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Best Small Business Accounting Software Options for Business Owners

best small business accounting software

As you grow your business and your accounting needs become complex, you may want to turn to accounting software to help you balance your books. There are a number of services available that provide invoicing, payroll and project management services to make it a bit easier to run your business. Here are the five best small business accounting software programs to give your bookkeeping a boost.

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5 best small business accounting software options

1. QuickBooks

QuickBooks online software covers business owners’ major accounting needs. QuickBooks helps you manage your bills and payments, as well as income and expenses. You can create custom invoices and track the status of each one. QuickBooks also helps you keep track of billable hours for clients or employees, and employees have the option to enter their own hours into the program. QuickBooks offers a 30-day free trial and subscription plans start at $20 per month. Payroll services are available for an added fee.

Pros

  • No contract. You can switch or cancel your QuickBooks plan at any time. Your subscription also includes a 60-day guarantee.
  • Free apps. QuickBooks provides free mobile apps for iOS and Android.

Cons

  • Payroll service is extra. If you need payroll services, you’ll have to add a payroll plan to your QuickBooks subscription.
  • Free option not available. After your 30-day free trial, you would have to sign up for a QuickBooks subscription plan to continue using the service.

Bottom line

QuickBooks offers comprehensive online accounting services for small businesses. Three available subscriptions tiers allow you to choose the right amount of services for your business and your budget. QuickBooks provides reports to help you understand how much money your business generates to better control your cash flow. If you need outside assistance, you could send reports to your accountant from the QuickBooks platform.

2. FreshBooks

Cloud-based accounting software from FreshBooks allows you to manage your invoices, expenses and projects from your desktop, phone and tablet. You can create and send custom invoices, adding due dates and payment requests in each one. FreshBooks also tracks your hours to help you work more efficiently and bill for the correct amount of time worked. You can collaborate on projects with your team through FreshBooks, which lets you share files, assign due dates and check the status of a project. FreshBooks is best for self-employed small business owners, as well as consultants and agencies with a large client base. Monthly subscription plans start at $15 per month after a 30-day free trial. You could save 10% by purchasing a yearly plan, which starts at $13.50 per month.

Pros

  • Send unlimited invoices. All subscription plans allow you send an unlimited number of invoices and estimates. You can also accept online credit payments with each plan.
  • Work on the go. FreshBooks offers free apps for iOS and Android, allowing you to send invoices from your phone. You can upload receipts to the FreshBooks app as well.
  • Phone support available. FreshBooks provides customer support via phone for those who want to speak to a person. You can also send an email or check FreshBooks’ online resource to find an answer to your question.

Cons

  • Payments aren’t free. Accepting payments through FreshBooks would cost you 2.9% of each transaction plus a $0.30 fee.
  • No payroll features. You can track your employees’ hours through FreshBooks, but the software does not provide an option to manage payroll.

Bottom line

FreshBooks helps small business owners improve their client relations. You can send and track invoices and remind clients when a payment is due. You can also organize team projects within the software, including as many team members as your subscription plan allows. The varying subscription tiers give you the option to choose what you need from the service at a cost that works for you. You can try FreshBooks for free for 30 days and cancel your subscription at any time.

3. Wave

Using Wave, you can send custom invoices and receipts to clients and track your expenses and transaction data. Wave also lets you pay your employees and automatically deducts payroll taxes. The software is completely free, and includes unlimited income and expense tracking, unlimited receipt scanning and the option to give as many people access to your account as you need. You can manage multiple businesses through one Wave account. You can add payment processing and payroll services to your software package, but you would have to pay a fee.

Pros

  • Totally free. Wave’s basic accounting software is completely free without any trial periods or hidden fees. The software includes invoicing, accounting and receipt scanning.
  • Information automatically syncs. All invoicing and payment information syncs with Wave’s accounting software to keep your bookkeeping up to date.

Cons

  • Payments and payroll are extra. To accept online credit card payments, you would have to pay $0.30 and 2.9% per transaction. You would also have to wait two days to get paid out. Payroll fees range from $20 to $35, depending on your state of residence.
  • Limited services. Wave does not provide time tracking, inventory tracking or project management services.

Bottom line

Wave’s free software provides basic accounting services for small business owners. While Wave is likely to fit every budget, it may not provide all the services that business owners need. However, Wave helps you track your income and expenses and prepare for tax time without making a financial commitment. Your data is stored in the cloud and you can access it from any device.

4. Sage

Sage Business Cloud Accounting offers accounting solutions to small business owners looking to improve cash flow and spend less time on administrative tasks. Sage sends invoices and tracks payments and expenses. Sage also helps you prep for tax season by automatically calculating what you owe. Your data is stored on the cloud and you can access your account from Sage’s iOS and Android apps.

Pros

  • Free trial. Sage offers two tiers of service – Accounting Start for $10 per month and Accounting for $25 per month – and both come with a free trial of all of the features.
  • Track your performance. The Sage app allows you to view weekly, monthly and yearly performance reports to compare to previous periods of time. Sage’s app is available for iOS and Android.

Cons

  • No time or project tracking. Sage’s accounting software does not include any time tracking or project collaboration features. The first subscription tier allows just one user while the higher tier allows up to five users.
  • Payroll is separate. Sage offers a separate product for payroll services. The payroll software does not integrate with the cloud accounting program, but it does work with Sage 50cloud, Sage’s desktop accounting software for businesses.

Bottom line

Sage Business Cloud Accounting helps business owners manage and organize their expenses and payments all in one place. You can take care of your accounting from anywhere using Sage’s mobile app. If you need more advanced features, such as payroll, you would have to purchase additional software. But Sage offers two subscription plans for its cloud accounting program, allowing you to choose a plan that’s within budget.

5. Xero

Xero’s online service lets you send custom invoices from your phone and tablet. You can also track your inventory and create purchase orders to attach to bills for payments. Xero can send you updates on your invoices, so you’ll know when they’ve been received. Xero’s subscription plans start at $9 per month. All plans include apps for iOS and Android, financial performance reports and the ability to connect your bank account. Starting in 2019, Xero will offer payroll services through a partnership with Gusto, a cloud-based payroll provider.

Pros

  • Sync with other apps. Xero syncs with payment apps such as PayPal and Stripe to allow clients to pay you online.
  • Find local resources. Xero provides a tool for business owners to find an industry-specific accountant or bookkeeper in their area.

Cons

  • No live support. Xero offers informative articles on a number of topics but does not provide a phone number to call if you have questions. However, you can join a community discussion to talk with other Xero users about any issues you may have.

Bottom line

Xero’s wide-ranging cloud accounting services allow you to access your business finances anytime from any device. You can analyze your cash position in real time and collaborate with an accountant and bookkeeper through the software. By tracking your invoices with Xero, you can make sure you get paid in a timely matter. You can try Xero for free before subscribing to a monthly plan. You can cancel at any time, but you must provide at least one month’s notice.

 

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