Best Accounting Software 2021
When you start a small business, you may notice that money goes in and out of your bank account in a never-ending fashion: think about the money you receive from your customers and the money you pay your landlord, your vendors, your advertising agency, your staff — to name a few. To help you efficiently organize your finances and make sure the right numbers are reported, you need trustworthy accounting software.
The best accounting software is your digital best friend as it helps you sync your bank accounts and credit cards. Typically, this software can help you store receipts and other important documents, send invoices, record cash flow, track your transactions, and categorize them in order to put together financial statements for your company. With these financial statements, you can compare profit against loss, check bank and loan balances, and predict how much tax you may have to pay that year. Some software even let you speak with accountants or bookkeepers so you can check if you’re keeping your books right.
There’s an array of products out there, but we’re here to help you find the best business accounting software for you. For this review, we researched more than 15 accounting software and assessed each one based on four factors: ease of use, integration, scalability, and cost.
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Top 5 Rated Accounting Software
Best for small business owners
You know something is good when you keep seeing their name in your research. Such is the case with Intuit’s QuickBooks Online — an extremely popular accounting software for small businesses and among tax professionals.
QuickBooks is cloud-based, meaning both you and any accountants you hire can view the same numbers in real-time. You can use their browser version, or their intuitive mobile app that lets you take pictures of your receipts, track mileage, receive payments, and review reports on the go.
Although we mentioned that many tax professionals use QuickBooks, you certainly don’t need to be well-versed in accounting to use this software. You’ll find a library of online training resources and forums that can answer your questions. You can also integrate QuickBooks with third-party apps such as PayPal and Shopify. The best part? You can take advantage of their 30-day free trial before committing to a paid subscription plan.
- The cheapest plan comes at $25 per month.
Best for business owners with little accounting knowledge
Founded in Toronto in 2003, FreshBooks is a cloud-based accounting and invoice software that helps small business owners manage their money, especially when they’re on the go and only have access to their phones or tablets.
With FreshBooks, you can set up payment reminders, customize your invoices with due dates and discounts, calculate sales tax automatically, and track time with a handy Chrome browser extension.
FreshBooks is also great when it comes to integration capabilities: it communicates with your bank and keeps track of any bank deposits, recurring payments, and auto bills. Not only that, but it also integrates with tax apps and other products such as GSuite and Gusto.
And just like QuickBooks, there’s a 30-day free trial as well if you’d like to test the waters before committing.
- The cheapest plan comes at $6 per month.
Best for user interface
Founded in New Zealand in 2006, Xero is loved by over two million users for its clean interface and great integration capabilities.
Like the two products mentioned above, Xero is also cloud-based and offers a mobile app. The software allows you to easily pay bills, claim expenses, track your inventory, track time, send out invoices and quotes, store your documents, calculate sales tax on transactions, and run bank reconciliation.
Their dashboard makes great use of bar charts to present your real-time cash flow. To ensure your safety, Xero also has your information go through encryption and secure data centers.
Although Xero has great integrations with banks and third-party apps such as Stripe and GoCardless, it has limited reporting capabilities and charges fees for ACH payments. That said, Xero is perfect for self-employed professionals or small business owners looking for a simple-to-use and beautifully crafted software!
- The cheapest plan comes at $11 per month.
Sage Business Cloud Accounting
Best for small businesses wanting a personalized experience
Founded in 1981 in Newcastle, England, Sage Business Cloud Accounting has been around for decades, helping small businesses and non-accounting professionals take care of their finances. You can personalize your software by choosing your industry, company size, and needs. More than three million businesses around the world use Sage… that’s how you know they’re trusted!
The cloud-based software provides everything you need: you can manage cash flow, accept payments, send invoices, manage payroll, and control your inventory. Their software is available on all devices so you can view and share your financial details wherever you are.
Sage also integrates well with banks, AutoEntry, Zync, and various tax compliance tools. Got questions? Their customer support team is ready 24/7 to help.
- The cheapest plan comes at $10 per month.
Best for free software
If there is one thing that differentiates Wave from other software in this review, it’s that it’s available for free! Of course, this Toronto-based accounting software platform offers multiple tier plans, but their free plan fulfills most business needs such as tracking expenses, sending invoices, scanning receipts, and reporting finances. There is also a mobile app for quick access to your books.
There are also no limits on transactions or billing, and you can have an unlimited number of users on one account. When the year-end comes, your accountants can easily pull important tax and financial documents from Wave to help you prepare your business’ tax return.
Wave is perfect for freelancers or service-based small businesses that don’t have to manage inventory because it doesn’t have the tools to support inventory management. This software also cannot be integrated with many third-party apps.
That said, Wave is available free-of-charge so make the most of this software!
- The cheapest plan comes free of charge.
Our Rating Process
We scored these factors out of five points for our top five software to help you decide which one to go for. After all, it’s your money we’re talking about, so let’s be smart about which one you’ll be paying for.
Frequently Asked Questions
Many software we mentioned in this review have millions of customers worldwide. Though, Sage separates itself from the pack with 6.1 million customers. This is perhaps not surprising as it’s been around since 1981 and provides a solid range of accounting capabilities.
We’ve done quite a bit of research and can confidently say that QuickBooks appears as one of the most popular software for small businesses. The features they provide streamline the accounting process, thus letting business owners focus on growing their business instead. That said, QuickBooks’ services aren’t the cheapest, so be sure to do your own research and see what plans best suit your needs. You should only pay for what you need after all.
How much you should be paying for your accounting software depends heavily on your business size and needs. For example, Wave is available for free so it’s ideal for freelancers and smaller businesses. However, it doesn’t integrate with third-party apps nor support inventory management so if you do have an inventory to control, go for a paid subscription elsewhere. If you have thousands of employees around the world and have complex financial needs, the price of your software would also go up — very advanced tier plans can go up to $150 per month!
The ease of use of accounting software has a lot to do with user interface. Can you find what you need easily? Are dashboards and reports easily understandable? How many clicks does it take to reach your goal? Can you share your documents with your accountants in real-time? With all these factors in mind, we’d say that Xero is the easiest to use accounting software.