Wave accounting is aimed at smaller businesses, Wave can handle cash and accrual companies, as well as limited stock control. It is also accessible from anywhere with an internet connection. Wave can be used to track sales tax and VAT, record debts, imports and stock control .
Wave accounting is the most advanced small business accounting software. Wave accounting comes with complete and seamless integration with credit card processing services. Wave Accounting gives you a powerful combination of advanced features, superb usability, and top notch support at an affordable price to help you take the pain out of accounting for your business. , Wave Accounting’s simple and intuitive interface reduces the time it takes for your bookkeepers to do their work, freeing them up to work on more important tasks than data entry or report generation.
Wave Accounting is an ideal choice for small-business owners looking for free software. This financial management platform is user-friendly and approachable — especially for those with no prior accounting experience — yet fully functional. It allows you to manage bookkeeping, accounting and invoicing in one place.
Although Wave’s invoicing capabilities make it a particularly appealing option for service-based businesses, this small-business accounting software does have its limitations. It doesn’t have the option to upgrade to a higher-tier plan with additional features, making it ill-suited for larger and fast-growing businesses.
| Pros | Cons |
| Free.User-friendly.Unlimited income and expense tracking.Unlimited invoicing with customizable templates and payment terms; dedicated invoicing mobile app.Unlimited users with varying user permissions.Double-entry accounting. | No additional plans to increase functionality (e.g., time tracking, inventory management).No phone support; live chat support only available for paid services (Wave Payments and Payroll). |
Deciding factors
| Price | Free. The free Wave software includes accounting, invoicing and receipt scanning. |
| Maximum number of users | Unlimited. |
| Maximum number of financial accounts | Unlimited. |
| Ease of sharing with accountants | Good. You can invite your accountant to Wave via email and designate their user role. Wave recommends “editor” permissions for bookkeepers and accountants, which gives full access to purchases, accounting and reports, as well as limited access to sales.Wave offers personalized bookkeeping, accounting, payroll and tax assistance through its Wave Advisors service. |
| Scalability | Poor. Although Wave offers add-on products — e.g., Wave Payroll, Wave Money — that can be useful for businesses that want to bundle financial services, it does not provide more advanced accounting plan options outside of its free software. |
| Ease of use | Excellent. Wave is easy to use, even without prior accounting knowledge. The software has a clean design and intuitive user interface. Plus, the Wave Help Center offers a range of resources to help you get started and answer common questions you may have. |
How does Wave Accounting work?
Getting started
You can sign up for Wave quickly and easily online. After providing a few basic details about your business — name, type, currency you use, address — you’ll have instant access to your free account.
Connecting your accounts
Once logged in, your main dashboard will show your cash flow, profit and loss, invoices, bills and other financial insights. From the dashboard (or the Banking menu on the left-hand side), you’ll be able to connect your bank and credit card accounts to automatically download and categorize your transactions.
When you reconcile your books, you’ll navigate to the “Reconciliation” tab within the Accounting menu. If you need to manually edit, add or remove any transactions, you can do so in the “Transactions” tab. Next, you can add sales tax (if necessary), create customer profiles and customize your invoice templates. Back to top
Costs and features
Wave’s free accounting software has no contract and no hidden charges.
Although accounting and invoicing are separated into two different product sections on the Wave website (shown similarly below), they don’t require separate accounts. These solutions are integrated within your dashboard and you’ll access them both through your single Wave login.
Wave Accounting
Price: Free.
Features:
- Unlimited income and expense tracking.
- Customizable sales taxes; sales tax tracking.
- Double-entry accounting.
- Unlimited bank and credit card connections.
- Exportable accounting reports and financial statements.
- Real-time dashboard monitoring for cash balances and invoice statuses.
- Digital receipt upload and transaction management.
Wave Invoicing
Price: Free.
Features:
- Unlimited invoicing.
- Automatic payment reminders.
- Ability to turn estimates into invoices once approved.
- Customer communications management.
- Ability to accept online credit card and bank payments within invoices using Wave Payments (fees apply).
- Option for invoices and accounting to sync automatically.
- Ability to create and send invoices, monitor payment statuses and receive notifications using the Wave invoicing mobile app.
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In addition to its free services, Wave has software that does come with fees, including Wave Payments and Wave Payroll.
Wave Payments
Payment processing pricing:
- 2.9% plus 30 cents per transaction for Visa, MasterCard and Discover payments.
- 3.4% plus 30 cents per transaction for American Express payments.
- 1% per transaction ($1 minimum fee) for bank payments.
Features:
- Accept credit card payments over the phone, online or in person.
- Set up recurring billing with automatic payments.
- Sync with your Wave account; automatic payment reconciliation with Wave Payments.
- Receive credit card payments within two business days and bank payments in two to seven business days.
Wave Payroll
Pricing:
- Full-service: $35 per month plus $6 per employee/independent contractor paid per month.
- Federal and state tax payments will automatically be transferred on your behalf.
- Available only in the following states: Arizona, California, Florida, Georgia, Illinois, Indiana, Minnesota, New York, North Carolina, Tennessee, Texas, Virginia, Washington, Wisconsin.
- Self-service: $20 per month plus $6 per employee/independent contractor paid per month.
- Wave will calculate what you’ll owe in state and federal taxes, but you are required to file the paperwork and submit payment.
Features in both versions:
- Run payroll and pay employees with direct deposit.
- Employee self-service: employees can update bank and contact info, view pay stubs and tax forms
- Generate W-2 and 1099 forms.
- Monitor employee leave time and accruals.
- Sync automatically with all other Wave products.
- Receive priority access to customer support.
Wave Advisors
Pricing:
- Bookkeeping and payroll support: Starts at $149 per month.
- Tax service: Starts at $1,500 per year.
- Accounting and payroll coaching: $229 one-time fee.
Features:
- Receive personalized support from in-house Wave professionals.
- Use Wave’s bookkeeping service to outsource your bookkeeping or use accounting coaching to learn how to do it yourself.
- Work with a professional to file your taxes.
- Receive guidance to set up your Wave account and go through the basics.
Accounting softwareFREE
$0
No set-up fees, no hidden charges, no monthly fee
- Unlimited income and expense tracking
- Track sales tax on income and expenses
- Add unlimited partners, collaborators or accountants
- Fully functional double entry system. Generate financial statements for year-end
- Powerful reports on Overdue Invoices & Bills, Cash Flow, Profit & Loss and more
- Unlimited bank and credit card connections
- Easily organize income and expenses into tax categories
- Run multiple businesses in one account
- Instantly see how your business is performing on your dashboard
What is Form 1099-K?
A 1099-K is an informational form that summarizes the online payment activity in your Wave Payments account. If your business uses Wave Payments and you’ve processed more than $20,000 AND also processed over 200 transactions in the calendar year, Wave will provide a copy of your 1099-K to you, and a copy to the IRS.
What is Form 1099-NEC?
Form 1099-NEC is an IRS form that summarizes all non employee compensation your business has paid to a contractor. Independent contractors use these forms to file their taxes.
You must provide Form 1099-NEC to any contractor you paid $600 or more during the calendar year. If you use Wave Payroll, Wave will generate a 1099-NEC form for every contractor who qualifies. Wave can also file these forms for you electronically.
What is Form 1099-MISC?
Form 1099-MISC, Miscellaneous Income is an IRS form that summarizes miscellaneous payments outlined by the IRS your business has paid during the year. Prior to the 2020 tax year, it was also used to report non-employee compensation. Employers who used Wave for the 2019 tax year or earlier and generated 1099-MISC tax forms will still find these in their account.
Wave does not support producing 1099-MISC forms for the 2020 tax year on.
Benefits of Wave accounting
Free
It’s hard to beat free accounting software, especially if you’re running a small business on a budget. With Wave, you receive access to a double-entry accounting solution that includes unlimited bank and credit card connections, unlimited income and expense tracking, unlimited invoicing and unlimited partners, collaborators or accountants, features that are not always included with paid accounting software plans.
Moreover, unlike some other free software options, Wave doesn’t require that you buy expensive add-ons to be fully functional for accounting, bookkeeping or invoicing. It does, however, offer additional services if you’d like to expand your capabilities within the system.
Customizable invoicing
Wave automatically syncs your invoicing and accounting, making it a particularly compelling software for businesses that want to manage their billing and bookkeeping in one place. Wave’s invoicing is also free and unlimited, with customizable templates and a user-friendly interface, putting it on par with some of the top invoicing solutions for small businesses.
In addition, Wave allows you to add and manage customer profiles and send payment reminders, receipts and follow-up emails. It also offers a dedicated invoicing mobile app so that you can send invoices, track payments and communicate with customers from any device.
There’s also the option to apply for Wave Payments to accept payments from your customers online and offers automatic transaction reconciliation for these payments.
Easy to use
Wave accounting is simple and easy to use, with a user-friendly interface and intuitive design. Unlike some accounting software, you don’t need prior knowledge to get the most out of the system; you can easily navigate the platform and quickly learn as you go.
Wave also offers a thorough online Help Center with guides on setting up your account and completing common tasks, as well as video tutorials for accounting basics. You can also talk to other business owners about tips or questions you may have through the Community forum on Wave’s website. Back to top
Drawbacks of Wave accounting
Not scalable
Wave’s free accounting software can be a great option if you run a small business or don’t need more advanced features that alternatives might offer. For businesses focused on expansion, however, Wave is extremely limited. Unlike competitors, Wave doesn’t offer multiple plans to increase the software’s functionality.
For example, QuickBooks Online doesn’t have a free plan, but it’s an excellent choice for scalability as it offers four different plans, each of which includes additional features. With the higher-tier QuickBooks plans, you have access to time tracking, inventory management and job costing, none of which are offered with Wave.
Limited customer service
Wave offers customer support through live chat and email. The support team usually responds to emails within two business days, according to a company representative. Phone support is available, but only for those using Wave Advisors.
Although Wave accounting customers can talk to a chatbot and receive automated answers, live customer support agents are available only for paid services (Wave Payroll or Wave Payments).
Conclusion
Wave accounting software is a cloud based small business accounting software, it’s the world’s number one accounting software for small business. Wave allows you to spend less time on paperwork and more time focusing on your business. No installation, no data entry, no downloads, and no IT support required!