooks Self-Employed plans start at $7.50 per month and go up to $17 for the Live Tax Bundle which includes live assistance from CPAs.
RUNNER-UP, BEST OVERALLXero
Xero is a top competitor to Quickbooks and offers a wide range of features starting at $11 per month for the Starter version, going up to $62 per month for the Premium version. The Starter version should be sufficient for most freelancers, through any payroll needs require the $32 Standard version.
All Xero plans include financial reports, mobile apps, more than 1,000 integrations, live bank account connections, invoicing, and access for multiple team members. Xero customers also get free access to the Xero Projects app, which is an accounting project management app, for no extra charge at this time. This is perfect for hourly and project-based billing.
You will still need an external tax app or accountant, but all of your bookkeeping needs are covered. Billing and expense forms, double-entry accounting, inventory tracking, document management, and CRM integrations are just a few features that make Xero worth serious consideration for any independent contractor.
BEST FREEWave Accounting
Wave Accounting is a free accounting app that works both online and on your smartphone. While there are charges for some extra features like payment processing and payroll, the free starting price point makes it a winner for many independent contractors.
The free version is pretty impressive, even compared to some paid accounting apps. It includes invoicing, live bank connections, income and expense tracking, and collaborators. It even has the ability to track multiple businesses (like a “side hustle” or two) and personal finances in the same account.
Paid add-on services include online ACH and credit card processing and payroll. But these cost more than some competitors, so if you process a lot of payments you may end up paying more with Wave’s “free” accounting than you would with a paid app.
BEST FOR FREELANCERSFreshbooks
If you are a freelancer and want simple accounting with a focus on your needs, Freshbooks is a leading choice. This app is ideal for the self-employed and starts at $6 per month after a 30-day trial. If you have more than five clients, you’ll need the Plus version at $15 per month or the Premium version for unlimited clients. Save 10% by paying annually instead of monthly. Additional team members cost $10 per month each.
Features include invoicing, expenses, time tracking, projects, estimates, payments, reporting, and a mobile app. It is one of the easiest accounting systems to use. While some other advanced programs feel like they require an accounting degree to navigate, Freshbooks keeps it simple.
BEST FOR PART-TIME CONTRACTORS AND SIDE HUSTLESZoho Books
Zoho offers a suite of email, CRM, a custom app engine, and an accounting package. The accounting side, Zoho Books, is free in the basic version, which should be plenty for most independent contractors.
Zoho Books includes accounting needs like bank reconciliations, invoicing, expense tracking, timesheets, projects, recurring transactions, and sales approvals. Bill management requires upgrading to the Standard version at $15 per month or $180 per year.
Zoho Books does quite a bit, but does not scale up for larger businesses like some of the more popular accounting packages. It should work fine for independent contractors and side hustlers alike.
BEST FULL-SERVICE APPBench
Bench is an accountant and an accounting app in one offering two packages. The Essential package, which focuses on bookkeeping, costs $299 per month (or $249/month if billed annually). The Premium plan includes everything from the Essential plan as well as tax advisory and tax filing services for $499 per month. (or $399/month if billed annually). While it costs more than most others on this list, it includes one big feature the others don’t: a human accountant.
Included in the monthly fee is a team of bookkeepers to monitor your connected financial accounts and keep the books up to date. Whenever you want, you can log in and view statements and reports that you need to run your business.
You’ll get monthly financial reports and can rest easy knowing the books are taken care of. Bench doesn’t include accounting, but it does provide the reports and support you need for your accountant to take care of things come tax day.
Bench offers a free trial for both of its plans so you can give them a try before committing.
Knowify
Website www.knowify.com
Best cloud-based accounting software for small to midsize contractors or companies.
Knowify is also a cloud-based option, making it an excellent choice for a small to midsize contractor or company needing access to the project or financial data on the go or the job site. While not a perfect fit for every company, it’s an excellent option for finance or project management staff to access data on any platform—from laptop to Android device.
Key functionality:
Because Knowify is cloud-based, it is an excellent fit for always on-the-go contractors in the construction, electrical, plumbing, and landscape trades. Knowify provides web-based estimation and bid generation tools as well as contract management, accounting, and invoicing. Using a laptop or tablet, contractors can easily track time, work orders, staff scheduling, or subcontractors without the overhead of a server-based application.
One of the key drawbacks of Knowify is that it isn’t a full-fledged double-entry accounting system; however, it is fully integrated with QuickBooks Online, making it a good choice for many smaller construction companies that have the flexibility to work with an accounting or bookkeeping partner.
Access & users:
Knowify offers a browser-based Administrator console for easy application management. The administrator can create users or groups and apply permissions as necessary. Knowify is also a secure solution, which means construction companies that choose it can trust that their personnel and financial data will be protected.
Ease of use:
Knowify provides an intuitive, easy to use browser-based interface. Customers familiar with Chrome, Firefox, or Microsoft Edge will have little trouble moving between functions. All the benefits of Knowify are available to any customer with access to a Wi-Fi or cellular network, allowing for easy onsite estimate generation. Phone and email support are available during business hours. Knowify also offers detailed documentation, video training, and webinars.
Cost:
Knowify offers a low-cost monthly subscription making it an attractive cloud-based option for individual contractors and small businesses. A slightly more expensive monthly subscription offering is available for “Enterprise” customers needing enhanced functions for approximately $100USD per month.
Things we liked:
- Multiple financial functions from job estimating to invoicing
- Inexpensive
- Intuitive interface
- Portal access available on any device with an Internet connection
- On-site estimating capabilities
Conclusion
You may be an independent contractor or gig worker. This means you are running your own business, but are still working for someone else. If you are self-employed, then your probably want to get organized so that you can be more efficient on your own time. You also want to take care of the right taxes so you don’t have any nasty surprises at tax season. But what if you are both a contractor and an employee? There are certain things all individuals should do to ensure they are being treated fairly while also making sure that they are getting all of their expenses covered.