Best Accounting Software for Small Business 2021 Comparison

Monday, November 8, 2021
Michael Scheiner
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Accounting may not be the world’s oldest profession, but it’s not that far behind. 

There are historical records of bookkeeping going back to ancient Mesopotamia. The Romans formalized some early accounting laws. The medieval Persians and Arabic nations refined the practice with more sophisticated math. The Chinese contributed with the advancement of paper and writing tools. But it was the first financial institutions of Renaissance Italy that truly solidified banking, bookkeeping and accounting as part of society’s most significant professions.

Today, the best business accounting software can rival any Venetian or Florentine bookkeeper. 

If you’re a small business owner, or even a freelancer or self-employed, chances are you’re not in a position to hire the services of a fancy accounting firm. But you still have bookkeeping that needs to get done. That’s why you need good accounting software for small businesses. 

Not only will great online bookkeeping tools help you manage your books, but most of the best accounting platforms have a range of useful financial tools. Aside from accounts payables and accounts receivables, liabilities and assets, you can take advantage of payroll tools, inventory tracking, tax calculators, multi-currency transactions, and even bank reconciliation features.

In this article, we’ll break down the various advantages of online bookkeeping software, and take a tour of the most common tools and features. Then, we’ll take a look at 15 of the best online accounting SaaS on the market today. We’ll compare their strong points, their best features, and costs.

 

 

Accounting software comparison chart (top 10 highest rated)

Product

Best for

Pricing starts at

Website

Intuit QuickBooks Online

Best business accounting software overall

$6.00 /month

Visit

Xero

Top business accounting software for freelancers

$5.50 /month

Visit

FreshBooks

Great online bookkeeping software

$4.50 /month

Visit

Zoho Books

Good simple accounting software

$9 /month

Visit

Sage

Top accounting software for small business

$3.00 /month

Visit

Wave

Best free financial software for small business

Check vendor

Visit

Kashoo

Great bookkeeping tool for non-accountants

$16.65 /month

Visit

ZipBooks

Great mobile business accounting app

$15 /month

Visit

Crunch

Good financial tool for small businesses

Check vendor

Visit

myBooks

Good online tax software for small business

Check vendor

Visit

 

 

What is accounting software & what does it do?

Accounting software is considered a part of larger enterprise resource planning (ERP) platforms. ERP includes everything from managing production to distribution to the financial side of running a business. 

These days, there are many great online accounting tools. You can get these at more affordable prices than full ERP plans. This is great for freelancers, solo entrepreneurs, startups and small businesses.

What is small business accounting software good for?

Accounting software is a must when it comes to managing a company’s books. It often uses AI and other automation to take over a lot of the tedious data entry and form filling, which accounting is known to have lots of. This can save a small business a lot of money instead of hiring CPAs and other professional bookkeepers.

Accounting software gives you an overview of your financial health. This includes your assets and liabilities, what’s owed to you and when, and what you owe. Accounting software facilitates accepting payments from credit cards, or systems like PayPal or Stripe. 

Monitoring inventory and automating reorders is another great advantage of business accounting software. It can also help plan budgets for project management. For this you also get time tracking to keep projects and payments on schedule.

When it comes to bank reconciliations, where your books must be aligned with the banks, accounting software can help resolve any issues quickly. There are many other tools that accounting software includes to help businesses calculate taxes and stay in compliance. 

The best accounting software will give you real-time reporting on your current, historical and forecasted cash flows. This is often done in a neat, visual dashboard which you can customize.

How to use accounting software

First, read this article and pick a vendor. Many have free trials if you do not want to commit right away. Once you’ve subscribed to a vendor, follow the guides to migrate your financial data into the platform.

You’ll need to make sure your contacts are properly categorized, and many of the best accounting tools help do this. Separate your customers from your suppliers so you know which direction the money flows. 

Next it’s a good idea to sync your bank account to your accounting software. This makes it easy to update in real-time your financial activity and to update that data in your books. It also helps with bank reconciliation.

You can often use templates to set up custom quotes and invoices. It’s best to figure out any repeat transactions and to automate them or turn on notifications. 

Using the platform’s API, you can integrate your accounting software with other SaaS. And finally, you’ll want to download the mobile version and learn how to use it on the go.

 

What are the different types of accounting software?

There are many different types of accounting software. Ther major functions are:

  • Double-entry bookkeeping

  • Quotes and Invoicing

  • Expenses and budgeting

  • Payment processing

  • Multi-currency accounting

  • Inventory management

  • Time tracking

  • Payroll services

  • Bank reconciliation

  • Sales tax calculation

  • Profitability forecasting

  • Financial reporting

 

What is the best accounting software? Here’s our top 15 list:

After scanning the reviews, playing with the free trials, and talking with loads of users, we’ve finally compiled the ultimate list of the best accounting software. This list of 15 will have something for everyone, from freelancers, to Amazon ecommerce sellers, to small businesses aiming to grow.

 

Intuit QuickBooks Online (Best business accounting software overall)

QuickBooks is one of the most well-known accounting solutions. It’s made by the US financial software company Intuit, which also makes TurboTax. Quickbooks came out in 1983 as one of Intuit’s flagship products. At one point Quickbooks had three-quarters of the market share in their industry. But the recent entry of new online accounting systems has beefed up competition.

Quickbooks has full solutions for everything from accounting to inventory management. You get tons of features to manage payments and payroll services. You can do job costing and time tracking. Manage bills, calculate sales tax and invoicing are a snap. For payables you can handle credit cards, eChecks, PayPal, mobile payments and point of sale. Quickbooks even has options that connect you with a live bookkeeper. 

There is QuickBooks Desktop and QuickBooks Online. For small business owners QuickBooks Online is the best online accounting software. Quickbooks Online has many pricing plans which can be as low as $6.00 per month. You’ll need the best plan for great business analytics and insights. There are no free trials, but there is a cheap plan for freelancers. Check the site for the most current prices. Quickbooks has desktop versions for Mac and Windows, as well as mobile apps for iOS and Android.

Intuit QuickBooks Online is best for:

  • Overall

  • Freelancers

  • Self-employed

  • SMBs

Quickbooks 

 

Xero (Top business accounting software for freelancers)

Xero is accounting and bookkeeping software that hails from down under. It’s been around since the mid 2000s. Today it also has offices in the UK and the US. As of 2019 the company was boasting over 2 million users. Xero is used in over 18 countries. This one is a tough contender for that best overall spot. 

Xero makes it easy to manage tracking and paying bills. You can handle claims and expenses and even do reimbursements. Speed up bank transactions by connecting Xero to your bank. This also includes bank reconciliation functionality. To do payments Xero works with Stripe and other payment processing tools. You also get multi-currency payment processing. Xero is a project tracking tool for accountants. You get quotes, invoices, sales tax, time tracking and profitability tracking. Xero lets you do employee payroll easily. More advanced tools let you create workflow automations for bookkeeping. Xero is one of the few platforms that lets your customer pay with PayPal.

Xero has a free trial on offer. There are 3 pricing plans. The cheapest is very affordable at $5.50 per month. But it only gets you limited invoices, quotes and bills. You can also get Gusto Payroll as a Xero add-on. There’s also Xero mobile accounting from the Apple store or the Google Play store. 

  

Xero is best for:

  • Freelancers

  • Startups

  • Small businesses

  • Medium businesses

Xero  

 

FreshBooks (Great online bookkeeping software)

FreshBooks is a solid and user-friendly invoicing and accounting software. Its functionality is geared for the small business owner. The company has been around since 2003 and launched the platform one year later. They’re headquartered in Toronto.

With FreshBooks you get all the basics for double-entry accounting like invoicing and billing. You can also do expense tracking, time tracking, budgeting and estimates. Accounting features include balance sheets, accounts receivable and payable, and general ledger tools. You could set up basic automations with FreshBooks for things like payment reminders to auto credit card charges. FreshBooks helps with project management too. It streamlines communication and task delegation. This platform has lots of customization options. For things like inventory tracking you’ll need an integration. But it’s got decent financial reporting functions. FreshBooks is popular with Amazon eCommerce sellers too.

FreshBooks is a cloud-accounting system. There are mobile apps for Android devices and iPhones. FreshBooks has 3 pricing plans beginning at $4.50 per month billed annually. You can get custom pricing if you have over 500 billable clients. There are free trials on all the plans. For more automations you’ll need a more premium package.

FreshBooks is best for:

  • Startups

  • eCommerce

  • SMBs

  • Amazon sellers

FreshBooks 

 

Zoho Books (Good simple accounting software)

Zoho is a major name in business software solution. Their many products include CRMs and customer support platforms. It’s a multi-billion dollar enterprise with over 6,000 employees worldwide. Zoho Books is their great accounting management software for businesses of any size.

You got payables. This covers purchase orders and expense receipts. There’s inventory tracking that can do reorders and replenishes. When it comes to receivables, Zoho Books has got you covered. Create custom invoices, send payment reminders and offer online payment options. You can connect your bank account. Workflow rules can automate some transactions. There are contact features which work like a light CRM. There’s time tracking and project management. Finally you can schedule regular customizable reports.

Zoho Books has a Windows desktop version from the Microsoft store. But it’s mostly an online tool. There are mobile apps for iPhone, Androids. The price range between the most and least affordable package is not too wide. It starts at $9 per month, and check the site for deals. There are also add-ons for extra users.

Zoho Books is best for:

  • Freelancers

  • Self-employed

  • Startups

Zoho Books   

 

Sage Accounting (Top accounting software for small business)

The Sage Group is a multinational business software company from the UK. After Oracle and SAP, Sage makes the next largest ERP solution. The company is part of the FTSE 100 index. Sage has many accounting software options for small businesses as well as large ones.

There’s everything starting from double-entry accounting. Set up invoices and keep track of when they get paid. You can accept payments with Stripe. Sage Accounting tracks your financial data. It uses this for forecasting future cash flows. You can connect this to your bank. This streamlines transactions. Real-time reporting covers profits and loss statements. It also gets you at-a-glance balance sheets. There’s inventory management. You can capture receipts or bills with mobile apps. It then scans and auto-fills the data entry in your files.

Sage Accounting has mobile versions for iOS and Android. There are only two pricing packages. They are $3.00 and $7.50 per month. The big difference is you get real-time reports and data AutoEntry with the pricier one. You can also try Sage Accounting for free.   

Sage Accounting is best for:

  • Small business

  • Accountants

  • Self-employed

  • ERP

Sage Accounting  

 

Wave (Best free financial software for small business)

Wave is a Canadian software company that got off the ground in 2009. It began offering free online accounting software. The platform grew to include many tools for double-entry bookkeeping as well as other financial services like payment processing.

The Wave platform today is broken down into five suites of financial tools. There is a basic accounting suite. It lets you manage all your expenses and track your income. You can create customizable invoices and monitor their payments. Wave lets you accept credit card payments as well as online bank transfers. It lets you do payroll and calculate taxes. You can also manage paying outside contractors. Finally, you can send and manage receipts. Overall, this is a solid platform for basic accounting needs, but not loaded up with too many advanced features. Wave can also provide expert accounting coaching by real advisors.

Wave has mobile apps which let you handle most features, like sending receipts. There are many Wave suites you can still use for free, including accounting, invoicing and receipt scanning. Premium prices for payment tools are pay-per-use. The payroll suite starts at $20 per month.

Wave is best for:

  • Free users

  • Freelancers

  • Self-employed

  • Startups

Wave

 

Kashoo (Great bookkeeping tool for non-accountants)

Kashoo comes out of Vancouver on Canada’s west coast. The founders of Kashoo had one goal in mind: to make accounting software for the layperson to use. This is not a platform for CPAs and pro bookkeepers. Kashoo also has a great resource center with blog posts about accounting basics.

Kashoo begins with a smart tool to streamline double-entry accounting. It analyzes and categorizes transactions. This keeps you above board with the IRS (in the USA) or CRA (in Canada). Kashoo gets you great expense tracking. The smart inbox sorts all expenses out. You can send invoices and get payments with Stripe or KashooPay. Analytics can make reports covering things like cash flow, accounts receivable, accounts payable, and general ledger stuff. Finally, Kashoo connects to over 5,000 banks or credit unions and syncs transactions in real-time.

Kashoo is a SaaS, which means you log on and use it from your web browser. There are Kashoo mobile apps too. Kashoo offers a 14-day free trial. You can create a free account for this. The full package costs $16.65 per month billed annually. That is good for unlimited users.

Kashoo is best for:

  • Freelancers

  • Startups

  • Small businesses

Kashoo   

 

ZipBooks (Great mobile business accounting app)

ZipBooks is a relatively new online bookkeeping platform. It was launched in 2017 out of Utah. It’s known to offer a great user experience. However, this is a basic platform with only core tools. It doesn’t have many more advanced features for accounting.

ZipBooks has 4 major categories of tools on offer. Accounting services keep track of all your transactions and balances. There is a tool for intelligent feedback. This offers AI advice on how to streamline your operations. For billing you can create branded invoices. ZipBooks also offers intelligent ‘invoice quality scoring.’ It helps you decide how to create and send invoices to maximize payments. You get tools to manage expenses, receipts and even 3rd party vendors you regularly deal with. Finally, ZipBooks has a range of business intelligence features.

ZipBooks has a mobile app which lets you do billing and other tasks. It runs on both iOS and Android. There is a free version of ZipBooks which gets you unlimited invoices, but only lets you connect one bank. Premium versions begin at $15 per month. For larger companies, you can request a quote.

ZipBooks is best for:

  • Self-employed

  • Startups

  • SMBs

  • Mobile apps

ZipBooks 

 

Crunch (Good financial tool for small businesses)

The name of this platform is quite apt. It brings to mind the number crunching that is the core of bookkeeping. Crunch is a UK-based company. It combines online accounting tools with expert accounting services.

Crunch offers an online platform for free accounting and bookkeeping. It is aimed at the self-employed and the really small business owner. You can use a mobile app to migrate your banking data to Crunch. It’s easy to make and send invoices from mobile too. There’s a Crunch Snap app to take photos of receipts. There are bank reconciliation tools and ones to help with taxes. You also get real-time overviews of cash flows, profits and back-taxes owed. With Crunch, you can request single sessions with an accounting professional. There’s also a trip tracker if you need to count mileage traveled for a job.

The free version of Crunch is pretty sweet for freelancers and the self-employed. The premium packages get you more advanced features like better support and annual accountancy health checks. Prices are listed in British Pounds.

Crunch is best for:

  • UK small businesses

  • Freelancers

  • Self-employed

  • Tax calculations

Crunch

 

myBooks (Good online tax software for small business)

myBooks is the free online accounting software from the Indian software company Zetran. Zetran also makes myPlan, which is financial planning software. It also makes myStaff, which is for HR purposes. myBooks is available in India, the USA, Canada and many more countries.

myBooks makes it quick and easy to connect your bank to the platform. You can import your transactions for more streamlined monitoring. Much of the platform centers around the myBooks accounting dashboard. Here you get real-time up to date data on your financial health. You can see cash flow, expenses, profits and loss projections too. There are tools to help with handling your taxes. Currency management is also available. You get good contact management which can work like a basic CRM. There are also templates which can be used to create custom invoices. 

myBooks has a free version. It is good for just 1 user and allows for up to 25 monthly transactions. For current prices, check with the vendor directly. There is also a myBooks free trial. 

myBooks is best for:

  • Tax calculation

  • Self-employed

  • Startups

  • Small business

myBooks 

 

Odoo Accounting 

Odoo is an open source suite of business SaaS. They have many tools belonging to the wider set of ERP platforms. These include sales, productivity and operations packages, the last including accounting. 

Odoo Accounting covers all the standard bookkeeping features. You can create invoices and track billings. There are also templates for recurring transactions. It lets you accept payments online from your customers. Managing your expenses and other bills is simple. Odoo syncs with your bank accounts. There are very clear reports and you can apply business intelligence analytics to the data. Odoo takes over data entry for many accounting paperwork. Finally, Odoo uses AI to help automate other redundant tasks.

Odoo Accounting is free if you don’t need more apps or more hosting. Otherwise it costs $24 per month. 

Odoo accounting is best for:

  • Small businesses 

  • Medium businesses

  • Startups

Odoo

  

FreeAgent

Right out of Scotland, FreeAgent is an open-source accounting solution for small business owners. Today it’s owned by the NatWest Group.

FreeAgent aims to be a right-out-of-the-box accounting tool. It can be used by business owners, accountants, or both together.  You got the set of estimates and invoices features. You can snap pics of bills and expenses. There’s an in-built stopwatch for time tracking. You can manage your accounting projects. Cash flow forecasts help with budgeting. It’s easy to connect your bank. You get a sales tax calculator and a multi-currency tool. Finally, FreeAgent has a great real-time dashboard to monitor your financial health. 

You can try out FreeAgent for 30 days for free. After that it’s one price fits all. It starts at $10 per month for the first 6 months. Then it’s $20 per month from thereon.

FreeAgent is best for:

  • SMBs

  • Sales tax

  • Multi-currency calculator

FreeAgent 

 

KashFlow

KashFlow was founded in 2005 in the UK. The founders wanted to specialize in small business accounting solutions after getting fed up with Microsoft Word and Excel. Aside from accounting they have many ERP tools as well as CRM.

KashFlow does a range of bookkeeping tools. They include purchasing and expense features. There are invoicing and payments. It lets you accept credit cards like Visa and Mastercard. Direct debit works too. There is also a range of payroll features. These are sold as a separate package. Certified accountants can also open special accounts with KashFlow. 

KashFlow has 3 plans. They are priced in Pounds. The most affordable plan is around $10 USD per month.  But for multi-currency transactions you’ll need one of the more premium packages.

KashFlow is best for:

  • Small businesses

  • Medium businesses

  • Accountants

KashFlow 

 

OneUp

Based out of San Francisco, OneUp boasts over 700,000 small businesses as users. The platform evolved out of myERP.com. It’s a major partner with Google Apps and Square.

OneUp accounting does automatic bookkeeping. Once you sync it up with your bank it takes over a lot of manual data entry. It also suggests entries for you. It learns from your entries and refines its process constantly. Easy reports show you profits and loss figures. You can create invoices directly from quotes. It can send you automatic notifications when invoices are due. OneUp makes suggestions which also keep you on top of inventory tracking. It helps with replenishing stock automatically. You can also set up one-touch reordering. 

There’s a 30-day free trial with OneUp. The many different pricing packages begin at $19 per month for one user. For unlimited users it can go up to at least $169 per month.

OneUp is best for:

  • Startups

  • SMBs

  • Accountants

  • Inventory tracking

OneUp  

 

Aqilla

Aqilla refers to its platform as a postmodern ERP solution. It aims to be a superior product to Xero, Sage and Quickbooks. This one's for small businesses who are aiming to scale up.

The full feature list here is impressive. Aqilla leverages AI in most of its features. You have a full range of tools for budgeting and expense management. You can do your timesheets and project costing too. Aqilla has more advanced financial ledger features. There’s also inventory control. This platform handles multi-company transactions in many currencies. Aqilla has a very powerful API to integrate this software with other business tools. Finally, you get detailed financial health analytics and great reporting tools.

Aqilla has a total of 6 different pricing tiers. There is no free version but the lightest one is very affordable. This plan only lets you create and approve expenses. Prices are listed in British Pounds. The core plan is about $17 USD but contact the vendor for actual prices.

Aqilla is best for:

  • Self-employed

  • SMBs

  • International companies

Aqilla 

 

Financial, tax and accounting software tools: our conclusion

So what’s the key takeaway after all of this? Well, the first lesson is clear: You don’t need to bow down to a professional but costly expert to manage your business’s finances. If this list of the best financial accounting tools has shown anything, it’s that you have got options (even free ones).

It may seem obvious now, but Intuit QuickBooks Online and Xero still take top positions. If you are still not sure about whipping out the old credit card, Wave and ZipBooks are great free accounting tools. Finally, if you are ready for a more robust financial accounting management system, look into the Sage family of products or Aqilla. These are still geared for the small business, but can help these businesses scale up and grow.

But really, all 15 accounting tools here have something great to offer. On top of that, new platforms are hitting the scene all the time. The question is not so much which accounting software you should use. It’s how you’ll take advantage of this streamlined efficiency once you’ve implemented such a platform. The benefits are numerous, almost too many to count!

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