Small business accounting is time-consuming, tedious, and complicated.
If you’re a small business without a dedicated accounting person, some unlucky soul on your team is managing that (if not you) or you outsourcing it to an accountant.
If you’re a solo boss, then you have to find time to do that with the other million things you juggle.
Let’s be honest, you don’t really keep up with it like you should and it gets neglected. Then tax time rolls around and you hate yourself for not being on top of things.
Nothing can make accounting fun, but there are some apps that at least make it less painful.
Here are 5 small business accounting options that will make your life a whole lot easier so you can focus on your business.
If your business is young and you’re trying to bootstrap as much as you can, Wave is the solution for you.
Wave has all the features you would need, including syncing with your bank accounts and various reports. You can send invoices and let your customers pay online. It even has payroll built in.
It’s an incredible full-featured package with no limits, for absolutely free.
If you’re a freelancer or run a solo service-based business, Freshbooks is for you.
Invoicing is where Freshbooks really shines, and includes features like recurring invoices, automatically billing your clients, reusable line items. It also has project management and time-tracking rolled into it, along with basic accounting.
Freshbooks has tiered pricing, but you can get a 30-day free trial to test it out.
Less accounting is geared towards freelancers who, as you may have guessed by the name, want to do less accounting.
It prides itself on a simple interface with all the tools a freelancer needs – proposals, invoicing, expenses, and reporting. A unique feature of Less Accounting is its network of CPA’s, in which you pay an additional monthly fee to have one of them do all your book keeping for you.
Less Accounting doesn’t have a free trial, but it does have a 6–day money-back guarantee.
For small to mid-sized businesses, Xero is a joy to use.
It has all your basics covered – account reconciliation, reports, invoicing, and payroll. But it also has extra features that larger companies would need, including inventory management, expense claims, bill payment, purchase orders, asset management, and even multi-currency reporting for international businesses.
Xero has tiered pricing with a free 30-day trial.
If you have experience in the Quickbooks world or other traditional accounting software, then you’ll feel right at home with Quickbooks Online.
This service is a simplified version of Quickbooks’ other desktop programs. If you already have your data in another Quickbooks program, it’s easy to port it over to the online version. It includes most of the features the desktop version of Quickbooks would have, such as expenses, invoicing, and payroll, with the advantage of online access and a simplified interface.
Quickbooks Online has tiered pricing with a free 30-day free trial.
What I Use
When I first started my business, I used a really cool software called Outright that was perfect. But then they were sold to GoDaddy, a company I absolutely hate, so I needed to look for another solution.
I used Wave for several years and it was great, especially since I had a really small budget to spend, and would recommend it to any business starting out.
I tried out Xero and loved using it, but didn’t stick with it because I had no need for all the additional features they have, though I would recommend it for most small and mid-sized businesses.
I also tried out Quickbooks, but had trouble connecting to my bank account and they didn’t really have a solution for me. I was surprised, since I banked with Chase at the time, which is a pretty large bank. Their support told me it was an issue on their end, but didn’t know when it would be resolved. I actually liked their interface, so that was disappointing.
I landed on Freshbooks and loved it for the simplicity. They just revamped their entire backend, so it’s even more intuitive than before and has some great new features. I had a very specific need that Freshbooks met.
I have a few clients that pay me a set price monthly to maintain their websites. They really didn’t want to bother with getting a monthly invoice, and preferred to just setup their credit card and have it automatically charged.
Freshbooks gives me the ability to auto-charge a client’s credit card monthly without having to remember to send out separate invoices, something both I and my clients appreciate.
I haven’t personally tried out Less Accounting because they don’t have a free trial, and I don’t like being charged for something and then asking for a refund if it doesn’t work out. But it seems to be growing in popularity so I included it.
What Should You Use?
That really depends on you and your specific needs.
If your accounting software is working for you, keep it. Changing to a whole new platform is a lot of work and not worth it if the benefits are small.
But if your current accounting system is too tedious, archaic, or expensive, then it may help to give something else a shot. Depending on how much extra time you have, take one or more of these platforms on a 30-day free trial and see if it works for you.
Have one that you like, or one that isn’t mentioned? Share with us in the comments!
I’m a web designer, marketing consultant, and the creator of this site. You’ll find me reading in coffee shops or snowboarding down mountains.