Are you someone who knows nothing about accounting, or are you an accounting apprentice? Either way, learning about the best accounting software for small business is a task in itself. There are many programs for small business accounting and even more cloud accounting programs for small business. But, when it comes to choosing the right program that can even do your taxes, you want to make sure you choose carefully after considering all factors.
Want to know more about best programs for small business accounting? Or accounting software for the small business? We’ve developed the ultimate guide for you. Because we are so sure that this ultimate guide will help you, we have made it free of charge. If you are using or looking for small business accounting software, then you have come to the right place. Before reading further, you might want to know what is small business accounting software and what is its use?
Xero
We love Xero for its robust features and low starting price. For just $12 a month, Xero lets you send custom invoices, reconcile bank transactions, capture receipts for easier record keeping, and track inventory.
But as a small-business accounting tool, Xero really stands out on the collaboration front. Unlike nearly every other accounting solution (including QuickBooks and FreshBooks), all of Xero’s accounting and inventory software plans include unlimited users. You don’t have to pay extra to delegate responsibilities like bank reconciliation or expense tracking to another team member: time-saving collaboration is built into your price.
However, Xero’s $12 a month plan limits you to entering only five bills and sending only 20 invoices a month. You can send unlimited invoices and quotes with only the Growing and Established plans, which start at $34 and $65 a month, respectively. Plus, you can only track expenses with the priciest plan—both QuickBooks and FreshBooks offer small-business expense tracking up front.
FreshBooks
FreshBooks’s combination of stellar features, customizable invoices, and well-reviewed mobile apps make it pretty much perfect—especially for freelancers. Unlike Xero, FreshBooks lets you send an unlimited number of invoices and estimates with every plan. Each plan also includes time tracking for easier, more accurate client billing. FreshBooks’s built-in small-business expense tracking helps you maintain a balanced budget. And, like QuickBooks Online, FreshBooks includes built-in mileage tracking—a must for freelancers who plan to claim mileage expenses on their year-end tax forms.
FreshBooks discounts
FreshBooks starts at $15 a month, but the company’s frequent discounts make its financial software even more affordable. As of December 2021, FreshBooks is offering new customers 70% off for three months—which knocks your starting price to $4.50 a month. Plus, paying annually takes 10% off your monthly price. (If you sign up for a new annual subscription during this current promo, you’ll lock in 80% off for the first three months.)
But while FreshBooks doesn’t limit your invoices, it does limit the number of customers you can bill each month. You can send your customers an unlimited amount of invoices, but the cheapest plan limits that client number to just five. Additionally, FreshBooks doesn’t include bank reconciliation with its cheapest plan. Since bank reconciliation is an absolutely foundational accounting task, we can only recommend FreshBooks’s cheapest plan to freelancers or brand-new startups with just a few transactions a month
Intuit QuickBooks Online
Pricing: Starts at $12.50/month
Intuit Quickbooks might be the first resource that comes to mind when you hear the term, “small business accounting software” — and for good reason. Beyond its first-rate suite of capabilities, the program sets itself apart with elements like receipt capture and 24/7 chat support.
It also features integrations with PayPal, Shopify, and Square. Taken together, those components — among several others — make Quickbooks a crowd-pleasing small business accounting software.
All plans allow you to track income and expenses, send invoices and receive payments, run reports, send estimates, track sales and taxes, and capture and organize receipts. More advanced plans allow you to track inventory, track time, and even run full-service payroll.
Best for Businesses Looking for a Tried-and-True Option
Intuit Quickbooks is one of the most (if not the most) prominent accounting software for small businesses. It’s been around long enough for you to have a solid idea of what you’re getting when you invest in it — an accessible, affordable, time-tested solution that can suit a company of virtually any size. If you’re looking for a safe choice that reconciles reliability with exceptional functionality, consider looking into Intuit Quickbooks.
Pabbly
Pricing: Starts at $9/month
Pabbly Subscription Billing is a recurring and subscription management software for small to medium-sized businesses. This software provides real-time actionable metrics on your monthly payments, revenue, net revenue, active customers, and new subscriptions. It also automates all your business workflows, customer communication, and invoice creation so you can focus on your business growth.
Best for Businesses Looking for a Reliably Fixed Pricing Model
One of Pabbly’s key selling points is its subscription billing model. It’s one of the only software on this list that doesn’t charge any extra fees on the basis of per-transaction and monthly revenue generation. That kind of consistency — paired with it’s first-rate functionality — make Pabbly a solid option.
Zoho Books
Zoho Books assists you with everything from daily transactions to negotiating deals and invoicing.
Like all Zoho tools, you get a simple platform that you can customize to fit your needs. There’s not a huge learning curve, despite the fact you can do a lot.
The small business software ensures tax compliance as well. You’ll easily understand your tax liability. You’ll also be able to prepare for audits in accordance with IRS guidelines.
I like the Zoho Books dashboard because it’s straightforward and easy to use. This is true whether you are on a desktop or your mobile phone.
Navigate through the most common accounting needs like:
- Inventory
- Banking
- Reports
- Receivables
- Payables
Zoho Books integrates with 40+ apps right out of the box. Similar to FreshBooks, the number of apps is a bit low compared to the competition; but the essentials are available.
In addition to the features, pricing for Zoho Books is based on the number of contacts on your account. Contacts are defined as customers and vendors who you can create transactions for in your books.
Here’s a brief overview of the three pricing plans:
Basic — $9 per month
- Up to 50 contacts
- 2 users
- 5 automatic workflows
Standard — $19 per month
- Up to 500 contacts
- 3 users
- 10 automated workflows
Professional — $29 per month
- 500+ contacts
- 10 users
- 10 automated workflows
All plans come with bank reconciliation, expense tracking, customer invoicing, recurring transactions, sales approval, and timesheets.
The Basic plan is good — especially if you’re a smaller business. Other beginner plans that I’ve seen in this guide start as low as five contacts.
Overall, the Standard plan is the best value. In addition to the larger contacts list, it also comes with billing, vendor credits, purchase approvals, reporting tags, budgeting features, and Twilio integration.
It’s easily scalable though. That means if your business grows, the software grows with you.
You can add users to any plan for an additional $2 per month or $20 per year.
Zoho Books has a 14-day free trial available for all plans. They offer month-to-month billing at the prices listed above, or annual contracts with two months free.
Sage 50cloud
For nearly four decades, the Sage brand has been providing enterprise-grade accounting solutions to companies across the globe. Sage 50cloud is an ideal solution for both small and medium-sized businesses.
The software is robust and sophisticated. It’s desktop software with remote access from anywhere.
Sage 50cloud has inventory management, accounts receivable functionality, report generation, and integrated payroll features. It’s great for small businesses that need multi-user access.
The security capabilities allow you to restrict access or limit functions to users in your company based on their clearance level or task description.
Sage has been around for a while, and it shows (not always in the best way). The user interface looks dated compared to other solutions on the market today. It doesn’t have any features for time tracking and lots of links open new windows, which isn’t very user-friendly.
Pricing for Sage 50cloud is a bit higher compared to other options on my list:
- Pro Accounting — $50.58 per month
- Premium Accounting — $78.21 per month
- Quantum Accounting — $197.55 per month
Prices will increase based on the number of users you add. You can also include Microsoft Office 365 for an additional $150 per year.
These price points aren’t as appealing for entrepreneurs, sole proprietors, and startups. I’d only consider Sage 50cloud as a medium-sized business that needs the resources and assistance of a company like Sage.
I’d also recommend an annual contract to save some money on the already high prices.
Wave
Wave is a free accounting solution for entrepreneurs. That’s right—free. There are no set up fees, hidden costs, or monthly charges.
Here’s a list of everything you get for free using Wave:
- Income and expense tracking
- Bank and credit card connections
- Unlimited guest collaborators
- Invoicing in any currency
- Send estimates and turn them into invoices once approved
- Receipt scanning
- Automatic receipt recording
Use the Wave mobile app to manage everything you need on the go. You can even capture receipts when you’re offline, and they’ll upload when you connect.
You can manage multiple businesses with one Wave account, which is perfect for any entrepreneur. Personalize your invoices with customizable and professional templates as well.
The usability, features, and mobile app rival some of the best paid accounting solutions on the market today. The fact that you can use Wave for free is incredible.
You’ll only have to pay if you enable online payments or payroll with Wave.
Online payments are billed per use, at industry-competitive rates. ACH transfers are 1% per transaction with a $1 minimum fee. Credit card processing is 2.9% plus $0.30 per transaction.
Payroll starts at $20 or $30 per month, depending on your state. You’ll also be charged an additional $4 per active employee and $4 per contractor paid.
Overall, Wave is perfect for entrepreneurs looking for a basic accounting solution. It’s pretty limited outside of the standard features. Both the app and payroll integrations aren’t as useful as other solutions on my list.
Conclusion:
Know where you stand with your finances with our list of the best programs for small business accounting. Whether you’re just starting out or you’ve grown beyond a two-person shop, it’s important to understand what options exist and how they can help. This roundup covers the spectrum of accounting software, whether you’re running a home-based business or a thriving enterprise with multiple locations and hundreds of employees.