QuickBooks vs Xero 2024: Which Software Is Better for You?

xero vs quickbooks online

If you often need to record bills and bill payments on the go, Xero’s mobile app might be preferable. Both Xero and QuickBooks Online do a great job of accounting for inventory and calculating the cost of your inventory sold automatically. However, inventory accounting is included in all Xero plans while it’s only in the Plus and Advanced versions of QuickBooks Online. So, if you want a low-cost inventory management solution, go with Xero. Quickbooks is a more scalable solution than Xero when it comes to bills and monthly invoices, which are both unlimited in all plans. Xero’s Early plan gives you 5 bills and 20 invoices and only offers unlimited invoices and bills starting in their second product tier.

How much does QuickBooks training cost?

xero vs quickbooks online

Accounting software is essential for more than keeping your books current. It’s also vital for tracking cash flow, invoicing clients virtual cfo services and paying vendors. On top of the shared features listed above, both QuickBooks and Xero have inventory management tools.

Price and Plans

It is possible to purchase cloud access so your team can better collaborate and access the software and its data from anywhere, but costs add up quickly with an additional monthly charge per user. Both services do offer an app marketplace, for both in-house mobile apps and integrations or extensions offered by third-party services. Xero offers more integrations overall, but both are very comprehensive.

Features: QuickBooks Online Wins

The right accounting software can streamline all sorts of processes, from managing tax returns and payroll to using powerful tools to predict the future. Xero will be the first major accounting platform to offer Tap to Pay in the UK and Australia, enabling businesses to accept payments on the spot, right from their Xero Accounting app. Add a ‘pay now’ button to your online invoices and get paid up to twice as fast. If using Apple Pay, for example, a customer won’t need to log into their online bank account or go fetch their credit card and enter their details manually, which saves time and the risk of manual error. Discover how our accounting software is evolving with payment features including Buy Now Pay Later and eInvoicing.

xero vs quickbooks online

  1. Depending on the plan you select, QuickBooks Online’s monthly prices run from $30 for the Simple Start plan to $200 for the Advanced plan.
  2. QuickBooks Online is an industry leader in the accounting field, thanks to its strong feature set and scalability.
  3. And you can also easily add inventory Items to quotes, invoices and purchase orders to make billing easy.
  4. This means that Xero Early may be as cheap as $6.50 per month when 50% off, while QuickBooks Simple Start would cost just $9 a month, provided it is offering the same deal.

However, QuickBooks Online has a little more value than Xero in terms of features and capabilities, which is something to keep in mind as you compare the two. If you wanted this view, you would have to go to banking (bank feeds), then to the account transactions. Then, you can sort by reconciled status, or use the search feature on this section. When you link up your Xero account to download transactions from your bank, you have to set up the right starting balance per the bank. From that point, your balance per bank is a calculated balance—this calculated balance can be manipulated, meaning it can be incorrect.

This requires the software to allow users transitioning from other bookkeeping software to import their chart of accounts (COA), vendors, customers, service items, and inventory items. Ideally, there will be a wizard to walk the user through the import process. The software must have features that allow users to set sales tax rates, apply them to invoices, and enable users to pay sales tax liability.

xero vs quickbooks online

Some businesses may rely on those features, however, particularly if they opt for top-down oversight that requires greater control. This is because QuickBooks offers an add-on specifically for time tracking, starting at $20 per month (plus $8 per user), while Xero bundles time tracking with its main service. QuickBooks and Xero both offer a lot of features, including all the core abilities that make these two options the best small business accounting software around. As with QuickBooks, you can use Xero to generate custom branded invoices, send client payment reminders, and view invoice payment status.

NerdWallet independently reviews accounting software products before determining our top picks. We collect the data for our software ratings from products’ public-facing websites and from company representatives. Information is gathered on a regular basis and reviewed by our editorial team for consistency and accuracy. Wave Accounting is a free accounting solution for very small service-based businesses, contractors, freelancers and consultants.

The software must have tools to track time, record billable hours or expenses, send invoices for progress billings, or monitor project progress and performance. One of the most important features any accounting tool can offer is integration with your business bank accounts. Ideally, you’ll want all your transactions flowing seamlessly into the software, with regular updates helping you keep on top of your cashflow. Both can integrate seamlessly with Wise Multi-currency account which is specifically handy for sending and receiving international payments. It’s most basic ‘Starter’ plan is for sole traders and startups and offers up to 20 invoices/quotes and 5 bill payments a month.

While Xero and QuickBooks are wildly popular, they’re not the only options available. There are a number of alternative accounting software programs that can offer powerful features and a user-friendly interface. If you need to give accounting access to more than five people, Xero could be the better option for you.

You can simply download the free Xero Projects app on iOS and Android, using it to record time and costs, as well as seamlessly and automatically feed the data into invoices and reports. Premium includes scheduling for jobs and shifts, real-time reporting, custom alerts, and time-off management. Elite offers all of Premium’s features, plus a project activity feed for better control, project estimates that can be easily compared with actuals, geofencing, and support for timesheet signatures.

However, despite Wave’s advantages, its overall offering is pretty basic and support tools leave a lot to be desired, giving it a 4/5 score overall. With this in mind, if you’re after feature-rich software and can afford to pay a slight premium, QuickBooks and Xero will be more reliable options. While Xero’s $13 Early plan is far cheaper than QuickBooks’ $30 Simple Start plan, it’s also very limited due to the caps on invoices and billing. A better comparison is the $60 QuickBooks Essentials plan (plus the $45 Core or $80 Premium payroll plans) vs. the $37 Xero Growing plan (paired with the $40 or $80 Gusto plan). Essentials supports just three users, while Growing is unlimited, making it better value for large or growing operations.

Plus, read receipts let you know when customers have seen an invoice and if it’s been paid. Xero’s only customer support options are an email system and a knowledge base. As the leading business accounting software platform, QuickBooks is unsurprisingly a standout when it comes to integrations. The platform offers high-quality built-in integrations with many leading business software vendors. For example, QuickBooks integrates with Square, Gusto, PayPal, eBay, Shopify and Etsy.

Both accounting software products let users invite their accountants by email. If you’re located in the United States, though, there’s a better chance your accountant is familiar with QuickBooks Online than Xero. QuickBooks Online is an industry standard with more than 5 million users worldwide. If you count QuickBooks Desktop users, that number rises to 8 million. With more than 3 million users worldwide, Xero is popular but not as ubiquitous as QuickBooks Online.

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