Best Accounting Software for Small Business | 2021

by Elma Mrkonjić

Efficiency is a force that keeps businesses afloat. Now that the throes of the pandemic still rage on, the efficient use of the best accounting software for small business can maximize resources, improve productivity, save time, and most importantly, avoid costly business mistakes at such a crucial time.  

But the question of which accounting software to use remains hanging. So here’s a detailed article that goes in-depth into the best accounting software programs today, with heaps of information on their features, offers, and more. 

Best Accounting Software for Small Businesses

quickbooks logo

QuickBooks

Its flexibility and extensibility make it ideal for independent contractors needing basic bookkeeping features and small business owners who want absolute functionalities to check their business health. Quickbooks for small business has an easy-to-use interface loaded with features suitable for any small business needs. 

Wave

Wave accounting software is a tool specifically designed for entrepreneurs. It has fully automated functionalities that combine invoicing, payroll, and payments in one package. The best thing about Wave is that it’s 100% free — no hidden fees, no trial periods, and no credit card details needed when signing up.

bizsight logo

BizSight 365

BizSight 365 is financial accounting software that replaced Microsoft Small Business Accounting software or what was initially known as Microsoft Office Accounting (MOA). It has three editions: cloud-based, on-premise, and manufacturing. It’s partnered with Microsoft Azure to provide an end-to-end cloud accounting solution to manage any small business, whether it’s service-focused or product-centered.

Xero

Xero is an all-in-one tool that’s considered one of the best accounting software for small business. Its app marketplace has over 800 third-party apps that users can integrate to customize the software and turn it into a powerful tool for financial management. Paid users get access to the mobile app, which gives them the capability to manage their business, while they are on the move.

FreshBooks

FreshBooks combines several almighty accounting features in its software, allowing it to save users up to 192 precious hours yearly. No wonder it has over 24 million users and also tops the list of the best online accounting software for small business. Its efficient accounting tools support the team, business, and clients, which are the most significant aspect of each company. Its essential edge is its intuitive double-entry accounting tools.

Accounting Software for Small Business Reviews

QuickBooks

Essential Features
  • Bank-level security
  • Automatic invoicing
  • Accountant access
  • Mobile apps for people on-the-go
  • E-file service
Additional Features
  • Customizable reports
  • Unlimited invoices
  • Varying add-on services

Overview

QuickBooks offers accounting software packages marketed by a top accounting software company, Intuit. Its line of products targets to meet the varying needs of 4.5 million small to medium-sized businesses.

Users can choose between QuickBooks Desktop, a one-time purchase license-based installable application, and QuickBooks Online, cloud-based software with a recurring monthly cost.

Pricing Plans

Plans on QuickBooks for self-employed cost differently. But they sure suit any business’s needs.

Simple Start | $8 monthly or $151.36 yearly

  • It gives access to one user plus your accountant.
  • With QuickBooks simple start, you can review your income and expenses, create invoices, and other basic features.

Essentials | $12.50 monthly or $237.60 yearly

  • It gives access to three users plus your accountant.
  • Besides tracking and invoicing features, this includes insights and reports and multi-currency tools.

Plus | $17 monthly or $322.96 yearly

  • It gives access to five users plus your account.
  • This plan includes extra features to track inventory, projects, and locations, manage budgets and recurring transactions.

All plans also include a 30-day trial. That is perfect for those who hesitate whether to get the software or not.

Features

Simplified accounting
Quickbooks payroll options and its income and expenses tracking features enable businesses to organize all their finances and cash flow in one place.

Unlimited invoiced and advanced invoicing features
Send unlimited invoices any time from a mobile phone. Its automated invoicing features allow users to generate invoices and automatically send them to regular clients, saving time.

Multiple and flexible plans for easy scalability
Whether you’re a freelancer or a solopreneur looking to take your business to the next level, this easy accounting software has flexible plans that frame the needs of every small business.

Over 650 app integrations
Eliminate other manual work by integrating multiple third-party apps that you already use, like PayPal, Amazon, Shopify, and over 650 more apps.

One-click reporting
With just a click, you can get insights into how your business is doing. Just view the balance sheet, profit and loss records, and other reports.

Multiple Currencies
Simplify bank reconciliation and generate reports in different currencies. QuickBooks supports more than 150 currencies, making it one of the best accounting software for startups.

Cloud, SaaS, desktop app, and mobile app
Access QuickBooks via the web, desktop app, or mobile app, anywhere you are.

Customer Support

Its exceptional customer support is reachable in various ways. Depending on your concern, you can get help from its dedicated phone support, search through the resources, or post your question in the online community.

You can find phone support at 1 (877) 683 3280 from 5 am to 6 pm PST, Monday through Friday, and 7 am to 4 pm PST on Saturday and Sunday to get immediate help with your concern.

It also has in-software assistance in the form of an AI live chat and an online international community and help center where you’ll find answers to important topics, like accounts, banking, tax, and more.

Strengths and Weaknesses | The Verdict

All in all, QuickBooks offers an across-the-board accounting software service that makes it a top choice for small businesses. With its scalable plans, it’s also one of the best accounting software for medium-sized business ventures.

QuickBooks pulls together the best functions to streamline every financial aspect of the business, from payroll to card payments, budgeting, tracking, and sales tax collection and filing. It’s straightforward and makes collaboration simpler.

Its only drawback is that the subscription plans are quite costly. There’s also an extra cost to its services, as the filing of 1099 tax forms costs $14.99. Unless budget is a fundamental issue, you’ll find QuickBooks highly efficient.

Wave

Essential Features
  • Unlimited tracking of income and expenses
  • Detailed reports on cash flow and more
  • Run multiple businesses in a single account
  • Unlimited receipt scanning
Additional Features
  • Basic inventory
  • Free Android and iOS mobile app
  • Zapier integration to over 1,000 apps
  • Encrypted cloud

Overview

Wave for small business has everything you need in one place. Since 2010, Wave has tracked over $330 billion in expenses and income and served millions of small businesses. Users love it because it provides unlimited income and expense tracking and several more accounting features at absolutely zero cost.

There is no need to install any software as Wave is cloud-based. Plus, it has paid services, such as payment processing and payroll, saving you from the hassle of looking for another vendor.

Pricing Plans

Wave offers online accounting software free of use for everyone. That includes income and expense tracking, financial statements, reports, receipt scanning, and more. You don’t pay a dime for this unless you sign up for its add-on services with the following prices:

Payroll Services

  • A. Self-service Payroll: $20 monthly + $6 monthly per employee or independent contractor.
  • B. Tax service Payroll: $35 monthly + $6 monthly per employee or independent contractor.

Tax Service | $129 per month

  • Includes filing tax returns, representing you before the IRS, quarterly review, and more.

Bookkeeping Service | $129 monthly

  • Includes planning, categorizing transactions, reconciliation, and more.

Accounting Coach | $79 monthly or $199 one-time fee

  • Receive advice, guidance, and live coaching on the best way to handle accounting in your small business.

Features

Wave dashboard
Get instant insights into your business, such as expenses breakdown, via one of the most used accounting software.

Professional invoice templates
Make recurring or one-time billing and invoicing easy with customizable templates that are free to use.

Free Mobile App
Send invoices, perform significant transactions, and track your business anytime and anywhere you go.

Multi-Currency
Wave supports over 160 currencies with exchange rates that are updated daily.

Chart of accounts
Get access to a chart of accounts that’s configurable to help you make accounting as simple as possible.

Inventory
Add item names, descriptions, and prices for easy billing.

Reports
Generate 12 different reports, such as a cash flow report, either accrual or cash-basis, for easy quarterly or yearly comparison.

Cloud, SaaS, and mobile app
Wave is 100% web-based, but you can download its invoicing and receipt scanning apps on mobile.

Customer Support

In addition to being one of the best accounting software for contractors, Wave’s multi-channel customer support is also what makes it stand out. It provides in-account support, which enables users to contact support through the in-software support form.

It also has its help center if you need navigational instructions and how-to guides related to accounting. If you need business tips or want to discuss ideas with fellow entrepreneurs, the online community is the best avenue.

Phone and chat support are available for paid services only, such as payroll and credit card payment processing. As for email, customer support is available via [email protected].

Strengths and Weaknesses | The Verdict

Fair Wave software reviews are swarming the internet, which says something about the company’s reliability. If you’re a freelancer, independent contractor, or entrepreneur, who has no budget but needs accounting software that does the job, look no further than Wave.

Getting free accounting software with good features sounds too good to be true. Yet, that’s what Wave is. If you don’t mind the primary elements of a small business accounting software that’s free, then you should be good to go with Wave. It has solid invoice customization options and a tad more detailed record templates.

You can improve Wave by including a dedicated time-tracking feature, which it currently doesn’t have. Overall, Wave has excellent service.

BizSight 365

Essential Features
  • Easy setup
  • Leverages current technologies
  • Multi-language and multi-currency
  • International support
Additional Features
  • Supports most common browsers
  • Reporting and dashboards
  • Create inventory receipts and purchase orders
  • Customizable invoices and other templates

Overview

BizSight 365 is flourishing as one of the best online accounting software for small businesses today. It’s a second-generation and entry-level Software-as-a-Service (SaaS) solution hosted on Azure. It is based on different pieces of technology used by Microsoft itself, allowing it to support common browsers.

Its accounting, payroll, reporting, and other robust features run on the latest technology, so there’s no need to worry about downtimes during upgrades or updates. Unlike other software, BizSight 365 caters to bilingual clients, which is a unique advantage.

Pricing Plans

As one of the best accounting and payroll software for small business, BizSight loves to keep it simple when it comes to pricing.

Free 3-month trial

  • The first three months are in the house. Therefore, you’ll have 90 days to try its features and gauge whether it fits your needs.
  • Features include invoicing and payments, tracking, recording, journals, bank reconciliation, and more.

Pro | $15 monthly per user

  • Includes the same features found in the free trial, plus importing and exporting Excel files, inventory adjustments, and physical count.

Manufacturing | $35 monthly per user

  • Offers software for small businesses in the manufacturing field to enable more control in the inventory, sales orders, and purchase orders.
  • Includes material planning, WIP and cost tracking, employee time tracking, production reporting, and more.

Features

All-inclusive cloud-based accounting capability
It lets you create and customize invoices in a snap, add detailed notes, and track income and expenses in the cloud or local device.

Sales orders tracking
Track drop-ship purchases and backorders.

Organized Recording
Keep detailed data on vendor bills, cash and credit expenses, and purchase orders.

Inventory
It’s packed with tools for costing, inventory control, and physical count, perfect for small businesses requiring regular inventory records.

Manufacturing
Create and track work orders, costs, work-in-process goods — ideal for businesses in the manufacturing industry.

International support
BizSight 365 has already been used in the US and 13 other countries in varying industries. It has dedicated global support with multi-currency and VAT.

Cloud, SaaS, and desktop app for Windows
Access your account through the web or locally installed software.

Customer Support

Customer support is reachable via email at [email protected], phone (614) 352-2472, and the site’s Contact Us page.

BizSight 365 offers a personalized annual phone support service to users to get the most out of the software subscription. It covers software assistance, remote desktop access, business guidance, and more from its service partners, CPA firms, and technology vendors. The prices are $175 for a single incident, $500 for 3-pack support incidents, and $750 for 5-pack support incidents.

Strengths and Weaknesses | The Verdict

BizSight 365 is reasonably priced, so it’s one of the best accounting software for small business out there. It’s a reliable company, given that it’s collaborated with Microsoft Azure to enable cloud service and uses the latest software technology.

Anyone can try it for three months without any fee — it’s the longest-running trial period you can get from accounting software. Plus, it also has global support for Spanish, Portuguese, and other speakers, leaving non-English customers with a positive experience.

Its personalized phone support is a bit expensive. However, it can be considered an investment, especially for first-time small business owners who don’t know a thing about accounting.

Xero

Essential Features
  • Bank reconciliation
  • Contacts and smart lists
  • Payroll and benefits management
  • On-time bill payments
Additional Features
  • Automatic data key in using Hubdoc
  • Real-time reporting
  • Inventory
  • Sales tax

Overview

Since 2006, Xero has grown to have over two million subscribers and several global offices. Its software optimizes a single unified ledger, allowing business owners to record and work in a similar set of books the entire time. It accepts payment solutions and is the best accounting software for Amazon sellers or business owners who engage in any form of online selling.
Its robust accounting software lets users do all accounting tasks, from invoicing to monitoring employee spending.

Pricing Plans

Whether you need basic or advanced accounting software, Xero brings flexible plans for all-sized businesses.

30-Day Free Trial

  • Test Xero’s features without limitations for one month free of charge.

Starter | $20 monthly

  • Suits sole traders, freelancers, and new businesses that seek key accounting features.
  • Send quotes and up to 20 invoices.

Standard | $30 monthly

  • Ideal for growing small businesses.
  • Unlimited invoices, quotes, bills, bank reconciliations, and bills.

Premium | $40 monthly

  • For any sized and established business.
  • Includes the standard features with the added benefit of multi-currency.

As one of the best online accounting software for small business, it offers optional services, such as claim expenses and project tracking, for $4 and $7 per month, respectively.

Features

Bills tracking
Helps users stay on top of their bills, cash flow, and accounts payable.

Bank connections
Allows users to link their bank accounts for seamless and secure transactions.

Payment solutions
Connect to payment solutions like Stripe to make online payment processing faster.

Bank reconciliation
Keep your account up-to-date by reviewing and matching transactions daily using suggested matches.

Contacts and smart lists
Review your client or supplier’s sales, invoices, emails, and other transactions in the contact history.

App integration
Choose from over 800 apps in the app marketplace and personalize your software by integrating payroll, point-of-sale, and other software solutions.

Cloud, SaaS, and mobile app
Besides accessing via the web, apps for iOS, Android, and iPad are available to download.

Customer Support

Xero is a top accounting software solution that provides unlimited user support 24/7 for free. But if you have questions and want immediate answers, you can search through its resource center’s posts and discussions.

If you’re unable to get answers from posts, you can log in and hit the Get in touch button at the end of each support article, and someone will get back to you through email.

Xero doesn’t have inbound phone support, so it doesn’t have any phone numbers. In cases where you need phone support, you can request it by filling out the online form.

Strengths and Weaknesses | The Verdict

Xero is one of the best accounting software for Shopify, Amazon, or any other ecommerce businesses. The company is trusted and reliable and one of the industry’s premier software companies. With its powerful accounting features, business owners can remain on top of their finances.

Compared to its competitors, Xero’s accounting pricing may be more costly. Moreover, it lacks phone and chat support, which is a hassle. Users can’t get immediate resolutions as the only available channel for assistance is via email.

FreshBooks

Essential Features
  • Accounting and payroll
  • Collaboration and PM software
  • Expense and time tracking
  • Supports project management
Additional Features
  • Customizable proposals
  • Online payments setup
  • Dashboard and reports
  • Quotes and custom estimates

Overview

FreshBooks started as an electronic invoicing solution for IT professionals in 2004. Now, it’s among the best software for small business accounting.

It offers a versatile accounting solution that optimizes double-entry accounting — a system in which each account entry gets a corresponding opposing entry in a different account.

It supports time tracking, project management, and collaboration, ensuring that the team is always at a productive peak.

Pricing Plans

FreshBooks offers monthly and yearly plans that fit the budget.

Lite | $4.50 monthly or $108 yearly

  • For professionals and freelancers
  • Up to five billable clients

Plus: $7.50 monthly or $180 yearly

  • For small business owners wanting more insights and automation features
  • Up to 50 billable clients

Premium: $15 monthly or $360 yearly

  • For growing businesses
  • Unlimited billable clients

Select | Custom pricing

  • For businesses with complex accounting needs
  • With specialized features
  • Unlimited billable clients

If you’re on the fence about selecting the best free accounting software for small business, Freshbooks offers a 30-day free trial with no credit card required. Furthermore, all plans go with a 30-day money-back guarantee.

Features

Professional-looking invoices
FreshBooks has an invoice generator, making it super easy to create and configure invoices.

Expense tracking and categorization
Take a peek at how your business is spending your cash through its reliable expense tracker and categorize for easy tax filing.

Time tracking
Work more efficiently by tracking how much time you or your team spends on each project or client.

Accounting tools
Use a simplified double-entry accounting toolset to record finances with accuracy.

Collaboration and project management software
Easy accounting software that helps manage projects and promote collaboration.

App integrations
Integrate over 100 useful apps to organize and manage your business on a single platform.

Mobile accounting app
Free FreshBooks mobile app to stay in the now of your business anywhere you go.

Cloud, SaaS, desktop app, and mobile app
FreshBooks is available in multiple application channels via the web, desktop app, and mobile app.

Customer Support

Besides the comprehensive resource hub that tackles the most frequently asked questions, FreshBooks has rockstar worldwide support that anyone can reach out for guidance. Whether you’re a user in Ireland (1800 949 046), UK (0808 101 3408), France (33 801 84 00 99), or the US (1 866 303 6061), it has globally structured customer support dedicated to assisting users Monday through Friday 8 AM – 8 PM ET.

FreshBooks also offers email customer support, which you can contact through [email protected].

Strengths and Weaknesses | The Verdict

With FreshBooks, accountants and business owners get access to essential tools that make running a business a breeze. Its award-winning customer support ensures that one call is all it takes to receive help whatever issues you encounter. Also, its numerous app integrations guarantee that you don’t have to jump from one software to another to keep track of your business’s finances — tying everything in one place.

With its Lite plan, FreshBooks is among the best accounting software for a small business with no employees. Perhaps its disadvantage is the limited features. Although plans are reasonably priced, you need to pay more if you want any specialized features.

Buyer’s Guide | Tips on Selecting the Best Accounting Software for Small Business

A single Google search for the best cloud accounting software for small business from Google will give you innumerable options, but what should you choose? With every company saying theirs is the best, it’s difficult to pin down the best software that meets all your accounting needs. Here’s a quick buyer’s guide to help you what to consider when selecting the perfect accounting software for you.

Costs

First, you should consider how much you are willing to shell out for accounting software. Then, find the top 10 accounting software with plans that are within your budget range. Check thoroughly if any of these companies have the features that you need. If none, you may need to increase your budget to accommodate your needs. Don’t go for affordable software that lacks essential features.

Usability

Do you need web-based software that operates on a cloud or an app? If you’re on a hunt for the best accounting and payroll software for small business, you must consider its ease of use. While many busy business owners want to access their finances via a mobile app, some prefer the traditional way of the web. Also, you must not forget to opt for a product that enables shared accessibility features. If you want another person to access your records, make sure you get one with the appropriate number of allowed users.

Customer Support

The best self-employed accounting software has accessible and responsive support. Encountering problems with your software can be frustrating. But it’s even more frustrating if you can’t reach someone from the other line to straighten things out. That’s why you should choose a company that has responsive customer support. Ensure the company has other communication channels, so if you can’t reach its phone support, you can send questions through email or chat.

Features

The common misconception about products is that the more features, the better. But that’s not all true. When choosing accounting software, pick one with vital features, such as tax and accounting software features. The extra features are appealing, but if you don’t need them, leave them out. Some features have associated costs, so you’ll end up spending more on something you don’t need at the moment. Plus, unnecessary features may make your dashboard look unorganized. Only include features that serve your needs.

Best Accounting Software for Small Business | The Takeaway​

Money is the lifeline of every business, and if you don’t know where your finances go, prepare for a collapse. Here’s the thing — if you can’t translate your business into numbers, you can’t improve it. That’s why an accounting software where you can record your expenses, income, and literally every dollar that goes in and out is a must, independent of the business size.

You can even opt to use free open source business accounting software if you have no budget. It doesn’t matter if you get free or paid software. Using one doesn’t only give you readable data about your business health, but it also boosts productivity and collaboration. It also centralizes financial management.

Frequently Asked Questions | FAQ​

The easiest accounting software programs are FreshBooks, QuickBooks, and Wave. Accounting may seem an intimidating task. However, thanks to the unlimited resources on the internet, it’s now easier to learn. Also, accounting software developers today consider fundamental factors, such as ease of use and simplicity, when building software, so even people with non-finance degrees can learn to use the software in days.

The best accounting software is QuickBooks, Wave, BizSight 365, Xero, and FreshBooks. They’ve been developed, curated, and evaluated according to small businesses’ necessary features. Moreover, these solutions have flexible plans to accommodate every small businesses’ needs with room for more features. You can rely on these software programs to deliver the features that other solutions don’t have.

The best free small business accounting software is Wave. It’s packed with premier features, such as professional-looking invoice templates, reports, inventory, chart of accounts, and multi-currency to ensure users get the features they need, minus the cost. It even has a free downloadable mobile app for users who want to manage their business on the go.

Yes. QuickBooks is a product of years of development and refinement by Intuit. Although it also caters to medium-sized businesses, most of its functions target to help small business owners — either those who have just started or are already growing their business. It’s user-friendly, flexible, and meant to match the needs of a wide array of users. Not to mention QuickBooks is a household name and one of the best accounting software for small business you can find in the market today.