Good accounting software saves hours of bookkeeping and prevents costly tax mistakes. This guide compares the best options for small businesses, freelancers, and growing companies.
Best Accounting Software 2025
- Best Overall: QuickBooks Online ($30/mo) - Most features, best ecosystem
- Best for Growth: Xero ($15/mo) - Unlimited users, great for scaling
- Best for Freelancers: FreshBooks ($19/mo) - Easy invoicing, time tracking
- Best Free Option: Wave (100% free) - Full features, no cost
- Best for E-commerce: Zoho Books ($0-$275/mo) - Inventory management
Top Accounting Software Compared
| Software | Starting Price | Users Included | Best For | Rating |
|---|---|---|---|---|
| QuickBooks Online | $30/mo | 1-25 | Most small businesses | |
| Xero | $15/mo | Unlimited | Growing companies | |
| FreshBooks | $19/mo | 1 (+ $10/user) | Service businesses | |
| Wave | Free | Unlimited | Startups, freelancers | |
| Zoho Books | $0/mo | 1-15 | E-commerce, inventory | |
| Sage Business Cloud | $25/mo | Unlimited | Manufacturing |
Detailed Software Reviews
TOP PICK
QuickBooks Online
- Pricing: Simple Start $30, Essentials $60, Plus $90, Advanced $200/mo
- Pros: Most accountant familiarity, 750+ integrations, robust reporting
- Cons: Expensive, limited users on basic plans
- Best for: Businesses needing full accounting with CPA collaboration
BEST VALUE
Xero
- Pricing: Early $15, Growing $42, Established $78/mo
- Pros: Unlimited users on all plans, beautiful interface, 1,000+ integrations
- Cons: Fewer US accountants know it, invoice limit on basic plan
- Best for: Growing teams, businesses with multiple users
FREELANCERS
FreshBooks
- Pricing: Lite $19, Plus $33, Premium $60/mo
- Pros: Best invoicing, built-in time tracking, client portal
- Cons: Limited inventory, fewer integrations
- Best for: Service-based businesses, consultants, agencies
Feature Comparison
| Feature | QuickBooks | Xero | FreshBooks | Wave |
|---|---|---|---|---|
| Invoicing | Excellent | Excellent | Best | Good |
| Expense Tracking | Excellent | Excellent | Good | Good |
| Bank Reconciliation | Excellent | Excellent | Good | Good |
| Inventory | Good | Basic | Basic | None |
| Payroll | Add-on $45+ | Add-on $40+ | Add-on $40+ | Add-on |
| Time Tracking | Add-on | Basic | Built-in | None |
| Project Management | Plus plan | Add-on | Built-in | None |
Essential Features to Look For
Core Accounting
- Double-entry bookkeeping: Proper accounting method
- Bank feeds: Automatic transaction import
- Reconciliation: Match transactions to statements
- Financial reports: P&L, balance sheet, cash flow
- Chart of accounts: Organize transactions
Billing & Invoicing
- Custom invoices: Add logo, customize templates
- Online payments: Accept cards, ACH, PayPal
- Recurring invoices: Automate regular billing
- Payment reminders: Automated follow-ups
- Estimates/quotes: Convert to invoices
Pricing Deep Dive
Total Cost Considerations
- Base subscription: Monthly fee for core features
- Additional users: $10-25 per user/month
- Payroll add-on: $40-150/month + per employee
- Payment processing: 2.9% + $0.25 per transaction
- Integrations: Some charge separately
- Accountant access: Usually free
Free Options Worth Considering
Wave (Completely Free)
- Full accounting features at no cost
- Unlimited users and transactions
- Makes money on payment processing and payroll
- Great for startups and simple businesses
Zoho Books (Free for Small Business)
- Free for businesses under $50K revenue
- Includes invoicing, banking, reports
- Part of larger Zoho ecosystem
How to Choose
- Assess your needs: Invoicing only? Full accounting? Inventory?
- Count users: Who needs access? Employees, accountant, bookkeeper?
- Check integrations: Does it work with your other tools?
- Ask your accountant: What do they prefer to work with?
- Try free trials: Most offer 30-day free trials
- Plan for growth: Will it scale with your business?
Migration Tips
- Export old data: Download all transactions, reports
- Start fresh at fiscal year: Easier reconciliation
- Import chart of accounts: Maintain consistent categories
- Reconcile opening balances: Match to bank statements
- Run parallel systems: For 1-3 months during transition